Veresen Inc. T.VSN.DB.B

CIBC

[retiredcf]

 

Veresen Inc.

Q1/14 After The Call: Strong Quarter, Thesis Firmly Intact

 We maintain our SO rating and $18.50 PT. We expect the de-risking of Veresen's $8B Jordan Cove (JC) project to result in material share price appreciation. We estimate JC is worth $4.50/sh risked, and calculate an incremental $2.50/sh from de-risking the project through to FID in 2015.

 Veresen expects the FERC to release the draft Environmental Impact Statement (EIS) in Q2/14. With the release of the draft EIS, the FERC will also provide a target date for issuing the final EIS. The FERC notice to proceed (a major project milestone) typically follows the final EIS.

 Veresen is analyzing what is the optimal ownership in the Jordan Cove project. Beyond de-risking the JC project, the most significant driver of value for Veresen is its ultimate retained interest in the project. Our valuation reflects an ownership interest between 30% and 50%.

 Veresen maintained its $1.09 2014 mid-point distributable cash flow per share (DCPS) guidance with a more narrow range of $0.97-$1.20 from $0.93-$1.25 despite issuing $285MM of equity in Q2/14. We estimate 2014 DCPS of $1.10.

[danilopowellya]

This post has been removed in accordance with Community Policy

[haywoodjablomie]

 Seemed like a great quarter and the outlook is positive as well . The effect on the share price : 0 !!    I guess all this great news was already baked into the price when we took off from $11 something .