TSX:EMA - Post Discussion
Post by
TimeBuilder on Sep 30, 2022 2:49pm
FYI= USD comments
9/29/2022 (MT News12:20 PM EDT, 09/2wires) -- BMO Capital Markets on Monday said Canada's energy infrastructure companies are poised to benefit from the rise in the value of the US dollar.
"The U.S. dollar's strength has turned into an earnings and FCF/sh tailwind for the Cdn. Energy Infrastructure sector," analyst Ben Pham noted. "Over the last few years, it has more or less been a translation headwind partially offsetting energy infrastructure expansion growth. The U.S. dollar has benefited from its safe haven status and the Fed's aggressive tightening cycle, pushing the USD/CAD to 1.37 (~8% YTD) with expectations towards 1.40 in the near-term. EMA, ALA, ENB, TRP, and FTS are the most sensitive to upward estimate revisions (range of +4-12%) given their high proportion of earnings generated in the US (we are currently modelling 1.25 USD/CAD). This should partially offset the negative valuation impact from rising interest rates that we flagged last week in our 2024 roll-forward report."
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