It's time for investors to take profits on their holdings in Teck Resources Ltd. , urges National Bank Financial technical analyst Dennis Mark.
Teck has been battling resistance at $44. It touched that level during intraday trading on Jan. 26. But since then, a number of re-tests failed to propel shares any further. Meanwhile, several short-term momentum indicators have already turned down, according to Mr. Mark.
"The close back below its 200-day moving average although marginal is a further technical negative," he added.
Downside: Mr. Mark expects initial support at $37 will be challenged.
Canfor Pulp Products Inc. cut its quarterly dividend by 38 per cent to 25 cents, prompting a downgrade by RBC Dominion Securities Inc. analyst Paul C. Quinn. "While we are not forecasting a further dividend cut, the current weakness and opacity in global pulp markets leads us to our cautious approach. We believe that investors should be similarly positioned," he said.
Downside: Mr. Quinn lowered his rating to "underperform" from "sector perform," and cut his price target by $2 to $11.
WestJet Airlines Ltd. is “returning value to shareholders,” declared UBS analyst Hilda Maraachlian after the company beat fourth-quarter earnings estimates as it announced a share repurchase plan and quarterly dividend hike.
WestJet plans to buy back up to 5 per cent of its outstanding shares and has increased its quarterly dividend by 20 per cent to six cents a share. It also announced that its employees have voted 91 per cent in favour of launching a regional short haul airline, which will fly as early as 2013 to smaller Canadian destinations using a fleet of 40 turboprops.
The airline reported fourth-quarter earnings per share of 26 cents, thanks mainly to slightly higher revenues of $781-million and lower costs. Westjet finished the quarter with $1.3-billion of cash.
Upside: Ms. Maraachlian is maintaining her “buy” rating and $15.50 (Canadian) price target.
Read more: WestJet workers back regional subsidiary
Related: Shares of Canada's airlines poised for takeoff: RBC
CIBC World Markets Inc. analyst Jeff Fetterly is downgrading Flint Energy Services Ltd. due to its rising stock valuation.
“Since announcing strong third-quarter 2011 results on Nov. 6, Flint’s shares have outperformed its peers, rising by 23 per cent compared to a modest decline for our coverage group,” explains Mr. Fetterly.
While he expects the company to announce additional oil sands work in coming months and implement a dividend, Mr. Fetterly believes the company’s valuation is increasingly reflective of these positive catalysts.
Downside: He nudged up his price target by $1 to $19 but lowered his rating to “sector performer” from “sector outperformer”.
Agrium Inc. reported positive fourth-quarter 2011 earnings despite sagging global potash prices, and Desjardins Securities Inc. analyst John Hughes believes its shares will trade higher in the short term.
Agrium’s sales of nitrogen-based fertilizers were up 30 per cent quarter-over-quarter and 8 per cent year-over-year, while sales of phosphate-based products were up 16 per cent year-over-year and 3 per cent quarter-over-quarter. Potash, however, experienced a 5 per cent year-over-year decline in sales volumes, although sales increased 15 per cent quarter-over-quarter.
Agrium did not provide an outlook for its expected financial results in 2012.
Upside: Mr. Hughes is maintaining his “buy--average risk” rating and $106.30 (Canadian) target price.
Read more: Agrium profit climbs 43%
Nevsun Resources Ltd. released 2012 gold production guidance of 190,000 to 210,000 ounces - about half of previous expectations - due to a lowering of estimated oxide reserves at its Bisha Main deposit in east Africa. CIBC World Markets analyst Cosmos Chiu downgraded the stock to “sector underperformer” as a result of continuing uncertainty over the reserve calculation. “Although issues in calculating the oxide reserve do not appear to extend to the supergene and primary zones, further studies need to be conducted,” he said.
Downside: Mr. Chiu cut his price target by $2.50 to $5.50.
Read more: Nevsun shares plummet on news of lower output