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A dog named Roxy waits outside a Couche-Tard convenience store in Montreal, April 18, 2012.


Alimentation Couche-Tard Inc. is now poised to make headway into the European market once its its takeover of Norway's Statoil Fuel & Retail is completed next month, says TD Securities analyst Michael Van Aelst.

More than 90 per cent of the shares of Statoil Fuel & Retail have been tendered to the Quebec-based convenience store and gas-station operator. It will now proceed with compulsory acquisition of the remaining shares of company, which operates about 2,300 outlets in Scandanavia and Eastern Europe.

"We expect Couche-Tard's valuation parameters to expand over the next few years," Mr. Van Aelst told clients in a note on Thursday.

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"When it entered the United States with Johnson Oil in 2001, and followed this acquisition with numerous others, we saw its valuation spike into the mid-teens. We see the potential for this to occur again though possibly not to similar peaks as investors' comfort with Europe is believed to be less than what was the case with the U.S. a decade ago."

Mr. Van Aelst argues that consolidation within the more attractive European markets is still at its early stages, and "Couche-Tarde appears very-well positioned to meaningfully participate."

Upside: He raised his one-year target to $60 a share from $54, and maintains his "buy" rating.


Whitecap Resources Inc., an oil and gas producer, has cut its 2012 capital expenditure program by $40-to $45-million amid falling crude prices, and reduced production guidance. Whitecap is still expected to initiate a dividend, but "will probably wait until commodity prices are less volatile," said Desjardins Securities analyst Tim Murray.

Downside: He cut his one-year target to $13.25 a share from $15, but maintains his "top pick" rating.


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Canadian energy producer Niko Resources Ltd.'s 70-per-cent writedown of proved plus probable natural gas reserves at its D6 block in India "reads as very negative," said Raymond James analyst Rafi Khouri. The Street had been expecting about a 10 to 20 per cent drop, he said.

Downside: The analyst slashed his 6-12 month target to $30 a share from $52, but maintained an "outperform" rating.


Growth initiatives for retailer Canadian Tire Corp. Ltd., including introduction of a loyalty card program, should offset the headwinds of new competition in Canada from U.S. discount giant Target Corp., said TD Securities analyst Brian Morrison. Canadian Tire was able to withstand entry of Wal-Mart Stores Inc. in 1994.

Upside: He initiated coverage on the retailer with a "buy" rating, and one-year target of $80 a share.


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Housewares retailer Bed Bath & Beyond Inc. announced a weaker-than expected profit outlook for the second quarter although the guidance excludes any impact from its proposed deal to buy Cost Plus Inc. "We believe near-term potential upside is limited," said Canaccord Genuity analyst Laura Champine.

Downside: The analyst, who maintains a "hold" rating, reduced her one-year target to $71 (U.S.) a share from $73.

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