Veresen Inc. T.VSN.DB.B

TD on VSN

[Beckysboss]

Veresen Inc.
(VSN-T) C$8.86

Q1 Slightly Ahead of Expect
Awaiting FERC Decision

Veresen  (VSN)  reported  Q1/16  AFFO/share  (f.d.)  of  $0.27,  above  our 
$0.26 estimate but slightly below Q1/15 AFFO/share (f.d.) of $0.28.
 
Management reiterated its guidance for 2016 distributable cash per share
(basic) of $0.94–$1.08 (unchanged from prior).

Impact: NEUTRAL
 
Q1  Results  Slightly  Ahead  of  Expectations:
  The  results  beat  our  expectations  largely  from  higher than  forecasted  contribution  from Alliance, Aux Sable and Power, and was partially offset by lower VSN Midstream contribution. 
 
Updating  Forecasts;  Maintaining  Target: 
We  have  tweaked  our  financial  forecasts  to  reflect  the  quarter's  results  along  with  revised financing,  tax  and  F/X  assumptions.  We  are  maintaining  our  $11.00  target.

TD Investment Conclusion

Our BUY rating is based on our view that: 1) the Alliance Pipeline is well-

positioned to service the Montney, Duvernay, and Bakken and 2) asset

diversification strengthens support for the dividend.