CIBC Capital Markets on Thursday maintained its outperformer rating on the shares of Superior Plus (SPB.TO) while raising its price target to C$9.50 from C$8.00 following the company's first-quarter results..
Superior's first-quarter results may mark an inflection point where the narrative changes back to a stronger growth outlook based on data center-related compressed natural gas demand, CIBC said.
Superior agreed to provide 135 megawatt of power generation for a hyperscale project, with an in-service date of mid-2027. The company expects to recognize $350 million from overall data-center business over 2.5 years from secured agreements, and is evaluating several other opportunities.
"Given the rapidly evolving data centre market and its need for high reliability, we expect more opportunities to emerge," CIBC said. "While we are not speculating as to the ultimate size of new opportunities, we are increasing our valuation multiple modestly to reflect renewed growth potential."
Price: $7.61, Change: $-0.18, Percent Change: -2.31%