South Bow initiated with a Hold at Jefferies

Jefferies initiated coverage of South Bow (SOBO) with a Hold rating and C$32 price target following the spin-out of TC Energy’s (TRP) Liquids Pipelines assets, including the Keystone pipeline. The firm likes South Bow for its stability, with 88% of EBITDA underpinned by long-term contracts, and yield proposition, but views these attributes as offset by a higher leverage profile and lower EBITDA/dividend growth compared to peers