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Tc Energy Corporation (TRP)
:TRP
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Positive Factors
Project Expansion
TRP announced a $0.9B USD data center project & signaled there's more to come, leading to an increase in capex estimates.
Risk Mitigation
The Southeast Gateway project is ready for service with CFE having agreed to the contracted rate, mitigating a major risk.
Negative Factors
Earnings Forecast
TRP expects EPS to be lower than 2024 due to various financial impacts such as increased depreciation rates and higher effective tax rates.
Earnings Performance
EPS was slightly below consensus, indicating some challenges in meeting earnings expectations.
TC Energy (TRP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$52.73B
Dividend Yield5.1%
Average Volume (3M)1.67M
Price to Earnings (P/E)16.7
Beta (1Y)0.38
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees6,668
SectorEnergy
Sector Strength46
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.69
Shares Outstanding1,039,287,700
10 Day Avg. Volume1,680,958
30 Day Avg. Volume1,670,503
Financial Highlights & Ratios
PEG Ratio-3.22
Price to Book (P/B)2.58
Price to Sales (P/S)0.00
P/FCF Ratio103.69
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$56.31Price Target Upside10.98% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
TC Energy Business Overview & Revenue Model
Company DescriptionTC Energy Corporation operates as an energy infrastructure company in North America. It operates through five segments: Canadian Natural Gas Pipelines; U.S. Natural Gas Pipelines; Mexico Natural Gas Pipelines; Liquids Pipelines; and Power and Storage. The company builds and operates 93,300 km network of natural gas pipelines, which transports natural gas from supply basins to local distribution companies, power generation plants, industrial facilities, interconnecting pipelines, LNG export terminals, and other businesses. It also has regulated natural gas storage facilities with a total working gas capacity of 535 billion cubic feet. In addition, it has approximately 4,900 km liquids pipeline system that connects Alberta crude oil supplies to refining markets in Illinois, Oklahoma, Texas, and the U.S. Gulf Coast. Further, the company owns or has interests in seven power generation facilities with a combined capacity of approximately 4,300 megawatts that are powered by natural gas and nuclear fuel sources located in Alberta, Ontario, Québec, and New Brunswick; and owns and operates approximately 118 billion cubic feet of non-regulated natural gas storage capacity in Alberta. The company was formerly known as TransCanada Corporation and changed its name to TC Energy Corporation in May 2019. TC Energy Corporation was incorporated in 1951 and is headquartered in Calgary, Canada.
How the Company Makes Money
TC Energy Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q1-2025)
| % Change Since: 0.65%|
Next Earnings Date:Jul 24, 2025
Earnings Call Sentiment Positive
The earnings call reflects a strong operational and financial performance with significant project completions and a solid financial outlook. However, regulatory delays and some operational challenges in specific segments present lowlights. The overall sentiment is positive, driven by notable achievements and strategic growth initiatives.Q1-2025 Updates
Positive Updates
Strong Start to Fiscal Year 2025
Safety incident rates are trending at five-year lows, and the business model continues to deliver strong results despite market volatility. Multiple drivers for future growth have been identified.
Southeast Gateway Project Completion
The Southeast Gateway project is complete and ready for service, finished 13% below the original budget. It is contracted until 2055, representing a significant inflection point in long-term cash flow.
Record Operational Performance
TC Energy set 13 all-time delivery records since early 2024. Throughput increased by 6% in the quarter, highlighting strong demand and operational efficiency.
Northwoods Project Announcement
The US $900 million Northwoods project has been approved, expanding the ANR pipeline system. It is expected to enter service in 2029, backed by a 20-year take-or-pay contract.
Bruce Power Major Component Replacement Program
Unit 5 MCR has been sanctioned, a $1.1 billion investment in emission-less nuclear energy, extending the life of Unit 5 by over 35 years.
Financial Outlook Reaffirmed
The 2025-2027 EBITDA outlook is reaffirmed, showing resilience against market volatility. The 2025 comparable EBITDA outlook remains $10.7 billion to $10.9 billion, a 7% to 9% increase over 2024.
Negative Updates
Regulatory Approval Pending for Southeast Gateway
The project is awaiting final regulatory approval from the National Energy Commission (CNE) to commence service, which is expected by the end of May.
Bruce Power Availability
Bruce Power achieved 87% availability, which was in line with the plan but lower due to the planned outage on Unit 5.
Lower Contributions from Power and Energy Solutions
Decreased contributions from Bruce Power given units 3 and 4 undergoing MCR and the planned outage on unit 5, partially offset by a higher average realized price.
