Action Note

Equity Research April 12, 2022

Paper & Forest Products

West Fraser Timber Co. Ltd. Sean Steuart, CFA

(WFG-N, WFG-T) US$74.17 | C$93.77
Upgrading to ACTION LIST BUY After Recent Correction

Event Recommendation: ACTION LIST BUYá

Prior: BUY
We are raising our earnings estimates for West Fraser to reflect positive revisions to
our 2022 and 2023 commodity price deck across lumber, structural panels, pulp & Risk: HIGH
paper (tempered by higher cost and lower volume assumptions). To reflect a more 12-Month Target Price: US$120.00â
cautious valuation environment, we are lowering our adjusted trend EV/EBITDA Prior: US$125.00
target multiple to 5.5x from 6.2x previously. The net impact is a lower 12-month target 12-Month Dividend (Est.): US$1.00
price of $120.00 (down from $125.00). Given a sharp share-price and valuation
correction since mid-January, we are comfortable upgrading our rating to 12-Month Total Return: 63.1%
ACTION LIST BUY from Buy. Market Data (US$)
Impact: POSITIVE Current Price US$74.17
52-Week Range $64.72 - $102.61
■ Notwithstanding weaker lumber and panel prices in recent weeks, strong Mkt Cap (f.d.) ($mm) $7,886.5
EV ($mm) $6,817.5
commodity price momentum through most of Q1/22 necessitates higher
Current Dividend $1.00
wood product price estimates. Our average 2022 benchmark wood product Dividend Yield 1.3%
price forecasts increase 15% for Western SPF lumber (to $834/Mfbm) and 46% Avg. Daily Trading Vol. 321,853
for North Central OSB (to $737/Msf). Our 2023 wood-product price assumptions Financial Data (US$)
increase as well, although not as materially. We are also raising our average 2022 Fiscal Y-E December
and 2023 pulp-price estimates across relevant regions/grades. Other changes Shares O/S (f.d)(mm) 106.3
include higher cost forecasts (inputs and freight) and lower near-term volume Float Shares (mm) 90.1
Net Cash ($mm) $1,069.0
estimates (ongoing shipping headwinds and recent company-specific initiatives).
BVPS (f.d.) $72.00
■ The exceptional free-cash-flow window is expected to extend into 2023. Estimates (US$)
Based on our revised forecasts, implied annual FCF yields are 24% in 2022 Year 2020A 2021A 2022E 2023E
and 13% in 2023. We believe that the company is poised to complement asset- EBITDA ($mm) 1,813.0 4,569.0 3,615.4 1,957.6
base growth initiatives with ongoing aggressive capital returns to shareholders. EBITDA ($mm) (old) – – 3,051.4 1,900.3
EPS (Adj.) 8.43 26.61 20.60 9.01
Adjusted for expectations over the next two years, we estimate that West Fraser EPS (Adj.) (old) – – 16.51 8.46
is trading at a steep discount to pro forma book value (0.7x 2023E P/BV) and 2.6x FCF/Shr 11.98 27.72 17.47 9.83
trend EV/EBITDA (long-term average >5.5x). FCF/Shr (old) – – 14.49 9.03

■ West Fraser's share price has declined 28% from the Q1/22 peak. This EBITDA ($mm) Quarterly Estimates (US$)
Year 2020A 2021A 2022E 2023E
pullback is consistent with direct comps, but, in our view, opens a compelling
Q1 144.0 1,008.0 1,635.1 –
investment window, given the company's long-term ROCE track record, robust Q2 187.0 2,160.0 1,056.4 –
capital structure, and scale. Q3 739.0 786.0 609.8 –
Q4 743.0 615.0 314.1 –
TD Investment Conclusion
Valuations
We expect that West Fraser will remain aggressive in pursuing asset-base growth Year 2020A 2021A 2022E 2023E
EV/EBITDA 3.8x 1.5x 1.9x 3.5x
while returning surplus capital to shareholders. In our view, West Fraser is attractively
P/E (Adj.) 8.8x 2.8x 3.6x 8.2x
valued, especially given our forecast of above-trend mid-term free cash flow.
Supplemental Data
Year 2020A 2021A 2022E 2023E
WSPF US$/Mfbm 553 875 834 540
SYP US$/Mfbm 599 926 803 525
NC OSB US$/Msf 439 807 737 420
CH NBSK US$/mt 584 849 853 755
110
WFG-N: Price
110
Company Profile Historical metrics reflect the consolidated West Fraser and Norbord.
West Fraser is the largest North American wood All figures in US$, unless otherwise specified
100 100
product manufacturer, with 9% of softwood lumber
90 90
capacity and 31% of OSB capacity. The company
80 80 also has exposure to other engineered wood
70 70 products, pulp, and paper, with an operating
60 60 presence across North America and Europe.
50 50
Jun-21 Aug-21 Oct-21 Dec-21 Feb-22 Apr-22

