Scotia update Outperform $25Event Element (EFN) announced an increase to its Q4/15 guidance. Implications Following a broad based market sell-off, risk aversion, and erosion of investor confidence, Element's stock has come under pressure and the increased guidance is likely to serve as a much needed catalyst. Q4/15 EPS guidance increased to $0.35, above our estimate and consensus of $0.32. The company is now guiding for fourth quarter originations of $2.6B, well ahead of our expectations at $1.7B. Management noted that all four verticals experienced volumes. We think an unexpected boost across the core fleet business would be particularly well received by investors. Management highlighted its oil and gas industry exposure is limited to 8% of earnings assets, with approximately 75% of these credits being investment grade. Management noted that credit performance remains solid with average arrears at just 16 bp across all of its portfolios. With more than 70% of its earning assets denominated in US$, EFN noted that it has the benefit of an exchange rate that will contribute favourably to its earnings targets for 2016, likely suggesting an upward bias to the current $1.61 target. Recommendation Maintain $25.00 target and Sector Outperform rating. Following recent weakness the stock now trades at just 8.2x 2016E EPS, and 1.1x book, likely providing investors with an attractive entry point.