Jul. 4 at 1:59 PM
$PPL.TSX
$PBA Two deals aggregated to one model. Used Trans Mountain expansionary pipeline running from Edmonton to Burnaby for comps toll fee per barrel. The pipeline expansion likely a political move to mitigate exposure to US dollar priced crude and seen as direct hedging play for any US-Iran related volatility. More uncertainty in Hormuz? Accelerated build out for the new pipeline.
Optionality of increased ownership stake from 10% to 15% with a probability of 20% is also included in base case.
Per the other deal,
Greenlight datacenter is valued using NPV for 310 million steady state annual EBITDA with 85% cashflow yield to shareholders net of equity cost for initial project cost.
Overall, a hedge play against middle east oil related conflict with exposure to AI datacenter build with 20% upside.
Target Price: CAD $ 77.50