Please see the final pages of this document for important disclosure information. Page 1 of 8
 April 12, 2022

Details
Exhibit 1 shows indexed prices of relevant forest product commodities since the
beginning of 2018. For context, H1/18 marked a period of nominal records for commodity
lumber and OSB prices at that time. Reference lumber and OSB prices peaked in
March and current benchmarks are down 25‒26% in recent weeks. In our view, the
current wood-product price correction from another exceptional peak was inevitable.
Current benchmark lumber and OSB prices are still 71% and 111% higher than their
respective peaks four years ago and ~2x‒3x our estimates of respective mid-cycle (trend)
potential. In our view, key commodity prices in this sector are poised to stay above trend
over our two-year forecast horizon, even as lumber and OSB supply additions
accumulate and markets moderate.

Exhibit 1. Indexed Benchmark Forest Product Commodity Prices

4.5

4.0 Lumber and structural panel (OSB and

Indexed to 1.0 at January 2018

plywood) prices are pulling back from

3.5 another remarkable peak.
3.0
Pulp prices are strengthening as shipping
2.5
constraints add market tension.

2.0

1.5

1.0

0.5
Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22
Lumber Composite (N.A., US$) NBSK Pulp (China, US$)
Newsprint (N.A., US$) OSB Composite (N.A., US$)
Canadian Plywood (C$)
Source: Random Lengths, Fastmarkets RISI

We expect that Q1/22 will mark West Fraser’s cyclical earnings peak, but we still
forecast a compelling free cash flow (FCF) profile through 2023. Our 2023
benchmark Western SPF ($540/Mfbm) and North Central OSB ($420/Msf) price forecasts
are 50% and 56% below respective current price levels. Our mid-term earnings forecasts
for West Fraser are further tempered by cost inflation assumptions (fibre, resin, labour,
and especially freight). Despite this, we expect that the company will generate FCF yields
of 24% in 2022 and 13% in 2023. The company has an already strong balance sheet (net
cash of $1.1 billion) that we expect will strengthen further over the next two years.

West Fraser has acted on recent share-price pressure via its normal course issuer
bid (NCIB). In Q1/22, the company repurchased 2.6 million shares (>2% of the total
number of shares outstanding at year-end) at an average price of $90.60/share for $233
million — 80% of this amount was completed in March 2022. In 2021, the company
bought back 17.4 million shares (14% of the total number of shares outstanding following
the Q1/21 Norbord acquisition) for $1.3 billion through both its NCIB and the Q3/21
substantial issuer bid (SIB). West Fraser’s current 10% NCIB expires in February 2023,
and it has 7.9 million shares remaining of the original 10.2 million authorization. We
believe that another SIB could complement normal buyback activity and the modest
regular dividend this year.

Page 2 of 8
 April 12, 2022

Outlook
Largely based on the changes to our commodity price deck, our adjusted EBITDA
forecasts increase 18% in 2022 and 3% in 2023. Our revised estimates are 6% above
consensus for 2022 and 5% below consensus for 2023.

Our Q1/22 EBITDA forecast of $1.635 billion for West Fraser is 22% above the
consensus estimate. Average Q1/22 reference composite lumber and OSB prices
surged 83% and 98%, respectively, q/q before peaking in late-March. Positive commodity
price momentum was complemented by fibre cost relief in B.C. (lower stumpage rates
tied to a lag effect from the H2/21 lumber price pullback) and carryover of good price
momentum from late-2021 for the European panels business. Q1/22 earnings/cash flow
headwinds included ongoing shipping constraints (particularly in western Canada),
downtime to manage finished goods storage, a seasonal inventory increase, and broad-
based cost inflation (e.g., resins, chemicals, freight).

Valuation

Based on our trend (mid-cycle) estimates, West Fraser is trading at 4.3x TEV/EBITDA,
matching the Canadian lumber-group average of 4.3x. Adjusting for expected free cash
flow until the end of 2023, West Fraser’s trend EV/EBITDA drops to 2.6x, slightly above
the direct peer-group average of 2.4x, but below the company’s historical trading ranges.
Given West Fraser’s scale, growth platform, and ROCE track-record, we believe that a
larger valuation premium over its lumber-focused peers is warranted.

