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Keyera Corp. (TSE:KEY)
:KEY
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Keyera Corp.
(TSX:KEY)
Rating:81Outperform
Price Target:
C$47.00
â–²(11.88%Upside)
Positive Factors
Execution Success
Continued successful execution of known opportunities should benefit the share price and valuation.
Financial Stability
The company's debt to EBITDA ratio is below the target range, which is a strong indicator of financial stability.
Future Growth
Keyera's dedicated team is actively evaluating inorganic opportunities, which could lead to future growth.
Growth Potential
Keyera Corp's new growth remains robust across its entire integrated value chain from gas processing debottlenecks, frac expansions, and NGL extensions.
Negative Factors
Market Guidance
The market was disappointed with the 2025 Marketing guidance falling short of consensus, leading to underperformance of shares compared to the S&P/TSX Pipelines Index.
Market Performance
The market was disappointed with 2025 Marketing guidance falling short and underwhelming results.
Keyera Corp. (KEY) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$9.62B
Dividend Yield4.95%
Average Volume (3M)998.67K
Price to Earnings (P/E)17.6
Beta (1Y)0.65
Revenue Growth8.00%
EPS Growth52.89%
CountryCA
Employees1,005
SectorEnergy
Sector Strength54
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.57
Shares Outstanding229,153,370
10 Day Avg. Volume1,443,860
30 Day Avg. Volume998,671
Financial Highlights & Ratios
PEG Ratio29.32
Price to Book (P/B)2.32
Price to Sales (P/S)0.00
P/FCF Ratio222.74
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$46.56Price Target Upside10.83% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Keyera Corp. Business Overview & Revenue Model
Company DescriptionKeyera Corp. engages in the energy infrastructure business in Canada. The company operates through Gathering and Processing, Liquids Infrastructure, and Marketing segments. The Gathering and Processing segment owns and operates raw gas gathering pipelines and processing plants, which collect and process raw natural gas, remove waste products, and separate the economic components primarily natural gas liquids; and provides condensate handling services. This segment has approximately 4,400 kilometers of gathering pipelines; and holds interests in 12 active gas plants in Alberta. The Liquids Infrastructure segment provides gathering, processing, fractionation, storage, transportation, liquids blending, and terminalling services for natural gas liquids (NGLs) and crude oil through a network of facilities that include underground NGL storage caverns, above ground storage tanks, NGL fractionation and de-ethanization facilities, pipelines, rail and truck terminals, NGL blending facilities, and the Alberta EnviroFuels facility. This segment also produces iso-octane. The Marketing segment engages in the marketing of propane, butane, condensate, and iso-octane, as well as liquids blending activities. The company was formerly known as Keyera Facilities Income Fund and changed its name to Keyera Corp. in January 2011. Keyera Corp. was founded in 2003 and is headquartered in Calgary, Canada.
How the Company Makes MoneyKeyera Corp. generates revenue through a diversified portfolio of energy services. The Gathering and Processing segment involves the collection and processing of raw natural gas, which is then sold or transported to other facilities. The Liquids Infrastructure segment focuses on the transportation, storage, and handling of natural gas liquids, which are used in various industries, including petrochemical and energy sectors. Additionally, the Marketing segment deals with the distribution and sale of natural gas liquids and iso-octane to domestic and international markets. Keyera's revenue is bolstered by long-term contracts and strategic partnerships with major energy producers, providing a stable and recurring income stream. The company also benefits from its extensive infrastructure network, which enables it to efficiently manage and transport energy products across North America.
Keyera Corp. Earnings Call Summary
Earnings Call Date:May 15, 2025
(Q1-2025)
| % Change Since: -5.15%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Positive
The earnings call reflected a generally positive outlook with strong financial results and strategic growth initiatives like the sanctioning of KFS Frac 3. However, challenges like the extended maintenance outage at the AEF facility and commodity market volatility were acknowledged. The company's strong balance sheet and proactive measures provide a solid foundation for future growth.Q1-2025 Updates
Positive Updates
Sanctioning of KFS Frac 3
Keyera announced the sanctioning of KFS Frac 3, a major expansion that will increase total frac capacity by about 60%, backed by long-term customer commitments with high take-or-pay provisions.
Strong Financial Results
Net earnings rose to $130 million, up from $71 million in the same period last year, with continued strong margin contributions from the fee-for-service segment, which were up 9% year-over-year.
Wapiti Gas Plant Ahead of Schedule
The Wapiti gas plant is now expected to reach effective capacity in 2026, a year earlier than anticipated, with several optimization projects supporting further growth.
Solid Balance Sheet
Keyera ended the quarter with a strong balance sheet, reducing net debt by over $500 million over the last 2 years, with a net debt to EBITDA ratio of 2 times, below the targeted range.
