(Adds analyst comment in paragraphs 11 and 12. Updates shares.)
Keyera (KEY.TO) was last seen down 2.5% after the company on Monday provided a business update and multi-year growth outlook after the company closed its $5.15-billion acquisition of Plains All-American Pipeline's (PAA) Canadian natural-gas liquids assets
Keyera expects fee-based adjusted EBITDA per share to increase by about 35% or an approximate 16% compound annual growth rate from 2025 to 2027.
The growth targets reflect the contributions from the Plains acquisition, realization of near-term synergies, 2026 fractionation capacity expansions, and continued filling of available capacity across the integrated system.
Keyera is also targeting a 7% to 8% fee-based adjusted EBITDA per share CAGR from 2027 to 2029, supported by continued filling of available capacity, completion of major growth projects and further optimization of the combined platform.
The outlook is supported by strong basin fundamentals, with oil, natural gas and NGL production across the Western Canadian Sedimentary Basin expected to continue growing as export-market access expands and global demand for Canadian energy products increases.
Keyera has realized its initial $100 million annual run-rate near-term synergy target, with about $90 million in corporate cost savings already captured since the Plains transaction was announced in June 2025.
As a result, Keyera now expects total near-term annual run-rate synergies to range from $120 million to $140 million, expected to be realized within the first 12 months after deal closing.
With the addition of Plains Marketing business, Keyera's platform now includes frac-spread exposure, which represents another important source of liquids supply for the company's integrated system.
Keyera expects its Marketing's realized margin to be between $360 to $390 million in 2026.
Taking into account the partial-year contribution of Plains assets, 2026 growth capital spending is expected at $550 million to $625 million and maintenance capital at $240 million to $260 million.
National Bank Financial reiterated its sector-perform rating on Keyera shares and its $56.00 price target following the update.
"Based on the upsized synergy expectations combined with incorporating the recently announced ACE Rail Terminal investment, we expect a bump to our valuation. Meanwhile, we view the company's pro forma 7-8% fee-based adj. EBITDA per share CAGR for 2027-2029 as providing further support for the stock," analyst Patrick Kenny wrote.
Keyera shares were last seen down $1.47 to $57.54 on the Toronto Stock Exchange.
Price: $57.76, Change: $-0.71, Percent Change: -1.21%