Page 3 of 8
 April 12, 2022

Exhibit 2. West Fraser Timber Relative Valuation

Share Current Market TEV/EBITDA Debt/
Lumber & Integrated Ticker Currency Price Cap (mm) 2020A 2021A 2022E 2023E Trend P/B Cap

Canfor Corp. CFP-T CAD $23.33 $2,904 1.9x 1.0x 1.3x 2.1x 3.7x 0.8x nmf
Conifex Timber Inc. (1) CFF-T CAD $1.83 $80 2.7x 2.5x 4.3x nmf N/A 0.6x 29%
Interfor Corp. IFP-T CAD $32.30 $1,964 4.6x 1.9x 1.9x 3.7x 4.8x 1.2x 20%
Resolute Forest Products Inc. RFP-N,T USD $12.26 $939 4.6x 1.5x 1.8x 3.0x 4.4x 0.6x 11%
Western Forest Products Inc. WEF-T CAD $1.93 $640 4.4x 1.7x 2.3x 2.6x 4.2x 1.0x nmf
Lumber & Integrated Peer Group Average 3.7x 1.7x 2.3x 2.8x 4.3x 0.9x 20%

Engineered Wood Products & Share Current Market TEV/EBITDA Debt/

Value-Added Building Products Ticker Currency Price Cap (mm) 2020A 2021A 2022E 2023E Trend P/B Cap

Boise Cascade Company (1) BCC-N USD $68.82 $2,735 2.4x 2.7x 4.4x 5.7x N/A 2.0x nmf
James Hardie Industries PLC (1) JHX-AU AUD $39.78 $13,167 22.7x 14.0x 11.0x 10.1x N/A 10.3x 40%
Louisiana-Pacific Corp. LPX-N USD $59.32 $5,078 6.5x 2.6x 2.9x 5.3x 7.0x 4.1x nmf
Owens Corning (1) OC-N USD $85.04 $8,649 nmf 5.6x 5.1x 5.0x N/A 2.0x 34%
Simpson Manufacturing Co. Inc. (1) SSD-N USD $103.07 $4,477 12.7x 13.6x 9.6x 8.8x N/A 3.8x nmf
Trex Co. Inc. (1) TREX-N USD $63.67 $7,362 nmf nmf 17.0x 15.0x N/A 10.1x nmf
UFP Industries Inc. (1) UFPI-N USD $76.19 $4,754 7.8x 6.5x 5.7x 5.6x N/A 2.4x 5%
EWP & Building Products Peer Group Average (ex. JHX & TREX) 7.3x 6.2x 5.5x 6.1x N/A 2.8x 19%

Share Current Market TEV/EBITDA Debt/

Pulp, Paper & Other Ticker Currency Price Cap (mm) 2020A 2021A 2022E 2023E Trend P/B Cap

Canfor Pulp Products Inc. CFX-T CAD $4.97 $324 11.5x 2.6x 4.3x 2.5x 2.6x 0.7x nmf
Mercer International Inc. MERC-Q USD $14.28 $940 9.5x 3.8x 3.4x 4.3x 5.1x 1.4x 56%
Weyerhaeuser Co. (1) WY-N USD $39.02 $29,302 13.7x 8.2x 9.9x 13.2x N/A 2.7x 24%
Pulp, Paper & Other Peer Group Average 11.6x 4.9x 5.9x 6.7x 3.9x 1.6x 40%

Peer Group Average (ex. High/Low) 7.3x 4.4x 5.1x 5.8x N/A 2.5x 26%

West Fraser Timber Co. Ltd. WFG-N,T USD $74.17 $7,887 3.8x 1.5x 1.9x 3.5x 4.3x 1.0x nmf

Notes:
(1) Multiples are based on Bloomberg consensus estimates.
Source: TD Securities Inc., company reports, Thomson One, Bloomberg.

Justification of Target Price

Our 12-month target price of $120.00 for West Fraser is based on a 5.5x target
EV/EBITDA multiple using our trend EBITDA estimate. To capture changing net-debt
expectations, we adjust our enterprise-value calculation with expected free cash flows
through 2023. Our average target multiple for relevant lumber and panel producers is
4.8x.

Key Risks to Target Price

Key risks to our target price include: 1) weaker-than-expected housing activity; 2) North
American lumber and OSB market competition; 3) changing commodity prices; 4) a
potential slowdown in offshore demand; 5) foreign currency fluctuations; 6) long-term
B.C. fibre shortage; 7) equipment failures, production disruptions, environmental
liabilities, labour disruptions, and/or natural disasters; 8) input cost inflation; 9) acquisition
integration risk; 10) failure to achieve the anticipated synergies; 11) potential First Nations
claims to timber; 12) softwood lumber trade dispute between Canada and the U.S.; and
13) potential direct and indirect downtime tied to COVID-19.

