TC Energy Sets 2026 EBITDA and Capex Guidance, Reinforces Growth Trajectory

What happened

TC Energy announced Q4 2025 earnings and revenues that surpassed estimates, along with a dividend increase, signaling operational strength. The company provided 2026 guidance, projecting comparable EBITDA between C$11.6 billion and C$11.8 billion and net capex of C$5.5 billion to C$6 billion, indicating planned growth investments. This aligns with the DeepValue report's view of TRP's post-2024 simplification into a gas-centric midstream utility, with Coastal GasLink in service since November 2024. The guidance reflects confidence in LNG Canada's ramp-up from June 2025, which should drive contract-backed volumes and cash flow visibility as highlighted in the report. However, investors must critically evaluate whether this optimistic outlook fully accounts for persistent risks like regulatory hurdles, project execution delays, and LNG demand volatility.

Implication

The increased dividend and EBITDA range suggest management's belief in stable cash flows, enhancing the utility-like appeal for income-focused investors. With LNG Canada's expansion, Coastal GasLink volumes are poised to boost EBITDA, consistent with the master report's emphasis on contract-driven growth. However, the capex budget of C$5.5-6B requires scrutiny for potential overruns or delays, given TRP's history of project challenges and integrity issues. Regulatory decisions on NGTL/Mainline rates remain a critical watch, as adverse rulings could undermine the projected EBITDA and weaken the investment case. Overall, while this news bolsters the BUY thesis, it does not mitigate the need for vigilant oversight of execution risks and external headwinds.

Thesis delta

The 2026 guidance affirms the DeepValue report's BUY stance by validating EBITDA growth and capex plans post-simplification, reinforcing the gas-centric strategy. No material shift is indicated, as key risks—LNG utilization, regulatory outcomes, and project execution—remain unchanged and critical to monitor. The dividend increase adds to income attractiveness but does not alter the core investment thesis based on contract-backed cash flows and LNG tailwinds.