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Pembina's Valleyview truck and tank station, south of Valleyview, Alberta.

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.

Following the recent signing of letters of intent to purchase two U.S.-based treated-wood companies, Desjardins Securities analyst Benoit Poirier upgraded his rating for Stella-Jones Inc. (SJ-T).

Citing strong industry fundamentals, contributions from the acquisitions of Texas-based Lufkin Creosoting and Louisiana-based Kistachie, as well as a recent decline in share price, Mr. Poirier moved his rating to "buy" from "hold."

Estimating the total price paid for the two companies, through subsidiary McFarland Cascade, is $104-million, he said the earnings per share accretion is 15 cents. He added it will likely to contribute $120-million per year in revenues and to grow by approximately 4 per cent annually. It will also strengthen the company's presence in the utility pole business.

"Our numbers do not assume any equity issuance at this point, although we would expect SJ to end the fourth quarter 2015 with a debt/EBITDA ratio of 2.6-times, and end the second quarter of 2016 at 3.0-times (following the closing of the transactions), respectively," the analyst said. "We view these levels as manageable, although management typically targets a ratio of [approximately] 2.5-times. As a result, it is fair to expect an equity issue at some point, as management has been vocal about this possibility. However, we would expect such a deal to be well received by investors as equity offerings completed to date have generally been positively received by the market given the challenge to build a sizeable position for some institutional investors and given SJ's successful management team that has proven to be a strong consolidator."

Mr. Poirier said he expects Stella-Jones to continue to trade at "rich multiples," with a premium valuation reflecting investors' confidence that it will capitalize on growth opportunities while maintaining profitability.

"Stella-Jones's valuation has continued to trend higher in recent years, driving multiples well above historical levels and to a significant premium to publicly traded peers," he said. "In our view, this premium valuation is predicated on, among other factors, Stella-Jones's (1) strong position in the railway tie and utility pole markets, where projected organic growth remains favourable and is supported by stable replacement demand, (2) track record for accretive growth through M&A, where opportunities (although smaller) remain in its core end markets, and (3) ability to generate healthy free cash flow and a consistent EBITDA margin."

Mr. Poirier raised his price target for the stock to $51 from $48. The analyst consensus price target is $53.21, according to Thomson Reuters.

"Based on the recent pullback in the share price (SJ's stock is down 18 per cent from its 52-week high) and its latest acquisitions, which should fuel growth, we see the stock as being more attractive as the new target price offers a potential return of 16 per cent while offering robust defensive characteristics (regular maintenance represents approximately 90 per cent of sales for railway ties and utility poles); at the same time, industry fundamentals remain strong," he said. "Further, at the right price, we would expect an upcoming equity offering to be well received by investors as it would provide more liquidity in the name."

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Canaccord Genuity analyst David Galison said he does not see "meaningful" catalysts for "significant and sustained" improvement in the price of oil over the next 12 months.

In a fourth-quarter 2015 earnings preview for midstream pipeline companies, Mr. Galison said he believes valuations will remain at "current depressed levels." He downgraded Veresen Inc. (VSN-T) and Inter Pipeline Ltd. (IPL-T) to "hold" from "buy" due to reductions in his price targets.

"Historically, the share price for the Midstream group has had limited correlation to the price of oil (long-term average of approximately 0.27); the recent significant volatility in oil prices are having a more pronounced impact. Since June 1, the share price correlation has averaged 0.84," he said.

Mr. Galison's target changes were:

- Veresen to $8 from $12. Consensus is $13.44.

- Inter Pipeline to $23 from $28.50. Consensus is $27.05.

- Pembina Pipeline Corp. (PPL-T, buy) to $36 from $43. Consensus is $40.67.

- Keyera Corp. (KEY-T, buy) to $42 from $46. Consensus is $45.73.

- Altagas Ltd. (ALA-T, buy) to $34 from $38. Consensus is $36.06.

- Gibson Energy Inc. (GEI-T, buy) to $19 from $20. Consensus is $18.71.

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Shares of Kinross Gold Inc. (KGC-N, K-T) are trading at a "meaningful discount" to its peers, according to BMO Nesbitt Burns analyst Andrew Kaip.

Even after a rise of almost 25 per cent over Thursday and Friday of last week, Mr. Kaip upgraded his rating for the stock to "outperform" from "market perform."

The analyst called Kinross "an operator with a solid track record of execution" and sees it representing "a relatively lower-risk company, with potential upside in Nevada as a positive catalyst on the horizon."

"KGC has met or exceeded initial production guidance every year since 2010, and is forecast to meet guidance again heading into reporting on Feb. 10, based on our estimates," said Mr. Kaip. "As a respected and consistent operator with a long track record of execution, we believe KGC is well positioned as a relatively lower-risk company among the peer group."

He added: "Kinross is currently undergoing a scoping study for an expansion scenario at Round Mountain, after acquiring the asset along with Bald Mountain from [Barrick Gold] late last year. In our view, the expansion is now likely to appear more attractive to investors at the current gold price of approximately $1,170 per ounce (versus $1,085/oz at the time of the acquisition), and delivery of the study represents a potentially positive catalyst."

Mr. Kaip raised his target price for the stock to $2.75 (U.S.) from $2. Consensus is $2.97.

"KGC is trading well below the peer group on 2016 estimate price to cash flow (3.6-times versus peers at 11.4-times) and price to net asset value (1.2-times versus peers at 1.8-times), and we see potential for a re-rating of KGC shares towards historical P/CF and P/NAV averages," he said.

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BMO Nesbitt Burns analyst Andrew Kaip raised his target price for Newmont Mining Corp. (NEM-N) following a tour of the company's Akyem mine in Ghana.