Page 4 of 8
 April 12, 2022

Exhibit 3. West Fraser Timber Co. Ltd. Summary

Financial Data 2020A 2021A 2022E 2023E Trend Segmented Operating Metrics 2020A 2021A 2022E 2023E Trend
EBITDA (ex. items, $mm) 1,813.0 4,569.0 3,615.4 1,957.6 1,573.7 Exchange rate (US$/C$) $0.75 $0.80 $0.79 $0.80 $0.80
EPS (ex. items) 8.43 26.61 20.60 9.01 6.40
FCF ($mm) 1,478.0 3,155.0 1,857.6 1,045.6 1,053.1 Lumber (1)
FCF/share 11.98 27.72 17.47 9.83 9.90 Shipments (MMfbm) 6,075 5,825 6,150 6,715 6,785
BVPS 29.18 72.00 91.60 99.62 n/a Reference Prices (US$/Mfbm)
Western SPF (#2 & better) $553 $875 $834 $540 $460
Valuation Metrics 2020A 2021A 2022E 2023E Trend Southern Yellow Pine (#2 & better, East) $599 $926 $803 $525 $505
EV/EBITDA 4.4x 2.0x 1.4x 2.1x 2.6x Avg. price realization (incl. chips & logs, $/Mfbm) $538 $824 $696 $548 $520
Trailing EV/EBITDA 3.8x 1.5x 1.9x 3.5x 4.3x Sales ($mm) 3,266.0 4,802.0 4,279.1 3,681.2 3,531.1
P/B 2.2x 1.3x 0.8x 0.7x nmf EBITDA ($mm) 844.0 1,973.0 1,160.7 557.6 554.9
P/E 8.8x 2.8x 3.6x 8.2x 11.6x EBITDA margin 26% 41% 27% 15% 16%
FCF Yield 18.6% 29.1% 23.6% 13.3% 13.4%
* Historical financials reflect West Fraser and Norbord pro forma consolidated. Panels (1)
Shipments (MMsf)
Statement of Operations ($mm) 2020A 2021A 2022E 2023E Trend North American OSB (3/8" basis) 5,787 5,674 6,250 6,900 7,650
European Panels (3/8" basis) 1,879 1,716 1,990 2,130 2,200
Sales 6,781.0 10,518.0 10,392.2 8,700.3 7,898.0 Reference: North Central OSB (US$/Msf, 7/16") $439 $807 $737 $420 $295
Sales ($mm) 2,875.0 4,989.0 5,341.9 4,295.2 3,717.0
Cost of sales 3,795.0 4,645.0 5,351.2 5,305.5 4,997.4 EBITDA ($mm) 986.0 2,615.0 2,478.9 1,267.8 935.4
Selling and administrative 255.0 312.0 335.2 380.4 366.3 EBITDA margin 34% 52% 46% 30% 25%
Depreciation and amortization 376.0 584.0 636.4 649.1 664.9
Other expense 864.0 1,032.0 1,090.4 1,056.8 960.7 Pulp and Paper (1)
Operating earnings (loss) 1,491.0 3,945.0 2,979.0 1,308.4 908.8 Shipments (000 tonnes)
Pulp 1,132 1,033 1,005 985 970
Net interest expense (income) 71.0 45.0 19.3 13.1 13.1 Newsprint 110 114 104 104 110
Tax expense (recovery) 353.0 951.0 769.5 336.8 215.0 Reference Pulp Prices (US$/tonne)
Other expense (income) 21.0 2.0 0.0 0.0 0.0 NBSK (North America, list) $1,138 $1,479 $1,614 $1,500 $1,150
BCTMP (China, transaction) $464 $533 $577 $550 $535
Net income (loss) 1,046.0 2,947.0 2,190.2 958.5 680.7 Avg. pulp & paper price realization ($/tonne) $522 $634 $695 $665 $602
Sales ($mm) 648.0 727.0 771.2 723.8 649.9
EPS 8.48 26.50 20.60 9.01 6.40 EBITDA ($mm) 0.0 15.0 35.7 152.1 103.4
EPS (ex. items) 8.43 26.61 20.60 9.01 6.40 EBITDA margin 0% 2% 5% 21% 16%
* Historical financials reflect West Fraser and Norbord pro forma consolidated.
Consolidated 2020A 2021A 2022E 2023E Trend
Statement of Cash Flows ($mm) 2020A 2021A 2022E 2023E
Consolidated sales ($mm) 6,781.0 10,518.0 10,392.2 8,700.3 7,898.0
Net income (loss) 1,046.0 2,947.0 2,190.2 958.5 Segmented EBITDA ($mm) 1,830.0 4,603.0 3,675.4 1,977.6 1,593.7
Depreciation and amortization 376.0 584.0 636.4 649.1 Corporate EBITDA ($mm) (17.0) (34.0) (60.0) (20.0) (20.0)
Deferred income taxes 220.0 725.0 77.0 33.7 Consolidated EBITDA ($mm) 1,813.0 4,569.0 3,615.4 1,957.6 1,573.7
Other operating cash flows 11.0 (635.0) (312.0) 0.0 EBITDA margin 27% 43% 35% 22% 20%
Changes in non-cash working capital 139.0 (69.0) (193.9) (35.7)
CF from operating activities 1,792.0 3,552.0 2,397.6 1,605.6 2022E Segmented Breakdown (inner circle = sales; outer circle = EBITDA)

