Analyst Note| Stephen Ellis |
Keyera reported robust first-quarter earnings as stronger marketing margins and a more optimistic macro outlook drove results and prompted management to up marketing guidance for the full year. Driven by strong upstream activity around Keyera’s gas plants, gathering and processing volumes continued to operate at high capacity. The firm reported adjusted EBITDA of CAD 257 million in the first quarter of 2022, 14% higher year over year. After accounting for a more optimistic outlook on near-term volume growth and commodity pricing-driven margins, but accounting for increased capital spending perpetuated by raw material inflation and labor/supply chain issues, we’ve adjusted our fair value estimate to CAD 30 from CAD 28.