South Bow Corporation Common Shares (SOBO)

FairStock Score: 63/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for durable toll-road assets, and South Bow's Keystone pipeline system is exactly that kind of infrastructure: crude oil must move, and the route from Hardisty to major U.S. hubs is not easy to replicate. In its fiscal Q2 2026 filing, revenue was $546.0M and net income was $134.0M, a 24.54% net margin. Trailing free cash flow is $682.0M, which is a 10.3% FCF yield against the $6.6B market cap at the 2026-10-13 close, and the 5.57% dividend yield is attractive. A Piotroski F-Score of 8/9 suggests accounting momentum. But Graham would focus on the balance sheet. Debt-to-equity is 2.16, and the Altman Z-Score of 0.66 flags distress risk. ROE is 17.35%, but ROCE is only 4.10%, which suggests the equity return may be leverage-assisted rather than driven by high returns on capital. At $33.93, FairStock calculations show a P/E of 15.42, P/B of 2.65, EV/EBITDA of 10.43 and PEG of 0.39. The Graham Number is $25.15, so the price sits -34.91% above that conservative value marker. FairStock Score is 63/100, and because there are only 0 years of filed results, no Lynch category can be assigned. I see a cash-generative pipeline business with a good dividend, but leverage and low ROCE make the current price look fair-to-full rather than a clear bargain.

In plain English: South Bow runs crude oil pipelines and related marketing, moving oil from Alberta to U.S. markets. It makes solid profits and cash, but it carries a lot of debt and its share price is above a conservative estimate of what the numbers support. The stock looks fair to somewhat expensive, with a high dividend but real financial risk.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer