TransCanada's Keystone pipeline facilities in Hardisty, Alta., Friday, Nov. 6, 2015. A Donald Trump administration, combined with a Republican-controlled Senate and House of Representatives, could have reverberations that will be felt by the Canadian economy for years. THE CANADIAN PRESS/Jeff McIntoshThe Canadian Press
Inside the Market's roundup of some of today's key analyst actions
Citi Research resumed coverage of TransCanada Corp. (TRP-T) after it took "actions to simplify its corporate structure, strengthen its balance sheet and grow shareholder dividends by 8 per cent – 10 per cent through 2020."
Citi maintained its "buy" rating on the stock and its price target of $68 a share based on "higher earnings potential from the Columbia Pipeline Group (Columbia) acquisition and full ownership retention in TRP's Mexican NG pipelines."
"We think several catalysts could move TRP's share price higher in 2017E including asset sales, debt reduction, a more cooperative U.S. regulatory environment for NG projects," Citi said.
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Raymond James is raising its target price for Penn West Petroleum Ltd. (PWT-T;PWE-N) after the company released its 2017 capital budget.
"The transition continues for Penn West with the release of its 2017 capital budget, changes among its senior management team, and further details on the non-core asset dispositions. While the information in the release was broadly encouraging, with indications that PWT will reach its $100 to $200-million range in divestments early in Jan-2017, details were lacking and we will look to the year-end reserve report and 4Q16 results for more information. Nonetheless, we are sufficiently confident that the transactions will conclude to model "as if" they have. As a result, we are meaningfully lowering our 2017 production in-line with PWT's guidance. The impact on cash flow is less pronounced as we suspect that much of these assets were near cash flow neutral. Looking forward, we expect strong well results out of the Cardium in late 2016 should set Penn West up well for 2017," analysts Jeremy McCrea and Michael Shaw said in a note.
The analysts kept their "outperform" rating on the stock and boosted the target price to $3 from $2.75. The consensus target price is $2.57, according to Thomson Reuters.
Desjardins Capital Markets kept its "hold" rating on Penn West and its target price of $2.75.
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AltaCorp Capital Research has raised its price target on Bellatrix Exploration Ltd. (BXE-T) after the company said it would spend $105-million in 2017 to produce an average of 33,500 barrels of oil equivalent per day, which is 10 per cent production growth from the end of 2016 to the end of 2017.
"Overall, we are very encouraged by the acknowledgment of a sustained return to growth. On the surface, net debt is high at about $400-million (4.0 times [discounted cash flow] D/CF), however $250-million (U.S.) is termed out to 2020. Post numerous dispositions in 2016, BXE has reduced its YE2016 net debt to about $400-million and with minimal bank debt, provides enough liquidity to deliver on its three-year growth plan. We forecast BXE's YE2016 PDP [proved developed producing] reserve value (about $495-million) is nearly equivalent to its YE2016 net debt, meaning that the 2017 drilling program, across its highly-economic Spirit River acreage, will go directly to building equity value," AltaCorp said.
It kept its "outperform" rating on the stock but boosted its target to $1.75 from $1.50. The consensus is $1.44.
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BMO Capital Markets is upgrading IT research and advisory firm Gartner Inc. (IT-N) after the company announced it will buy CEB Inc. (CEB-N) in a cash and stock deal valued at about $2.6-billion (U.S.).
Gartner stock saw an 11 per cent selloff after that announcement and BMO suggested that "was a bit much."
"While we acknowledge the risks (e.g., increasing debt levels to add an underperforming asset in the largest transaction in the company's history), we believe the longer-term benefits (e.g., diversification, expanding TAM) to be positive and suggest investors take advantage of yesterday's weakness," analyst Jeffrey Silber wrote in a note.
He upgraded the stock to "outperform" from "market perform" and kept its target of $105. The consensus is $103.78.
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Needham & Co. analyst Rajvindra Gill has reiterated his "buy" rating on Nvidia (NVDA-Q) and raised his price target to $120 (U.S.) from $110 after meeting with the company's chief financial officer at the Consumer Electronics Show. He expects Nvidia can generate at least $3.10 of earnings power in fiscal year 2018 and a "bull case" scenario of $3.70 to $4.
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RBC upgraded Disney's (DIS-N) stock to an "outperform" rating from "sector perform," citing improving sentiment about the company, a number of upcoming deals with affiliates, and a rotation out of Time Warner's stock.
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Buckingham Research has downgraded Shake Shack (SHAK-N) to "neutral" from "buy" with a price target of $40.
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