Capital expenditures (284.0) (635.0) (580.0) (560.0) Pulp &

Other investing cash flows 10.0 349.0 0.0 0.0 Paper
CF from investing activities (274.0) (286.0) (580.0) (560.0) Sales 1% EBITDA
Lumber 41% Pulp & 32%
CF from financing activities Panels 51% Paper 67% Lumber
(540.0) (2,164.0) (105.9) (105.9)
32%
Pulp & Paper 7% 8% 1%
Total cash flow 978.0 1,102.0 1,711.7 939.7 Lumber
* Historical financials reflect West Fraser and Norbord pro forma consolidated. 41%

Balance Sheet ($mm) 2020A 2021A 2022E 2023E

Panels
51%
Cash 1,029.0 1,568.0 3,279.7 4,219.4
Other current assets 1,339.0 1,649.0 1,895.2 1,876.3 Panels
Property, plant and equipment 3,446.0 4,468.0 4,411.6 4,322.5 67%
Other assets 835.0 2,748.0 2,748.0 2,748.0
6,649.0 10,433.0 12,334.5 13,166.2

Short-term debt 0.0 0.0 0.0 0.0

Other current liabilities 985.0 1,206.0 946.3 1,390.7 2022 Quarterly Estimates Q1E Q2E Q3E Q4E
Long-term debt 1,158.0 499.0 499.0 0.0 EBITDA (ex. items, $mm) 1,635.1 1,056.4 609.8 314.1
Other liabilities 908.0 1,072.0 1,149.0 1,182.6 EPS (ex. items) 10.29 6.22 3.08 1.02
Shareholders' equity 3,598.0 7,656.0 9,740.2 10,592.9 FCF/share 3.25 7.06 4.79 2.36
6,649.0 10,433.0 12,334.5 13,166.2 * Historical financials reflect West Fraser and Norbord pro forma consolidated.

Net debt (cash) 137.0 (1,069.0) (2,780.7) (3,720.4) Notes:

Net D/D+E 3.7% nmf nmf nmf (1) WSPF = Western Spruce Pine Fir Lumber; SYP = Southern Yellow Pine Lumber;
Net debt-to-EBITDA 0.1x nmf nmf nmf MDF = Medium Density Fibreboard; NBSK = Northern Bleached Softwood Kraft (North America);
* Historical financials reflect West Fraser and Norbord pro forma consolidated. BCTMP = Bleached Chemi-Thermomechanical Pulp (China).
Source: Company reports, TD Securities Inc.

Page 5 of 8
Action Note
Equity Research April 12, 2022

TD Securities Equity Research Disclosures

 Company Ticker Disclosures
West Fraser Timber Co. Ltd. WFG-N | WFG-T 2, 4, 9

1. TD Securities Inc., TD Securities (USA) LLC or an affiliated company has managed or co-managed a public offering of securities within the last 12 months with respect to the subject
company.
2. TD Securities Inc., TD Securities (USA) LLC or an affiliated company has received compensation for investment banking services within the last 12 months with respect to the
subject company.
3. TD Securities Inc., TD Securities (USA) LLC or an affiliated company expects to receive compensation for investment banking services within the next three months with respect to
the subject company.
4. TD Securities Inc. or TD Securities (USA) LLC has provided investment banking services within the last 12 months with respect to the subject company.
5. A long position in the securities of the subject company is held by the research analyst, by a member of the research analyst’s household, or in an account over which the research
analyst has discretion or control.
6. A short position in the securities of the subject company is held by the research analyst, by a member of the research analyst’s household, or in an account over which the research
analyst has discretion or control.
7. A long position in the derivative securities of the subject company is held by the research analyst, by a member of the research analyst’s household, or in an account over which the
research analyst has discretion or control.
8. A short position in the derivative securities of the subject company is held by the research analyst, by a member of the research analyst’s household, or in an account over which
the research analyst has discretion or control.
9. TD Securities Inc. and/or an affiliated company is a market maker, or is associated with the specialist that makes a market, in the securities of the subject company.
10. TD Securities Inc. and/or affiliated companies own 1% or more of the equity securities of the subject company.
11. A partner, director or officer of TD Securities Inc. or TD Securities (USA) LLC, or a research analyst involved in the preparation of this report has, during the preceding 12 months,
provided services to the subject company for remuneration.
12. This security has Subordinate voting shares.
13. This security has Restricted voting shares.
14. This security has Non-voting shares.
15. This security has Variable voting shares.
16. This security has Limited voting shares.

