Chemtrade Logistics Income Fund (CHE-UN.TO) was downgraded to Market Perform from Strong Buy at Raymond James, Tuesday.
Analyst Steve Hansen lowered his price target on shares of the Canadian industrial chemicals and services company to $15 from $21.
"Last night we attended a District of North Vancouver (DNV) council meeting where we expected to observe the second and third readings of Rezoning Bylaw 8778, key steps toward advancing the rezoning and lease extension (to Dec-31-44) of Chemtrade's Electrochem (EC) facility," Hansen said in a note to clients.
"...Advancing this bylaw has long been viewed as the critical gating item to securing a long-term lease and mitigating operational constraints beginning Jun-30-30 that would otherwise force the plant shutdown," the analyst said.
"Instead, we observed a council that ignored the risk assessments solicited, dismissed senior government support (Federal/Provincial), sided with NIMBYISM, and ultimately suspended further readings of the bylaw (vote: 4-3) - thus squashing any near-term visibility on an extension," Hansen said.
"While an alternative path may still emerge, including higher-level government involvement/pressure, we struggle to assign a timeline/probability to such an outcome."
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