Company Guidance
During TC Energy's First Quarter 2025 Results Conference Call, the company provided several key financial and operational metrics. They reported that their net capital expenditures for 2025 are expected to be between $5.5 billion and $6 billion, and they are on track to place $8.5 billion of assets into service this year, with these projects currently tracking approximately 15% below budget. The company reaffirmed its 2025 EBITDA outlook, projecting between $10.7 billion and $10.9 billion, a 7% to 9% increase over 2024 results. For 2027, TC Energy targets EBITDA of $11.7 billion to $11.9 billion, indicating a 5% to 7% three-year growth rate. The Southeast Gateway project, a major endeavor contracted until 2055, was completed 13% below budget and is anticipated to significantly enhance the company's long-term cash flow profile. Additionally, the approved $0.9 billion Northwoods project will expand the ANR system, backed by a 20-year take-or-pay contract, and is expected to enter service in 2029. Overall, TC Energy emphasized its strong start to the year, resilient business model, and multiple growth drivers amidst market volatility.TC Energy Financial Statement Overview
Summary
TC Energy demonstrates strong profitability but faces challenges with revenue growth and high leverage. The company maintains robust operating margins and satisfactory return on equity. Cash flow management shows potential weaknesses with declining free cash flow. The financial stability is influenced by high debt levels, posing potential risks if revenue contraction persists.Income Statement
TC Energy shows solid profitability with a TTM gross profit margin of 48.32% and a net profit margin of 34.04%, indicating efficient cost management and strong bottom-line performance. However, the company has faced revenue contraction over the past year, with a decline of 4.50% from 2024 to 2025. The TTM EBIT margin remains robust at 42.11% while the EBITDA margin is at 84.00%, showcasing strong operating efficiency.72
Positive
Balance Sheet
The debt-to-equity ratio is high at 2.24, reflecting significant leverage, which poses potential financial risk. Return on equity stands strong at 16.16%, demonstrating effective equity utilization to generate profits. The equity ratio is 22.97%, indicating a moderate level of equity funding relative to total assets.65
Positive
Cash Flow
The free cash flow growth rate is negative, showing a substantial decline from previous periods. The operating cash flow to net income ratio is 1.57, indicating that operating cash flows are well-aligned with net income. However, the free cash flow to net income ratio is lower at 0.15, suggesting limited free cash flow generation relative to net income.58
Neutral
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 13.15B | 13.77B | 15.93B | 14.98B | 13.39B | 13.00B | Gross Profit |
| 6.36B | 6.61B | 7.75B | 6.93B | 6.68B | 6.53B | EBIT |
| 5.54B | 5.79B | 6.86B | 7.28B | 7.25B | 7.00B | EBITDA |
| 11.05B | 11.45B | 8.66B | 5.48B | 6.39B | 8.87B | Net Income Common Stockholders |
| 4.48B | 4.70B | 2.92B | 748.00M | 1.96B | 4.62B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.96B | 801.00M | 3.68B | 620.00M | 673.00M | 1.53B | Total Assets |
| 120.55B | 118.24B | 125.03B | 114.35B | 104.22B | 100.30B | Total Debt |
| 61.99B | 59.88B | 63.66B | 58.30B | 52.77B | 49.56B | Net Debt |
| 60.03B | 59.08B | 59.98B | 57.68B | 52.09B | 48.03B | Total Liabilities |
| 82.11B | 79.88B | 86.03B | 80.23B | 70.82B | 66.83B | Stockholders Equity |
| 27.69B | 27.59B | 29.55B | 33.99B | 33.27B | 31.40B |
| Cash Flow | Free Cash Flow | ||||
| 690.00M | 1.34B | -881.00M | -352.00M | 966.00M | -1.08B | Operating Cash Flow |
| 7.01B | 7.70B | 7.27B | 6.38B | 6.89B | 7.06B | Investing Cash Flow |
| -6.79B | -6.91B | -12.29B | -7.01B | -7.71B | -6.05B | Financing Cash Flow |
| -1.65B | -3.87B | 8.09B | 487.00M | -88.00M | -800.00M |
TC Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| $52.73B | 16.73 | 15.89% | 5.10% | ― | ― | ||
57 Neutral | $7.22B | 3.16 | -4.49% | 5.63% | 0.82% | -49.15% | |
| $101.91B | 24.10 | 9.51% | 5.70% | ― | ― | ||
| $21.82B | 17.06 | 11.55% | 5.28% | ― | ― | ||
| $2.80B | 23.88 | 17.23% | 6.98% | ― | ― | ||
| $8.33B | 21.06 | 6.56% | 3.12% | ― | ― | ||
77 Outperform | C$9.58B | 17.55 | 19.55% | 4.92% | 8.00% | 52.89% |
* Energy Sector Average
Performance Comparison
TRP
TC Energy
50.74
17.18
51.19%
ENB
Enbridge
46.52
13.00
38.78%
PBA
Pembina Pipeline
37.56
2.14
6.04%
GBNXF
Gibson Energy
17.10
1.41
8.99%
ATGFF
AltaGas
27.84
6.32
29.37%
TSE:KEY
Keyera Corp.
41.82
6.84
19.55%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.