May 17, 2019 / 4:18 PM / a year ago

BUZZ-RBC sees near-term cash crunch at Just Energy, cuts PT

** RBC cuts PT on Canadian natural gas utility Just Energy Group Inc to C$5 from C$5.50, shares down 1.3% to C$4.29

** Brokerage cites near-term uncertainty related to cash crunch

** JE management’s F2020 FCF guidance has raised concerns about co’s payout ratio and balance sheet - RBC

** RBC says fiscal Q1 generates the lowest seasonal cash flows, so there could be some near-term constraints on liquidity

** Potential M&A could put a floor value on the shares - RBC

** Brokerage modestly increases F2020 ACFFO/share estimate to C$0.76 from C$0.74 to reflect lower maintenance capex

** Separately, CIBC cuts target price to C$4.50 from C$5

** Average rating by just 6 analyst covering the stock is “hold”, median PT is C$5

** Stock down 5.3% YTD (Reporting By Arundhati Sarkar in Bengaluru)

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