Additional Important Disclosures

Price Graphs
Full disclosures for all companies covered by TD Securities can be viewed at https://www.tdsresearch.com/equities/welcome.important.disclosure.action by TD Securities' institutional
equity clients.

Distribution of Research Ratings^ Investment Services Provided*

100%

REDUCE - 0.6% 77.38%

75%
NOT RATED - 0.3%

50%
HOLD - 24.4%
BUY - 74.7%

25% 22.02%

0.6% 0%
0%
BUY HOLD NOT REDUCE
RATED

Current as of: April 12, 2022

^ Percentage of subject companies under each rating category: BUY (covering ACTION LIST BUY,
BUY and SPECULATIVE BUY ratings), HOLD, and REDUCE (covering TENDER and REDUCE
ratings) and NOT RATED (covering UNDER REVIEW, SUSPENDED, and NOT RATED).
* Percentage of subject companies within each of the four categories (BUY, HOLD, REDUCE, and
NOT RATED) for which TD Securities Inc. has provided investment banking services within the last
12 months.

Definition of Research Ratings

ACTION LIST BUY: The stock's total return is expected to exceed a minimum of 15% (with higher thresholds for less liquid, more risky securities) over the next 12 months and it is a
top pick in the Analyst's sector.
BUY: The stock's total return is expected to exceed a minimum of 10% (with higher thresholds for less liquid, more risky securities) over the next 12 months.
SPECULATIVE BUY: The stock's total return is expected to exceed a minimum of 30% over the next 12 months (with higher thresholds for less liquid securities); however, there is material
event risk associated with the investment that could result in a significant loss.

Page 6 of 8
Action Note
Equity Research April 12, 2022

HOLD: The stock's total return is expected to be between 0% and 10%, (with higher thresholds for less liquid, more risky securities) over the next 12 months.
TENDER: Investors are advised to tender their shares to a specific offer for the company's securities or to support a proposed combination reflecting our view that a superior offer
is not forthcoming.
REDUCE: The stock's total return is expected to be negative over the next 12 months.
SUSPENDED: Due to evolving circumstances, we can no longer generate what we consider a defensible target price and rating at the current time.
UNDER REVIEW: Our rating is under review pending additional information and/or analysis. The prior rating should not be relied on.
NOT RATED: We do not currently produce a recommendation and a target price on this security.
Risk ratings are relative to other companies in the TD Securities Equity Research coverage universe. In order of increasing risk, our risk ratings are LOW, MEDIUM, HIGH, and
SPECULATIVE. These risk ratings are not meant to be compared to ratings on other securities and asset classes outside our Equity Research coverage universe.
Overall Risk Rating in order of increasing risk: Low (6.9% of coverage universe), Medium (42.8%), High (43.1%), Speculative (7.2%)

Research Dissemination Policy

TD Securities makes its research products available in electronic and/or printed formats. If there are any subsequent material changes to the reports it publishes, TD Securities will
as soon as practicable distribute such reports with the relevant changes to its institutional clients who are entitled to receive them. Entitled institutional clients may also receive our
research via third-party platforms including, but not limited to, Bloomberg, FactSet, Refinitiv, and S&P Capital IQ. All research is available by password to entitled institutional clients
at https://www.tdsresearch.com/equities. TD Securities may also update proprietary models; these models may be obtained by entitled institutional clients by contacting the research
analyst directly. There is no planned frequency of updates to these models.

Analyst Certification
Each analyst of TD Securities Inc. whose name appears on page 1 of this research report hereby certifies that (i) the recommendations and opinions expressed in the research report
accurately reflect the research analyst's personal views about any and all of the securities or issuers discussed herein that are within the analyst’s coverage universe and (ii) no part
of the research analyst's compensation was, is, or will be, directly or indirectly, related to the provision of specific recommendations or views expressed by the research analyst in
the research report.

