Q: Hi 5i Team,
Recent energy and infrastructure M&A (e.g., Parkland-Sunoco, MEG-Strathcona, Enbridge-Brookfield) signals consolidation, driven by Carney’s "pro-energy" and P3 policies amid U.S. tariff pressures. What’s your view on this trend? Can you suggest 3–5 small- to mid-cap Canadian companies (excluding megacaps like Suncor, Brookfield) poised for growth or acquisition in these sectors? Please highlight key risks. Thanks!
Derek
Recent energy and infrastructure M&A (e.g., Parkland-Sunoco, MEG-Strathcona, Enbridge-Brookfield) signals consolidation, driven by Carney’s "pro-energy" and P3 policies amid U.S. tariff pressures. What’s your view on this trend? Can you suggest 3–5 small- to mid-cap Canadian companies (excluding megacaps like Suncor, Brookfield) poised for growth or acquisition in these sectors? Please highlight key risks. Thanks!
Derek
5i Research Answer:
The typical risks for smaller companies exist, of course, but the industry is also highly cyclical as usual, adding more volatility. 'Most' companies are in good financial shape and that is less of a concern than in other cycles (on average). Most stocks are priced for recession and lower prices already. We would consider these smaller companies: TVE, ATH, BTE (as a target), KEL, CJ (as a target), VET, SGY