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Gas station and convenience store operator Parkland (PKI.TO) has become riskier for investors as the company attempts to turn the corner on an 11-week refinery outage while fighting a public war-of-words with its largest shareholder.

That’s according to RBC Capital Markets analyst Luke Davies, who slashed $4 from his $54 price target on Toronto-listed Parkland shares on Tuesday.

Calgary-based Parkland operates more than 4,000 fuel and convenience locations in 26 countries under banners including On the Run, Chevron, Pioneer and Ultramar. It also owns frozen food retailer M&M Food Market.

The company is set to report first-quarter financial results on May 1. Earlier this month, Parkland warned that the unplanned shutdown at its Burnaby, B.C. refinery could cause up to $65 million in lost profit in Q1. The facility shut down in January, and resumed operations on March 29.

Despite this, Parkland has left its 2024 profit guidance unchanged.

“While 2024 guidance remains intact, we believe the risk profile has increased with any prior buffer largely exhausted,” Davies wrote in a note to clients on Tuesday.

At the same time, top shareholder Simpson Oil is now pushing for Parkland to explore a potential sale. The Cayman Islands-based company owns roughly 20 per cent of Parkland’s stock, and has been an investor since January 2019.

In December, two of Simpson’s nominees to Parkland’s board of directors abruptly left the company. On April 12, Simpson sent a letter to Parkland’s board calling for a review of strategic alternatives, including a “potential transition of the company to new ownership.”

“The tension between Parkland and its largest shareholder has created an overhang given elevated uncertainty, which we believe has been the key driver of recent underperformance,” Davies added on Tuesday.

On Sunday, CIBC Capital Markets analyst Kevin Chiang said Simpson’s public call for a strategic review suggests discussions between Parkland and its largest shareholder have reached an “impasse.”

Chiang maintains a $57 price target on the stock, with an “outperformer” rating.

Toronto-listed Parkland shares fell about one per cent in early afternoon trading, giving up some of the more than five per cent gain in Monday’s session. The stock has climbed nearly 35 per cent over the past 12 months.

Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.

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