Disclaimer
This material is for general informational purposes only and is not investment advice nor does it constitute an offer, recommendation or solicitation to buy or sell a particular financial instrument. It does
not have regard to the specific investment objectives, financial situation, risk profile or the particular needs of any specific person who may receive this material. No representation is made that the
information contained herein is accurate in all material respects, complete or up to date, nor that it has been independently verified by TD Securities. Recipients of this analysis or report are to contact
the representative in their local jurisdiction with regards to any matters or questions arising from, or in connection with, the analysis or report.
Historic information regarding performance is not indicative of future results and investors should understand that statements regarding future prospects may not be realized. All investments entail
risk, including potential loss of principal invested. Performance analysis is based on certain assumptions, the results of which may vary significantly depending on the modelling inputs assumed. This
material, including all opinions, estimates and other information, constitute TD Securities’ judgment as of the date hereof and is subject to change without notice. The price, value of and income from
any of the securities mentioned in this material can fall as well as rise. Any market valuations contained herein are indicative values as of the time and date indicated. Such market valuations are
believed to be reliable, but TD Securities does not warrant their completeness or accuracy. Different prices and/or valuations may be available elsewhere and TD Securities suggests that valuations
from other sources be obtained for comparison purposes. Any price or valuation constitutes TD Securities’ judgment and is subject to change without notice. Actual quotations could differ subject
to market conditions and other factors.
TD Securities disclaims any and all liability relating to the information herein, including without limitation any express or implied representations or warranties for, statements contained in, and omissions
from, the information. TD Securities is not liable for any errors or omissions in such information or for any loss or damage suffered, directly or indirectly, from the use of this information. TD Securities
may have effected or may effect transactions for its own account in the securities described herein. No proposed customer or counterparty relationship is intended or implied between TD Securities
and a recipient of this document.
TD Securities makes no representation as to any tax, accounting, legal or regulatory issues. Investors should seek their own legal, financial and tax advice regarding the appropriateness of investing
in any securities or pursuing any strategies discussed herein. Investors should also carefully consider any risks involved. Any transaction entered into is in reliance only upon the investor’s judgment
as to financial, suitability and risk criteria. TD Securities does not hold itself out to be an advisor in these circumstances, nor do any of its representatives have the authority to do so.
The information contained herein is not intended for distribution to, or use by, any person in any jurisdiction where such distribution or use would be contrary to applicable law or regulation or which
would subject TD Securities to additional licensing or registration requirements. It may not be copied, reproduced, posted, transmitted or redistributed in any form without the prior written consent
of TD Securities.
If you would like to unsubscribe from our email distribution lists at any time, please contact your TD Securities Sales Contact. If you are located in Europe, Asia, Australia or New Zealand you may
also unsubscribe by emailing us at Privacy.EAP@tdsecurities.com.
For more information, refer to our Privacy Policy. https://www.tdsecurities.com/ca/en/privacy-security
Australia
If you receive this document and you are domiciled in Australia, please note that this report is intended to be issued for general information purposes only and distributed through Toronto Dominion
(South East Asia) Limited ("TDSEA"). TDSEA does not hold itself out to be providing financial advice in these circumstances. TD Securities is a trademark and represents certain investment dealing
and advisory activities of Toronto-Dominion Bank and its subsidiaries, including TDSEA. The Toronto-Dominion Bank is not an authorized deposit-taking or financial services institution in Australia.
TDSEA is a holder of an Australian Financial Services Licence (528885) and is regulated in Australia by the Australian Securities and Investments Commission.
Canada
Canadian clients wishing to effect transactions in any security discussed herein should do so through a qualified salesperson of TD Securities or TD Securities Inc. TD Securities Inc. is a member
of the Canadian Investor Protection Fund.
China, India, and South Korea

