Core Insights - South Bow Corporation (NYSE:SOBO) has received a cautious outlook from Wall Street following mixed results for fiscal Q3 2025, with analysts reiterating Sell ratings and adjusting price targets slightly upward [1][2]. Financial Performance - The company reported an EPS of $0.47, exceeding estimates by $0.08, but revenue fell 13.7% year-over-year to $461 million, missing estimates by $37 million [2]. - Average throughput on the Keystone Pipeline was approximately 584,000 barrels per day (bbl/d), while the U.S. Gulf Coast segment reported around 703,000 bbl/d [2]. Analyst Ratings and Valuation - Analyst Praneeth Satish from Wells Fargo maintained a Sell rating due to ongoing valuation concerns, noting that SOBO trades at an EV/EBITDA multiple of 10.2x compared to the sector median of 8.8x [3]. - The potential financial impacts from the MP 171 incident were also highlighted as a concern for the company's outlook [3]. Guidance and Operations - Management has kept its annual 2025 guidance largely unchanged, expecting Normalized EBITDA around $1.010 billion and a slight improvement in the effective tax rate from 23%-24% to 20%-21% [4]. - South Bow Corporation operates critical crude oil pipelines and facilities that connect Alberta's oil production to U.S. refining markets in the Midwest and Gulf Coast [4].
Wall Street Has a Cautious Outlook on South Bow Corporation (SOBO), Here’s Why