CALGARY, Alberta - Pembina Pipeline Corporation (TSX: PPL (NYSE:PPL); NYSE: PBA), a leading provider of transportation and midstream services for the energy industry, has projected its adjusted EBITDA for 2025 to range between $4.2 billion and $4.5 billion. The company, which currently offers an attractive 5% dividend yield and has maintained dividend payments for 20 consecutive years according to InvestingPro, continues to demonstrate strong financial planning. This forecast reflects the anticipated positive impacts from continued volume growth across the Western Canadian Sedimentary Basin, new assets, and the full-year effect of the Alliance and Aux Sable asset consolidation. These gains are expected to be partially offset by the recontracting of the Cochin Pipeline and moderating commodity margins in the marketing business.
The company's capital investment program for 2025 is set at $1.1 billion, which is allocated to ongoing construction of previously sanctioned projects, development spending on potential future projects in response to growing volumes across the Canadian energy industry, and sustaining capital. This investment comes as Pembina has demonstrated strong growth, with revenue increasing by 37% in the last twelve months. InvestingPro analysis suggests the stock is currently trading at a P/E ratio of 16.75x, with additional insights available in the comprehensive Pro Research Report. Pembina expects to generate positive free cash flow within the provided EBITDA guidance range, fully funded by cash flow from operating activities after dividends. The forecast also anticipates a year-end proportionately consolidated debt-to-adjusted EBITDA ratio between 3.4 and 3.7 times.
On December 3, 2024, Mr. Alister Cowan was appointed to Pembina's board of directors. With over two decades of experience in the energy sector, Mr. Cowan brings a wealth of expertise to the company, particularly in financial executive roles at public companies.
Pembina anticipates a record-setting financial year in 2024 due to recent acquisitions, increased volumes in the WCSB, and a strong contribution from the marketing business. The company's strategy advancements in 2024 include the full consolidation of Alliance Pipeline and Aux Sable, and a positive final investment decision on the Cedar LNG Project. These moves are in line with Pembina's focus on strengthening its franchise and accessing global market pricing for Canadian energy products.
Looking ahead to 2025, Pembina's priorities include maintaining safe, reliable, and cost-effective operations, stewardship of ongoing construction projects, and progressing the Cedar LNG Project. The company will also continue to develop expansions to support growing demand for services on its conventional pipelines and fully contract remaining capacity on the Nipisi Pipeline. While the stock has shown strong momentum with a 17.77% year-to-date return, InvestingPro data indicates that five analysts have recently revised their earnings expectations downward for the upcoming period.
Pembina's 2025 guidance assumes the existing toll for Alliance Pipeline remains in effect for the full year, despite the Canadian Energy (OTC:CESDF) Regulator's review of the pipeline's tolls. Approximately 60 percent of the adjusted EBITDA contribution from Alliance Pipeline comes from the Canadian portion.
This article is based on a press release statement from Pembina Pipeline Corporation.
In other recent news, RBC Capital Markets highlighted PG&E Corp. and Williams Companies (NYSE:WMB), Inc in its top sector picks, with respective price targets of $24 and $62, both maintaining an "Outperform" rating. Meanwhile, JPMorgan (NYSE:JPM) adjusted the price target for Pembina Pipeline Corp (NYSE:PBA). from Cdn$62.00 to Cdn$63.00, following the company's third-quarter adjusted EBITDA report. The company reported an adjusted EBITDA of Cdn$1,019 million for the third quarter of 2024, slightly below the median estimate of Cdn$1,057 million, but revised its EBITDA forecast for 2024 to a range of Cdn$4.225 billion to Cdn$4.325 billion.
RBC Capital and Citi have also upgraded their price targets for Energy Transfer (NYSE:ET), citing increased estimates and potential for long-term growth. RBC Capital now forecasts Energy Transfer's Adjusted EBITDA to reach $15.560 billion in 2024, $16.320 billion in 2025, and $17.023 billion in 2026.
Sunoco LP, a significant entity in energy infrastructure and fuel distribution, recently unveiled its financial and operational projections for the year 2025. The company reported an impressive $83.7 billion in revenue over the past year.
These are among the recent developments for PG&E Corp., Williams Companies, Inc., Pembina Pipeline Corp., Energy Transfer, and Sunoco LP.
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