Pembina Pipeline Corp. (PPL.TO) - July 7, 2025
In today’s edition of the Daily Stock Report, we offer an examination of Pembina Pipeline Corp (PPL.TO). PPL.TO entered the Red Unfavored Zone in the S&P/TSX Composite Index Report on May 12, 2025. The shares have faced significant underperformance, with a -0.52% decline over the past month, -2.74% in the quarter, and –1.96% year-to-date. This may not seem substantial; however, by contrast, the TSX Composite Index benchmark (TSX.I) has posted positive returns of +2.69% for the month, +16.57% for the quarter, and +9.33% year-to-date. This represents an underperformance of over 11% since the beginning of the year and 3.21% in the last month alone.
One of the most powerful aspects of SIA’s relative strength analysis is its ability to highlight not only which investments are outperforming, but also which ones are underperforming; allowing investors to avoid weaker names and focus on stronger opportunities. Even if you had invested in the TSX Composite Benchmark, you would have benefited from identifying when the name entered the unfavored zone, helping you manage downside risk more effectively.
In looking at the attached candlestick chart, the shares formed a double top formation in November and March of this past year at the $57.50 area. The shares have drifted since then and are currently at an important support level of $50.00, which mirrors where the shares were in February, between the two tops. It will be interesting to see if the shares can maintain this critical price point. Pembina has also seen its relative strength deteriorate, moving into the unfavored position to #178 in the SIA relative strength matrix of the SIA S&P/TSX Composite Index and slowly drifting lower, reflecting a weak trend within the broader market. The stock's beta of 0.77 indicates it may be less volatile than the overall market, but the current technical setup, along with its underperformance, could signal more challenges ahead.
Delving into the Point and Figure chart to help identify key support and resistance levels, we observe a strong uptrend beginning in 2020, followed by a consolidation phase from 2022 to 2023. A renewed uptrend emerged in 2024 but has shown signs of losing momentum since December of last year. What is most interesting is the formation of a column of O’s in April, which was one box lower than the column of O’s in February, a formation which indicates a deteriorating technical trend. Currently the shares are trying to reassert themselves upwards; noted within the current column of X’s.
The key support level to watch will be the $48.36 to $49.33 price point. If the shares cannot hold support there, the downtrend may intensify with potential next support below that near $43.80. To the upside, resistance is at $57.80 to $58.95 range – its most recent high. With an SMAX of 5 out of 10, there isn’t much short-term strength against the asset classes and PPL.TO currently has a bearish Double Bottom Pattern.
Pembina Pipeline is midstream company serving the Canadian and North American (primarily Bakken) markets with an integrated product portfolio. The firms' assets include pipelines and gas gathering, as well as assets across fractionation, storage, and propane exports.
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