National Bank of Canada analyst report todayPreliminary results look to be ahead of expectations. NFI has pushed back the release of its Q2 results, initially scheduled for August 2nd, to August 16th but preliminary results look to be ahead of ours and the consensus forecasts. The company is expecting Q2 revenues of $640-$660 million (NBF previously at $536 million and consensus at $609 million) and adjusted EBITDA of $10-$12 million (NBF previously at a loss of $5 million and consensus at breakeven) driven by higher deliveries and aftermarket volumes. We are encouraged by the solid revenue as this implies that the supply chain was stable enough to ramp up bus deliveries in the quarter. NFI’s backlog also remains strong at over 9,800 EUs worth more than $6.6 billion (versus 10,071 EUs worth $6.7 billion at the end of Q1). The company is maintaining its full-year 2023 guidance for revenues of $2.5-$2.8 billion and adjusted EBITDA of $30-$60 million as it prepares to meaningfully ramp up production in the second half of the year. In addition, NFI expects significant cash inflows in Q3 after delivery delays in Q2 (notably on some electric buses) kept working capital balances higher. Target trimmed to C$15.00 from C$16.00 We value the stock by applying a 6.0x EV/EBITDA multiple to our 2025 forecast. We have made several adjustments to our model (notably higher assumed interest expense) and as a result, our target goes to C$15.00 from C$16.00 previously (noting that our 2025 EBITDA forecast of $367 million is below management’s targeted $400 million). NFI’s pre-pandemic historical valuation average was 8.0-9.0x forward EV/EBITDA.