The board with the most tenure happens to be at the bank with the longest-serving CEO: Bank of Montreal, where Bill Downe has held the top role since 2007.Mark Blinch/Reuters
Inside the Market's roundup of some of today's key analyst actions
The third quarter results of financial services and retail banking company Bank of Montreal (BMO-T) had a positive impact, say Desjardins Capital Markets analyst Doug Young. "Cash EPS [earnings per share] was ahead of our estimate and consensus. The beat was driven by stronger-than-anticipated capital markets results, which we get less excited about, but there were a few other positive trends, including stronger U.S. P&C [personal and commercial] banking earnings, good expense management and a higher CET1 [common equity Tier 1 capital] ratio."
Mr. Young also says, "Overall, BMO has lower relative exposure to a slowdown in personal lending in Canada, lower retail exposure to oil-reliant provinces, the acquisition of GE's transportation finance business (which closed Dec. 1, 2015) looks like a good deal, and it is well positioned to benefit from potentially higher U.S. interest rates."
He increased his target price to $86 from $84. The consensus is $84.29, according to Thomson Reuters. His "hold" rating remains unchanged.
Canaccord Genuity analyst Gabriel Dechaine also said the bank delivered solid quarters, in both its domestic and U.S. personal and commercial segments. He raised his price target to $88 from $86.
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BMO Capital raised its price target on flash storage technology company Nimble Storage (NMBL-N) to $13 (U.S.) from $10 and kept its "outperform" rating. RBC Capital reiterated its "sector perform" rating for the stock, saying its latest earnings report showed strong results that beat expectations and it gave higher than expected guidance for the next quarter. RBC boosted its price target to $10 from $8. Summit Redstone boosted its price target on Nimble to $14 from $12 and reiterated a "buy" rating on the stock.
RBC Capital analyst Amit Daryanani said the company delivered a solid July-quarter beat and gave guidance for the October quarter revenue that was above the Street's estimates ($100-million (U.S.) to $103-million versus $100.8-million. "The EPS guide of -$0.19 to -$0.17 was slightly below Street at the midpoint most likely due to elevated investment activity," he wrote in a note. His price target of $10, up from $8, is based on "about 1.5-times enterprise value/next 12 months revenue, which is in line with IT Hardware peer group multiples."
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"Stronger demand and higher prices than anticipated" in the past few months for met coal are expected to benefit Canadian mining and energy company Teck Resources (TCK.B-T), says Raymond James analyst Alex Terentiew.
"Over the past month, spot met coal prices have been leaping higher, rising $15 (U.S.) /tonne (15 per cent), with demand from the global steel industry (mainly China) surprisingly strong after a weak start to the year. Amplifying the impact on met coal prices has been tight supply, with the slide in prices the past few years removing excess tonnes and very likely making existing producers think twice before expanding production and restarting idled capacity. Capacity cuts in China, part of the country's efforts to reduce excess, and often uneconomic and lower environmental standard capacity, are reported to be behind target, but nonetheless appear to have made an impact, removing marginal tonnes, increasing demand for imports and pushing prices higher."
Mr. Terentiew's raised his price target to $21 from $19. The consensus is $18.13. His "market perform" rating remains unchanged.
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The pending September merger of American chemical company Westlake Chemical Corp. (WLK-N) with Axiall Corp. (AXLL-N) "creates a new way to play chlor-alkali and we believe management will take full advantage of synergy potential," says RBC Capital Markets analyst Arun Viswanathan. "WLK also retains ethylene/PE exposure and is best positioned to capitalize on potentially lower for longer ethane prices. Post deal close, we anticipate the stock will continue to march higher from here."
Mr. Viswanathan's reasons for his rating upgrade to "outperform" from "sector perform" also include "strong management and financial prudence; potential IRS resolutions; we believe longer-term prospects set up nicely with a potentially 'lower for longer' ethane environment; and near-term polyethylene pricing momentum ($0.05/pound (U.S.) likely for Sept.)."
"All could provide ramps for growth in our opinion," he said.
The analyst ends his comments with, "For those who believe in lower for longer ethane, WLK is the way to play."
He increased his price target to $59 (U.S) from $47. The consensus is $55.
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Canadian-based energy exploration and production company Canacol Energy Inc. (CNE-T) has "substantial natural gas production base sold under long-term contracts that provides a stable cash flow stream to fund the growth of the company," says Mackie Research Capital analyst Bill Newman. "With the success of the Nispero 1 exploration well, CNE has added four more wells to its 2016 drilling program."
"The goal of the drilling program is to prove up 100 bcf (billion cubic feet) of new reserves that will provide the reserve base for new natural gas sales contracts and to increase total natural gas production capacity to 190 mmcf/d (million cubic feet equivalent per day) in 2017 to supply the new contracts."
The analyst's price target increased to $6.50 from $6.00. The consensus is $4.85. His "buy" rating remains unchanged.
In other analyst actions:
Deutsche Bank has cut its price target on Alibaba (BABA-N) to $109 (U.S.) from $115 but kept its "buy" rating.
KeyBanc boosted its price target on PDC Energy (PDCE-Q) to $76 (U.S.) from $72 and maintained its "overweight" rating.
Capital One upgraded Laredo Petroleum (LPI-N) to "overweight" from "equalweight" with a price target of $15 (U.S.).
UBS raised its price target on storage and data management company NetApp (NTAP-Q) TO $30 (U.S.) from $21 but maintained its "sell" rating a the shares traded higher.
Oppenheimer downgraded financial data processing systems maker Jack Henry (JKHY-Q) to "perform" from "outperform."