TSX:CHE.DB.E - Post by User
Comment by
bodiggityon Jun 07, 2019 4:44pm
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Post# 29807484
RE:RE:RE:RE:CEO's Comments
RE:RE:RE:RE:CEO's CommentsI am a new shareholder here and I see tremendous value especially at this level. Well worth the risk especially given the nice distribuition. Should be back in the teens verys soon.
Scotia Banks take:
OUR TAKE: Positive. We hosted institutional meetings in Toronto on May 13 with CEO Mark Davis and CFO Rohit Bhardwaj. The three recurring topics discussed in meetings and luncheon were (1) an update on the litigation reserves, (2) the assumptions supporting the newly-introduced guidance, and (3) the sustainability of distributions. As discussed below in more details, we believe that the distribution is sustainable. We believe that as it gets reflected in the company's unit price, dividend sustainability risk should significantly decline. We believe the company should be able to deliver 2019 results within its guidance range, with further upside potential in 2020 as (1) SPPC's right-sizing is felt, (2) WSSC enjoys further margin expansion, and (3) caustic soda prices increase from what we believe is a trough this quarter. We believe deleveraging could be accelerated through an extended caustic soda cycle and potential asset sales. We reiterate our Sector Outperform rating and $12.00 target on Chemtrade units.