TC Energy: Analyst Day Drills Down on Capital Spending and Highlights Commitment to Leverage Goals

TC Energy’s Analyst Day largely reaffirmed our near-term forecasts. Therefore, our fair value estimates of CAD 63 and USD 46 per share and narrow moat rating remain unchanged. The firm reaffirmed EBITDA growth of 7% annually and dividend growth at a midpoint of 4% annually between 2023-26. The dividend will also remain unchanged after the spinoff on a consolidated basis. We're not surprised given its highly secure revenue stream and utility-like profile, with 97% of the business take-or-pay or rate regulated. These key factors primarily support our narrow moat rating. Key growth drivers remain U.S. and Canadian LNG exports, Mexican gas exports, and Bruce Power (nuclear, hydro).