Page 7 of 8
Action Note
Equity Research April 12, 2022

Insofar as the document is received by any persons in the People's Republic of China (“PRC”), India and South Korea, it is intended only to be issued to persons who have the relevant qualifications to
engage in the investment activity mentioned in this document. The recipient is responsible for obtaining all relevant government regulatory approvals/licenses themselves, and represents and warrants
to The Toronto-Dominion Bank that the recipient's investments in those securities do not violate any law or regulation, including, but not limited to, any relevant foreign exchange regulations and/or
overseas investment regulations. The Toronto-Dominion Bank has a representative office in Shanghai, Mumbai and Seoul which should be contacted for any general enquiry related to The Toronto-
Dominion Bank or its business. However, neither any of the Toronto-Dominion Bank offshore branches/subsidiaries nor its representative offices are permitted to conduct business within the borders
of the PRC, India and South Korea. In locations in Asia where the Bank does not hold licenses to conduct business in financial services, it is not our intention to, and the information contained in this
document should not be construed as, conducting any regulated financial activity, including dealing in, or the provision of advice in relation to, any regulated instrument or product. This publication is
for general information only, without addressing any particular needs of any individual or entity, and should not be relied upon without obtaining specific advice in the context of specific circumstances.
Hong Kong SAR (China)
This document, which is intended to be issued in Hong Kong SAR (China) ("Hong Kong") only to Professional Investors within the meaning of the Securities and Futures Ordinance (the "SFO") and the
Securities and Futures (Professional Investor) Rules made under the SFO, has been distributed through Toronto-Dominion Bank, Hong Kong Branch, which is regulated by the Hong Kong Monetary
Authority and the Securities and Futures Commission.
Japan
For Japanese residents, please note that if you have received this document from The Toronto-Dominion Bank entities based outside Japan, it is being provided to qualified financial institutions (“QFI”)
only under a relevant exemption to the Financial Instruments and Exchange Act.
If you have received this document from TD Securities (Japan) Co., Ltd., it is being provided only to institutional investors. TD Securities (Japan) Co., Ltd. is regulated by the Financial Services Agency
of Japan and is distributing this document in Japan as a Type 1 Financial Instruments Business Operator registered with the Kanto Local Finance Bureau under registration number, Kinsho 2992,
and a member of Japan Securities Dealers Association.
New Zealand
The Toronto-Dominion Bank is not a “registered bank” in New Zealand under the Reserve Bank Act 1989.
Singapore
This report is distributed in Singapore by The Toronto-Dominion Bank, Singapore Branch, and recipients in Singapore of this report are to contact The Toronto-Dominion Bank, Singapore Branch in
respect of any matters arising from, or in connection with, this report. The Toronto-Dominion Bank, Singapore Branch is regulated by the Monetary Authority of Singapore. Where this report is issued or
promulgated in Singapore, it is only intended for distribution to a person who is an accredited investor, expert investor or institutional investor as defined in the Securities and Futures Act (Cap. 289), the
Securities and Futures (Prescribed Specific Classes of Investors) Regulations 2005, or the Securities and Futures (Classes of Investors) Regulations 2018 issued by the Monetary Authority of Singapore.
United Kingdom and Europe
This document is prepared, issued or approved for issuance in the UK by TD Securities Limited and in Europe by TD Global Finance unlimited company in respect of investment business. The
Toronto-Dominion Bank is authorised by the Prudential Regulation Authority and subject to regulation by the Financial Conduct Authority and limited regulation by the Prudential Regulation Authority.
TD Securities Limited is authorised and regulated by the Financial Conduct Authority. TD Global Finance unlimited company, trading as TD Securities, is regulated by the Central Bank of Ireland.
Insofar as the document is issued in or to the United Kingdom, it is intended only to be issued to persons who (i) are persons falling within Article 19(5) ("Investment professional") of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the "Financial Promotion Order"), (ii) are persons falling within Article 49(2)(a) to (d) ("High net worth companies,
unincorporated associations, etc.") of the Financial Promotion Order, or (iii) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the
Financial Services and Markets Act 2000) in connection with the issue or sale of any securities may otherwise lawfully be communicated or caused to be communicated. Insofar as the document is
issued in or to the European Union, it is intended only to be issued to persons categorised as 'Per Se Professional' or 'Eligible Counterparties' as defined in S.I. No 375 of 2017, European Union (Markets
in Financial Instruments) Regulations 2017, Schedule 2. Clients in the United Kingdom wishing to effect transactions in any security discussed herein should do so through a qualified salesperson of
TD Securities Limited. European clients wishing to effect transactions in any security discussed herein should do so through a qualified salesperson of TD Global Finance unlimited company. Insofar as
the information in this report is issued in (i) the UK, it has been issued with the prior approval of TD Securities Limited and (ii) in Europe, it has been issued with the prior approval of TD Global Finance
unlimited company. Article 20 Market Abuse Regulation 596/2014 ("MAR") requires market participants who produce or disseminate Investment Recommendations or other information recommending
or suggesting an investment strategy to take reasonable care that such information is objectively presented, and to disclose their interests or indicate conflicts of interest. In accordance with the MAR
requirements, see the Investment Recommendations Disclaimer for relevant information in relation to The Toronto-Dominion Bank – London Branch, TD Bank Europe Limited, TD Securities Limited
and TD Global Finance unlimited company. https://www.tdsecurities.com/tds/document/MAR-IR-Disclaimer
United States
U.S. clients wishing to effect transactions in any security discussed herein must do so through a registered representative of TD Securities (USA) LLC.
TD Securities is a trademark of The Toronto-Dominion Bank and represents TD Securities Inc., TD Securities (USA) LLC and TD Securities Limited and certain investment and corporate banking
activities of The Toronto-Dominion Bank and its subsidiaries.
© Copyright 2022 The Toronto-Dominion Bank. All rights reserved.
Full disclosures for all companies covered by TD Securities can be viewed at https://www.tdsresearch.com/equities/welcome.important.disclosure.action

Page 8 of 8