The Amaya Inc. headquarters are pictured on June 13, 2014, in a suburb of Montreal.Ryan Remiorz/The Canadian Press
Inside the Market's roundup of some of today's key analyst actions. This file will be updated often during the trading day so check back for new details.
Amaya Gaming Group Inc. reported fourth-quarter 2014 revenue of $368.6-million Tuesday, up 54 per cent from last year. Revenue missed Industrial Alliance Securities Inc. analyst Steve Li's estimate slightly, but with adjusted net earnings of $85.7-million, which handily beat consensus estimates of $69.4-million, the analyst upgraded the stock to "strong buy" from "buy."
"The company provided a strong outlook by highlighting growth opportunities in its business-to-consumer segment, including its market leadership due to its recent acquisition of PokerStars and Full Tilt," Mr. Li said. "Management mentioned its core Poker games should double in size in the next five years."
The analyst said Amaya's market leadership, high profitability and growth opportunities make the company a strong buy.
Mr. Li maintained his $44 price target, which represents a 48 per cent return on investment. Consensus is $44.86, according to Thomson Reuters.
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Tahoe Resources Inc.'s merger with Rio Alto Mining provides the company with "a compelling opportunity to generate significant investor returns," Raymond James analyst Chris Thompson said. The analyst upgraded the stock to "outperform" from "market perform."
Mr. Thompson said the merger will provide both geographical and product diversity. The analyst pointed to significant free cash flow generation possibilities supported by a healthy balance sheet.
"Tahoe offers investors a unique option to invest in a company run by technically trained professionals that offers fully funded production growth whilst still generating significant [free-cash flow] and adding cash to the balance sheet," Mr. Thompson said.
The analyst raised his target price to $20 (Canadian) from $19. Consensus is $18, according to Thomson Reuters.
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Teck Resources Ltd.'s shares have had an eventful week. After reports of a potential merger Monday, the company's stock surged over 10 per cent, only to fall back Tuesday when the reports were denied.
TD Securities Inc. analyst Greg Barnes maintained his "hold" on the stock while notching down his target price.
The analyst said the company's outlook on China was the "most downbeat" he has heard for some time. Teck thinks steel production in China is close to peaking at around 850-million tonnes per year.
Mr. Barnes also said that mergers or acquisitions are unlikely. While the company has made no secret about its interest in acquiring a copper asset, the analyst does not foresee a larger, "transformative-type" transaction. He pointed to the merger reported Monday with Antofagasta as "unlikely."
The analyst also said he expects the company to review the current dividend at its board meeting in April.
Mr. Barnes lowered his target price to $19 from $20. Consensus is $20.83, according to Thomson Reuters.
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Net interest income for Canadian Western Bank is a big concern for CIBC World Markets Inc. analyst Robert Sedran, given the potential impact of depressed oil prices on a prolonged weaker financial environment.
CWB relies on this income more than its larger sector peers, with over 80 per cent of revenue coming from it. Assuming loan growth may be cut in half and margins falling by five basis points, Mr. Sedran's earnings estimate for the 2016 fiscal year would fall by 12 per cent, a much steeper decline than the larger banks.
"We are not prepared to get quite this aggressive with our estimates, but do feel it is appropriate to pull them back to reflect a stubbornly more challenging top-line outlook as we look beyond the current year," he said.
As of the close on March 31, CWB shares were trading at 10.3-times Mr. Sedran's 2015 estimate and 9.7-times for 2016, representing an 8-per-cent discount to the large bank average compared with a historical premium of closer to 22 per cent.
The analyst is maintaining his "sector performer" rating, but he is lowering his price target to $31 from $32. The consensus is $31.17.
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Increased oxide and sulfide reserves at Alacer Gold Corp.'s Copler mine in Turkey has caused RBC Capital Markets analyst Dan Rollins to raise his near- and long-term cash flow forecasts.
Additional oxide reserves are expected to extend the life of Alacer's heap leach operation, providing greater capital flexibility while the company's sulfide project is ramped up. The economics of that project were enhanced by an additional 4.5 years of reserves and optimized grade profile, according to Mr. Rollins. An expected incremental rise in production should provide a positive impact on cash flow.
After revised operational projections, the analyst now forecasts an average cash flow per share of 24 cents through 2019, an increase of 13 per cent from a previous estimate of 22 cents.
He maintained his "sector perform" rating, but he raised his price target to $3.50 from $3.25. Consensus is $2.84.
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In other analyst actions:
Ithaca Energy Inc. was upgraded to "buy" from "hold" at Mackie.
Empire Co. Ltd. was upgraded to "outperform" from "sector perform" by National Bank Financial.
Domtar Corp. was lowered to "neutral" from "buy" at D.A. Davidson.
American Airlines Group Inc. was downgraded to "hold" from "buy" at Deutsche Bank.
Twitter Inc. was initiated with a "buy" rating and price target of $65 (U.S.) by Jefferies.
Carmanah Technologies Corp. was raised to "top pick" from "buy" at Cormark Securities. The 12-month target price is $8 (Canadian) per share.
Crius Energy Trust was rated new "buy" at Mackie Research Capital. The 12-month target price is $8.30 (Canadian) per share.
Enterprise Group Inc. was downgraded to "hold" from "buy" at Mackie Research Capital. The 12-month target price is 30 cents (Canadian) per share.
ENTREC Corp. was raised to "buy" from "sell" at Dundee Securities. The 12-month target price is 90 cents (Canadian) per share.
With files from Bloomberg News
David Leeder