BMO Analyst Reveals Top Energy Infrastructure Stock Picks

Daily roundup of research and analysis from The Globe and Mail’s market strategist Scott Barlow Infrastructure picks BMO Capital Markets analyst Ben Pham highlights his preferred stocks in the energy infrastructure sector, “Sector performance. 1) Utilities. During Q4/25, the S&P/TSX Utilities Index delivered return of 1.9 per cent, supported by stronger-than-expected Q3/25 results, positive extensions to five-year capex programs, consistent dividend growth, and positive funds flow. This pushed total 2025 return to 19.3 per cent, well above typical 10 per cent but short of S&P/TSX Composite Index (up 6.2 per cent for Q/31.2 per cent for year). AQN was the top power and utility performer during Q4, and NPI was the laggard (38-per-cent variance); 2) Pipelines. During Q4/25, Cdn. pipes delivered negative 3.4 per cent, underperforming S&P/TSX Composite up 6.2 per cent driven by lower commodity prices coupled with underwhelming Q3/25 results/guidance updates. Similar to the utilities, the pipelines produced decent 13.5-per-cent returns for 2025, falling short of the Cdn broader market’s very strong 31.2 per cent. RGSI (up 11 per cent) was top performer Q4, and PPL the worst (down 5.7 per cent). Where are we notably above consensus? 1) H. Our new higher Q4/25 EPS of $0.38 is 19 per cent above consensus of $0.32 reflecting continued higher Ontario peak power demand, propping up 2025E EPS growth to 15 per cent, well above 6-8-per-cent CAGR [compound annual growth rate] guidance. 2) RGSI. Our higher Q4/25 adj. EBITDA (consolidated) of US$97-million sits 5 per cent above consensus on expected strong natural gas storage spreads, especially in Alberta. 3) BEP. While we are close to FFO/sh consensus of US$0.51 for Q4/25, there could be slight upside bias on gains on asset sales, a 5-per-cent distribution increase, and robust initiation of 2026 guidance (expect FFO/sh of 10 per cent plus).” Nat gas bull market delayed Scotiabank analyst Cameron Bean argued that the natural gas bull trade has merely been deferred, “In early December 2025, the NYMEX bull market appeared well on its way; however concerns over high U.S. natural gas production levels, warmer-than-expected late December and early January temperatures, volatile global natural gas prices, and sluggish power generation demand have driven the 2026 NYMEX strip down by nearly US$1/mmBtu [metric million British thermal units] over the last six weeks. While we see risks from each of these factors, our updated forecasts continue to show supply deficits in both the U.S. and Western Canada. Based on this, we believe the sell-off is overdone and expect both natural gas commodity and equity prices to increase over the next 12 months. If our base case supply and demand forecasts prevail, we expect NYMEX prices to exceed US$5/mmBtu by 2H/25 and believe the AECO differential will tighten below US$1.25/mmBtu at the same time. Our best ideas in the space balance our bullish views on the commodity with downside protection (because we can certainly be wrong about the commodity). Our top picks are TPZ, SDE, PEY, and EXE, with BIR and AR as our favorite options for natural gas torque” Ontario, B.C. housing markets soft National Bank economist Daren King summarized the results of the Teranet-National Bank housing price index, “Home transactions totaled 470.3K in 2025, a 1.9-per-cent decline compared to 2024 but a stronger year than 2023. On a monthly basis, transactions were down 2.7 per cent from November to December, a third decline in four months that is difficult to explain given recent interest rate cuts and improvements in the labour market. New listings declined by 2.0 per cent from November to December, a fourth consecutive decline. Active listings edged down 0.5 per cent from November to December, the fifth decline in six months. Market conditions loosened slightly during the month but continued to indicate a balanced market compared to the historical average. Still, the balanced market conditions at the national level largely reflect soft conditions in Ontario and B.C., while markets in all other provinces continue to favour sellers. Housing starts ended 2025 on a strong note, rising for the second consecutive month to reach 282.4K, their highest level in five months and well above consensus expectations. In 2025, there was a total of 259.0K housing starts nationwide, an increase of 5.6 per cent compared to 2024. This makes it the third-strongest year on record for the new construction market after 2021 and 2022. The Teranet–National Bank Composite National House Price Index remained stable from November to December after seasonal adjustment. Six of the eleven CMAs included in the index recorded increases: Ottawa-Gatineau (up 2.9 per cent), Edmonton (up 1.2 per cent), Winnipeg (up 1.1 per cent), Calgary (up 0.7%), Vancouver (up 0.2 per cent) and Quebec City (up 0.1 per cent). Conversely, prices declined in Hamilton (down 1.8 per cent), Halifax (down 1.0 per cent), Victoria (down 0.8 per cent), Toronto (down 0.5 per cent) and Montreal (down 0.2 per cent). From December 2024 to December 2025, the composite index declined by 3.5 per cent” Bluesky post of the day https://bsky.app/profile/jturek18.bsky.social/post/3mcwg5kpyut2j Diversion