Pembina Pipeline (TSX:PPL) Stock Earnings: What to Watch on Thursday

Pembina (TSX:PPL)(NYSE:PBA) stock is set to deliver earnings next Thursday, so what should Motley Fool investors look forward to?

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Key points

  • Pembina Pipeline (TSX:PPL)(NYSE:PBA) stock continues to raise its guidance for the year on the back of strong earnings and future production.
  • Investors will have to watch whether future cash flow is enough to keep them, as it tries to bring several projects online.

Pipeline powerhouse Pembina Pipeline will report its third-quarter 2021 results next Thursday, Nov. 4. The earnings report by Pembina stock is slated to become available after the market closes. This will be followed by a conference call the next morning at 8 a.m. MT.

Earnings

Motley Fool investors will be watching Pembina stock to see if optimism continues for the company’s growth projects. During the last report, Pembina announced solid earnings. The termination of its agreement with Inter Pipeline added $350 million to its books. Further, its second-quarter adjusted EBITDA came in at $778 million.

Volumes continued to rise, and higher prices certainly helped boost income. As Motley Fool investors likely noticed, the price at the pump only continues to climb. This will be good news for Pembina stock, and others.

While the second quarter saw the announcement of three partnerships, along with the “vision” for its Alberta Carbon Grid, investors will want to know when they can see cash on hand.

Production

Several developments occurred during the last quarter that investors will want an update on. This includes the reactivation of its Phase IX pipeline, progression on its Phase VII Peace Pipeline Expansion and whether service in the first half of 2023 looks likely, and perhaps if the Phase VIII expansion will continue.

Now this is all good news for investors looking to see cash flow continue for the next few decades. But many Motley Fool investors are excited about Pembina stock thanks to its recent investment in clean energy. Its carbon-capture program will help create a new, clean-energy opportunity for cash flow based on existing pipelines. Its New Ventures group also seeks out new low-carbon opportunities. This also now includes a new wind power project.

Guidance

Last quarter, Pembina stock updated its 2021 adjusted EBITDA guidance, raising the lower end. It expected to reach between $3.3 and $3.4 billion for full-year 2021. So, it will be interesting to see if it’s still on target.

Analysts believe Pembina stock will see a few improvements. Earnings per share should increase 12% quarter over quarter to $0.64 from a huge loss the year before. Revenue should reach $1.78 billion — a 5% increase year over year. The company has been growing steadily and defying expectations, so it’s no wonder the company continues to reach 52-week highs.

The current target share price on the TSX today remains at $43.08. That would create a potential upside of about 4% as of writing. Plus, Motley Fool investors can pick up a substantial 6.02% dividend yield as of writing on the TSX today.

Earnings will be available Thursday, Nov. 4 after the market closes.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe owns shares of PEMBINA PIPELINE CORPORATION. The Motley Fool recommends PEMBINA PIPELINE CORPORATION.

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