Negative Updates
Extended Maintenance Outage at AEF Facility
The AEF facility's maintenance outage extended to 7 weeks instead of the anticipated 6, impacting the Marketing segment's realized margin by approximately $50 million.
Commodity Market Volatility Impact
Despite risk management strategies, recent volatility in commodity markets has affected projections, with the Marketing segment guidance lowered to account for the outage impact.
Company Guidance
During Keyera's 2025 First Quarter Conference Call, the company provided guidance on several key metrics. They reaffirmed their goal to grow fee-based adjusted EBITDA by 7% to 8% annually from 2024 to 2027. The sanctioning of KFS frac 3 will expand frac capacity by about 60%, with both frac projects expected to deliver returns within a 10% to 15% range. The company's adjusted EBITDA for the first quarter was $298 million, while distributable cash flow was $190 million, or $0.83 per share. The marketing segment realized margin is projected to be between $310 million and $350 million for 2025, accounting for an estimated $50 million impact from an AEF outage. Growth capital expenditures are expected to range from $300 million to $330 million, and maintenance capital expenditures are anticipated to be between $70 million and $90 million. The company also expects cash taxes to be between $100 million and $110 million. Overall, Keyera continues to focus on disciplined capital allocation and remains optimistic about long-term growth in the Western Canadian Sedimentary Basin.Keyera Corp. Financial Statement Overview
Summary
Keyera Corp. is in a strong financial position with solid revenue growth, improved profitability, and robust cash flows. While leverage is within a manageable range, liquidity should be monitored closely.Income Statement
Keyera Corp. demonstrates a strong performance with consistent revenue growth, shown by a 1.95% increase in total revenue from 2023 to 2024. The gross profit margin decreased slightly, but net income grew by 14.75%, indicating improved profitability. The EBITDA margin remains healthy, reflecting efficient operational management.85
Very Positive
Balance Sheet
The balance sheet shows a stable financial position with a debt-to-equity ratio of 1.38, indicating manageable leverage. The equity ratio is 32.35%, suggesting a solid equity base. However, the decrease in cash and cash equivalents warrants attention for liquidity management.78
Positive
Cash Flow
Keyera Corp. exhibits robust cash flows with a significant increase in free cash flow by 271.59% from 2023 to 2024. The operating cash flow to net income ratio is strong, highlighting efficient cash generation from operations. However, the negative financing cash flow reflects ongoing debt repayments.82
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 7.14B | 7.00B | 7.06B | 4.98B | 3.01B | Gross Profit |
| 1.03B | 1.06B | 917.52M | 787.66M | 650.12M | EBIT |
| 853.62M | 901.84M | 801.91M | 693.46M | 588.81M | EBITDA |
| 1.21B | 1.07B | 858.12M | 853.21M | 495.18M | Net Income Common Stockholders |
| 486.63M | 424.03M | 328.29M | 324.21M | 62.03M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 118.44M | 20.09M | -209.40M | 15.94M | 2.90M | Total Assets |
| 8.76B | 8.78B | 8.57B | 8.13B | 7.56B | Total Debt |
| 3.90B | 4.29B | 3.90B | 3.70B | 3.43B | Net Debt |
| 3.78B | 4.27B | 4.11B | 3.68B | 3.43B | Total Liabilities |
| 5.92B | 6.00B | 5.75B | 5.47B | 4.80B | Stockholders Equity |
| 2.83B | 2.78B | 2.82B | 2.66B | 2.76B |
| Cash Flow | Free Cash Flow | |||
| 1.01B | 272.80M | 29.40M | 67.21M | 27.84M | Operating Cash Flow |
| 1.27B | 975.49M | 925.33M | 583.84M | 688.17M | Investing Cash Flow |
| -235.31M | -819.71M | -843.92M | -397.12M | -748.31M | Financing Cash Flow |
| -935.65M | -134.26M | -100.65M | -173.85M | 53.80M |
Keyera Corp. Technical Analysis
Positive
42.01
Price Trends
42.33
Positive
42.19
Positive
42.29
Positive
Market Momentum
-0.16
Negative
52.61
Neutral
58.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:KEY, the sentiment is Positive. The current price of 42.01 is below the 20-day moving average (MA) of 42.25, below the 50-day MA of 42.33, and below the 200-day MA of 42.29, indicating a bullish trend. The MACD of -0.16 indicates Negative momentum. The RSI at 52.61 is Neutral, neither overbought nor oversold. The STOCH value of 58.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:KEY.