Mr. Kaip forecasts the open-pit mine will produce 463,000 ounces of gold in 2015 with all-in sustaining costs (AISC) of $590 (U.S.) per ounce. That result would be in line with guidance of 450-480,000 at an AISC of $590-$630 per ounce.

"NEM highlighted its efforts to balance out power unreliability in Ghana with the installation of an additional 23 mega watts of permanent backup generating capacity," the analyst said. "The additional backup power (further to 9MW of already-installed capacity) should enable the company to comfortably address future load shedding. The mine is currently processing a blend of saprolite and primary ore (approximately 15 per cent/85 per cent), and NEM anticipates a minor decline in recoveries and throughput as the mine transitions towards 100 per cent primary ore. Grades are also expected to decline as the mine trends towards reserve grade, and NEM's guidance outlines an increase in 2016 AISC of approximately 19 per cent as a result.

"Despite the lower grades, Akyem remains positioned as one of the lower-cost and higher-grade gold operations in the NEM portfolio. The company also highlighted its continuous improvement initiatives (termed Full Potential Projects) that have yielded impressive results in Africa. At Ahafo, AISC have declined 7 per cent since 2012 despite a 30-per-cent decline in grade. Ahafo offers an appealing platform for growth in the region as the company continues to evaluate a potential mill expansion and underground mine at Subika. Construction decisions on both projects are expected in H2/2016."

Maintaining his "outperform" rating, he raised his target to $27.50 (U.S.) from $23.50. Consensus is $23.11.

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After first-quarter 2016 earnings "easily" beat expectations, BMO Nesbitt Burns analyst Kenneth Zaslow called Tyson Foods Inc. (TSN-N) a "compelling investment opportunity."

The U.S. food production company recorded earnings per share of $1.15 (U.S.), compared to an 89-cent expectation from the Street. It raised its full-year profit forecast to $3.85-$3.95 per share from $3.50-$3.65.

Calling that guidance "conservative" given strength in its pork margins, recovering beef margins and stability in chicken margins, Mr. Zaslow said: "TSN may exceed the $4.00 EPS mark as early as 2016, as it 1) continues to decommoditize its chicken operation; 2) finally benefits from an ample supply of hogs; 3) begins to enjoy the cyclical rebound in beef; 4) heightens its focus on prepared foods (including increased synergy capture); and 5) prudently deploys capital."

Keeping his "outperform" rating, Mr. Zaslow raised his target to $62 from $53. The analyst average, according to Bloomberg, is $63.80.

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In other analyst actions:

AutoCanada Inc. (ACQ-T) was raised to "outperform" from "sector perform" at Alta Corp. Capital by equity analyst Chris Murray. The 12-month target price is $26 (Canadian) per share.

Antero Midstream Partners LP (AM-N) was downgraded to "neutral" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $23 (U.S.) per share.

Chesswood Group Ltd. (CHW-T) was raised to "buy" from "market perform" at Cormark Securities by equity analyst Jeff Fenwick. The 12-month target price is $14 (Canadian) per share.

Cisco Systems Inc. (CSCO-Q) was raised to "neutral" from "underperform" at Macquarie by equity analyst Rajesh Ghai. The 12-month target price is $26 (U.S.) per share.

DexCom Inc. (DXCM-Q) was downgraded to "neutral" from "outperform" at Robert Baird by equity analyst Jeffrey Johnson. The 12-month target price is $74 (U.S.) per share.

EnLink Midstream LLC (ENLC-N) was downgraded to "underperform" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $10 (U.S.) per share.

EPAM Systems Inc. (EPAM-N) was raised to "buy" from "neutral" at Monness Crespi by equity analyst Alexander Veytsman. The target price is $72 (U.S.) per share.

Eversource Energy (ES-N) was downgraded to "equal-weight" from "overweight" at Barclays by equity analyst Daniel Ford. The target price is $58 (U.S.) per share. It was downgraded to "neutral" from "outperform" at Macquarie by equity analyst Andrew Weisel with a target price of $55 per share.

Essex Property Trust Inc. (ESS-N) was raised to "buy" from "neutral" at Mizuho Securities USA by equity analyst Richard Anderson. The target price is $234 (U.S.) per share.

Energy Transfer Equity LP (ETE-N) was downgraded to "neutral" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $7 (U.S.) per share.

Energy Transfer Partners LP (ETP-N) was downgraded to "neutral" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $25 (U.S.) per share.

L Brands Inc. (LB-N) was raised to "buy" from "hold" at Brean Capital by equity analyst Liz Pierce. The 12-month target price is $100 (U.S.) per share.

Marvell Technology Group Ltd. (MRVL-Q) was raised to "buy" from "sell" at B. Riley by equity analyst Craig Ellis. The 12-month target price is $12 (U.S.) per share.

ONEOK Inc. (OKE-N) was downgraded to "neutral" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $24 (U.S.) per share.

ONEOK Partners LP (OKS-N) was downgraded to "underperform" from "neutral" at Robert Baird by equity analyst Ethan Bellamy. The target price is $24 (U.S.) per share.

Plains All American Pipeline LP (PAA-N) was downgraded to "underperform" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $16 (U.S.) per share.

Plains GP Holdings LP (PAGP-N) was downgraded to "underperform" from "neutral" at Robert Baird by equity analyst Ethan Bellamy. The target price is $6 (U.S.) per share.

Ralph Lauren Corp. (RL-N) was downgraded to "neutral" from "overweight" at Atlantic Equities by equity analyst Daniela Nedialkova. The 12-month target price is $95 (U.S.) per share.

Tallgrass Energy GP LP (TEGP-N) was downgraded to "neutral" from "outperform" at Robert Baird by equity analyst Ethan Bellamy. The target price is $16 (U.S.) per share.

With files from Bloomberg News

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