Q: My broker lists 14 analysts following SOBO. Why is it that all five analysts who recommend SELLING this stock are based in USA. None of the Canadian analysts recommend selling this stock.
I will also appreciate your insight for SOBO. Sell,hold or buy. I am a conservative dividend investor.
Thank you
I will also appreciate your insight for SOBO. Sell,hold or buy. I am a conservative dividend investor.
Thank you
5i Research Answer:
We can't say exactly, but if we look at Goldman's recent sell rating, the analyst notes limited capacity for growth and a high valuation. High debt is also a likely factor. SOBO trades at 19x earnings, which is much higher than many energy producers, but also a bit lower than many infrastructure companies. But if we look at midstream US peers it is not really an outlier in terms of valuation. Consensus does call for lower earnings per share in 2026 ($2.07 to $1.74) and that is likely the main reason here for muted analysts' endorsement. Note we show 19 analysts: 4 BUY, 10 HOLD, 5 SELL. We also note some US analysts, such as JP Morgan, have NEVER been positive on the stock. Yet, SOBO is up 44% in the past year.