Keyera Corp. Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | C$9.62B | 17.63 | 19.55% | 4.95% | 8.00% | 52.89% | |
58 Neutral | $7.43B | 3.43 | -4.49% | 10.08% | 0.81% | -49.42% | |
| $21.74B | 16.99 | 11.55% | 5.11% | ― | ― | ||
| $51.56B | 16.36 | 15.89% | 4.77% | ― | ― | ||
| $2.83B | 23.96 | 17.23% | 4.99% | ― | ― | ||
| $8.39B | 21.24 | 6.56% | 3.12% | ― | ― | ||
42 Neutral | C$79.77M | ― | -16.97% | ― | -25.69% | 87.47% |
* Energy Sector Average
Performance Comparison
TSE:KEY
Keyera Corp.
42.59
7.32
20.75%
PBA
Pembina Pipeline
38.06
2.86
8.12%
TRP
TC Energy
50.04
16.74
50.27%
GBNXF
Gibson Energy
18.02
2.38
15.22%
ATGFF
AltaGas
28.52
6.98
32.40%
TSE:TWM
Tidewater Midstream and Infrastructure
0.20
-0.39
-66.10%
Keyera Corp. Corporate Events
Product-Related AnnouncementsBusiness Operations and Strategy
Keyera Corp. Sanctions KAPS Zone 4 Expansion to Strengthen Market Position
Positive
Jun 9, 2025
Keyera Corp. has announced the sanctioning of KAPS Zone 4, an 85-kilometre pipeline extension, enhancing connectivity to the Montney regions in British Columbia and Alberta. This strategic expansion, backed by long-term agreements with Montney producers, is expected to boost Keyera’s competitive position and support sustainable dividend growth through increased contracted volumes and diversified market access.
The most recent analyst rating on (TSE:KEY) stock is a Hold with a C$40.00 price target. To see the full list of analyst forecasts on Keyera Corp. stock, see the TSE:KEY Stock Forecast page.
Executive/Board ChangesShareholder Meetings
Keyera Corp. Announces Board Changes and Strong Shareholder Support
Positive
May 16, 2025
Keyera Corp. announced the retirement of directors Michael Norris and Douglas Haughey, marking a significant transition in its board leadership. The company also revealed the election of new directors, T. Tim Kitchen and Bob Pritchard, who bring substantial experience in the energy and investment banking sectors. The voting results from the Annual and Special Meeting of Shareholders showed strong support for all nominees and resolutions, including executive compensation and auditor appointments, indicating shareholder confidence in Keyera’s strategic direction.
The most recent analyst rating on (TSE:KEY) stock is a Hold with a C$40.00 price target. To see the full list of analyst forecasts on Keyera Corp. stock, see the TSE:KEY Stock Forecast page.
Business Operations and StrategyFinancial Disclosures
Keyera Corp. Reports Q1 2025 Results and Approves KFS Frac III Expansion
Positive
May 15, 2025
Keyera Corp. announced its first quarter 2025 financial results, highlighting a net earnings increase to $130 million and a fee-for-service realized margin growth of 9% compared to the previous year. The company sanctioned the KFS Frac III expansion, aiming to enhance its infrastructure and support long-term shareholder value. Despite a maintenance outage impacting the Marketing segment’s margin, Keyera maintains a strong financial position with a net debt to adjusted EBITDA ratio of 2.0 times, below its target range. The company continues to pursue organic growth opportunities and has secured additional long-term contracts, aligning with its strategic growth objectives.
The most recent analyst rating on (TSE:KEY) stock is a Hold with a C$38.00 price target. To see the full list of analyst forecasts on Keyera Corp. stock, see the TSE:KEY Stock Forecast page.
Dividends
Keyera Corp. Declares Second Quarter 2025 Dividend
Positive
May 14, 2025
Keyera Corp. announced a quarterly cash dividend of $0.52 per common share for the second quarter of 2025, payable on June 30, 2025. This decision reflects the company’s ongoing commitment to delivering shareholder value and maintaining a stable financial outlook, reinforcing its position in the energy infrastructure sector.
The most recent analyst rating on (TSE:KEY) stock is a Hold with a C$38.00 price target. To see the full list of analyst forecasts on Keyera Corp. stock, see the TSE:KEY Stock Forecast page.
Shareholder MeetingsFinancial Disclosures
Keyera Corp. Announces Q1 2025 Results and Annual Meeting Plans
Positive
May 1, 2025
Keyera Corp. announced the release of its first quarter 2025 results and the scheduling of its Annual and Special Meeting of Shareholders, both set for May 15, 2025. The results will be discussed in a conference call and webcast, while the Annual Meeting will be held both in-person and virtually, with shareholders encouraged to participate and vote. This announcement underscores Keyera’s commitment to transparency and stakeholder engagement, potentially impacting its market positioning by reinforcing investor confidence.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.