logo
  Join        Login             Stock Quote

Parkland Fuel Downgraded By CIBC To 'Sector Performer' On Valuation

 June 07, 2012 03:17 PM


(By Balaseshan) CIBC World Markets Inc. analyst Kevin Chiang downgraded his rating on shares of Parkland Fuel Corp. (TSE:PKI) to "Sector Performer" from "Sector Outperformer" due to valuation.

The brokerage maintained its $15.00 price target, which reflects a total return of 13% (including its $1.02 annual dividend), and is in-line with its "Sector Performer" rating.

While PKI has improved its transparency, Chiang suspects the Suncor contract and the limited details around its cost-savings initiatives will act as headwinds. He believes until there is greater clarity around these items, they will act as a cap on PKI's valuation.

That said, overall the analyst continues to have a favorable outlook for PKI as it moves forward with its plan to double its EBITDA within five years through a combination of cost cutting (targeting 5% reduction in operating costs), organic growth, and acquisition opportunities.

[Related -Glu Mobile Inc. (GLUU) Q2 Earnings Preview: Going For Three Consecutive 10%+ EPS Pops]

In addition, Chiang views PKI's dividend as safe and he is forecasting a payout ratio of about 60% in 2012/2013, with the company targeting a payout ratio of 50% over the next 4-5 years. PKI has intimated as well that it may look to raise its dividend.

Parkland Fuel is a marketer and distributor of petroleum products, managing a nationwide network of sales channels for retail, commercial, wholesale and home heating fuel customers. It operates in two segments: commercial segment and fuel marketing.

PKI is trading down 1.97% at $13.94 on Thursday.

iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageIntegrated Device Technology Inc. (IDTI) Q1 Earnings Preview: Another Beat and Pop?

Integrated Device Technology Inc. (NASDAQ:IDTI) will issue first quarter 2015 financial results on July 28, read on...

article imageHerbalife Ltd. (NYSE:HLF) Q2 Earnings Preview: The Potential To Shock?

Herbalife Ltd. (NYSE:HLF) will release its second quarter 2014 financial results after the close of trading read on...

article imageHealth Net, Inc. (HNT): Potential to Be Huge Winners Says Bank of America

As of this keystroke, Health Net, Inc. (NYSE: HNT) shares are up around 4% on the day. The managed health read on...

article imageHomeAway, Inc. (AWAY) Q2 Earnings Preview: Top and Bottom Line Bullish Surprise?

HomeAway, Inc. (NASDAQ:AWAY) will report its financial results for the second quarter ended June 30, 2014 read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.