Here's Why Pembina Pipeline (PBA) Declined in Q2

ClearBridge Investments, an investment management company, released its “ClearBridge Global Infrastructure Income Strategy” second quarter 2025 investor letter. A copy of the letter can be downloaded here. Markets rebounded in the second quarter of 2025 after a first-quarter correction, overcoming tariff, growth, and geopolitical concerns. Initially, stocks fell following President Trump's announcement of reciprocal tariffs on April 2, but a delay in their implementation, several bilateral trade deals, and a softer stance from Trump on China and Federal Reserve policy helped improve the outlook. Listed infrastructure proved resilient during April's market fluctuations, outperforming the broader market, and maintained stability as equities rebounded in May and June. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second quarter 2025 investor letter, ClearBridge Global Infrastructure Income Strategy highlighted stocks such as Pembina Pipeline Corporation (NYSE:PBA). Pembina Pipeline Corporation (NYSE:PBA) is an energy transportation and midstream services provider. The one-month return of Pembina Pipeline Corporation (NYSE:PBA) was -4.24%, and its shares lost 2.49% of their value over the last 52 weeks. On July 10, 2025, Pembina Pipeline Corporation (NYSE:PBA) stock closed at $36.83 per share, with a market capitalization of $21.575 billion.

ClearBridge Global Infrastructure Income Strategy stated the following regarding Pembina Pipeline Corporation (NYSE:PBA) in its second quarter 2025 investor letter:

"U.S. energy infrastructure company ONEOK and Canadian energy infrastructure company Pembina Pipeline Corporation (NYSE:PBA) were the largest detractors. Pembina Pipeline provides transportation and midstream services for the energy industry in North America, with a focus on the Western Canadian Sedimentary Basin (WCSB). The market is currently focused on the outcome of toll renegotiations for the Alliance Pipeline, which has significantly over-earned in the last several years. We believe the market is overreacting to the potential normalization in the tolling rate, which we believe will have only a low-single-digit impact on a group earnings basis. Looking beyond this, Pembina is positioned as a market leader in providing pipeline and midstream processing services to the fast-growing WCSB, which is seeing a step change in growth driven by liquified natural gas (LNG) and liquified petroleum gas (LPG) exports and a growing petrochemical industry in Alberta."

Pembina Pipeline Corporation (NYSE:PBA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 25 hedge fund portfolios held Pembina Pipeline Corporation (NYSE:PBA) at the end of the first quarter, compared to 17 in the previous quarter. While we acknowledge the potential of PBA as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Pembina Pipeline Corporation (NYSE:PBA) and shared the list of small-cap energy stocks hedge funds are buying. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.