Canada's AltaGas beats Q3 EPS estimates, maintains FY outlook

Overview

• Canada energy infrastructure firm's Q3 normalized EPS beat analyst expectations

• Q3 normalized EBITDA rose 45% yr/yr, driven by higher global LPG exports

• Company expects full-year results near high end of guidance range

Outlook

• AltaGas expects 2026 normalized EBITDA at C$2.0 bln–C$2.1 bln, near high end of guidance

• Company maintains 2026 normalized EPS guidance of C$2.35–C$2.60

• AltaGas sees REEF Phase I commercial operations starting in Q1 2027

Result Drivers

• GLOBAL LPG EXPORTS - Record LPG exports to Asia and higher export volumes drove Midstream segment growth

• PIPESTONE II CONTRIBUTION - Addition of Pipestone II and increased utilization at Townsend boosted gathering and processing volumes

• UTILITIES COST PRESSURE - Utilities segment EBITDA declined due to higher operating and administrative costs, partially offset by modernization investments

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 8 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the natural gas utilities peer group is "buy"

• Wall Street's median 12-month price target for AltaGas Ltd. is C$60.00, about 6.7% above its October 28 closing price of C$56.21

• The stock recently traded at 21 times the next 12-month earnings vs. a P/E of 20 three months ago

Reuters Recommended Reads

• Oct 28 - Japan's Kyushu Electric Power to buy 12 LNG cargoes a year from Canadian expansion project

• Oct 28 - Canadian oil firm Whitecap Resources' Q3 revenue rises on strong production, higher prices

• Oct 28 - Norway's Equinor Q3 adjusted operating income nearly doubles on higher output, gas prices

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)