Q: Hi 5i,
Any idea what's going on with Keyera? Right now, it's defying gravity and I don't think there's a single analyst out there who has called that, and although I own it and I like it, to me the underlying numbers don't justify the heady heights it's reaching. Any thoughts?
Thankyou,
Peter
Any idea what's going on with Keyera? Right now, it's defying gravity and I don't think there's a single analyst out there who has called that, and although I own it and I like it, to me the underlying numbers don't justify the heady heights it's reaching. Any thoughts?
Thankyou,
Peter
5i Research Answer:
At 20X earnings, it's on the higher end of its historical valuation, though it has been as high as 41X (2014) and as low as 9X (2020). The 4.48% dividend looks good vs GICs, and the dividend was raised in August. It is not expected to show much EPS growth, though, in the next two years. While we would consider it decent enough, certainly for income, we agree we cannot see a lot of concrete reasons (other than lower rates) for its 44% gain this year. We would be comfortable holding it but would not add. Analysts' average target is $44.85, below the current price.