10. Larry Rossy, Dollarama Inc., $265-millionThe Globe and Mail
Inside the Market's roundup of some of today's key analyst actions. This file will be updated during the trading day. For breaking analyst actions prior to market open every day, read our Before the Bell morning report.
Altacorp Capital Research analyst Jason Sawatzky initiated coverage on High Arctic Energy Services Inc. with an "outperform" rating, calling it a "deep-value stock" that has significant leverage to the build-out of liquefied natural gas assets in Papua New Guinea and Canada.
High Arctic is the leading oilfield service provider in Papua New Guinea. In Canada, it's the largest provider of snubbing services - an advanced technique to extract oil and gas from wells during the end of their productive life.
"Overall, we believe HWO is significantly undervalued as a result of the market's poor understanding of snubbing operations (i.e. viewed as dry gas-weighted and unsafe) and its overly cautious view of the company's PNG operations," Mr. Sawatzky said in a research note. "Contrary to this view, we estimate that HWO is over 80 per cent levered to oil and gas-liquids drilling in Canada. Further, the company works for numerous large cap E&P's with stringent safety requirements."
"With one of the most attractive valuations in our coverage universe and strong leverage to LNG development in both Canada and PNG, we believe HWO represents a significant opportunity for investors," he said.
He started coverage with a $4.50 (Canadian) price target.
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Canaccord Genuity analyst Robert Young boosted his price target on Redknee Solutions Inc. to $8.50 (Canadian) from $5, believing the provider of billing software will continue to benefit from its acquisition about a year ago of Nokia Siemens Networks' Business Support Systems business (NSN BSS).
"Redknee shares have appreciated meaningfully with increased confidence in the integration and quality of the NSN BSS acquisition, execution and potential for recurring revenue growth consistent with its software model," Mr. Young said in a research note.
"Redknee has seen significant momentum, evidenced by support renewals, expansions and overall demand. We continue to believe that Redknee is well positioned with bigger footprint and profile to benefit from complex billing and cloud-based BSS trends."
He reiterated a "buy" rating.
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Canaccord Genuity analyst Joe Mazumdar has taken Alpha Minerals Inc. off its focus list, downgrading the company from "speculative buy" to "hold" after 80 per cent of its shareholders voted in favour of an acquisition by Fission Uranium Corp.
He maintained his price target of $6 (Canadian).
Announced in early September, the acquisition is subject to the approval of the TSX Venture Exchange and the Alberta court, with the company expected to de-list by Dec. 6 if approved. Fission offered 5.725 shares of Fission for each Alpha share.
"The gap between the relative valuations and the bid has been difficult to close due in part to the liquidity differentials between the companies. Fission Uranium Corp.'s notional liquidity has been higher than that of Alpha Minerals Corp," he said.
Both companies would also create spin-off companies which would hold non-cash assets and obligations, with the exception of their operations in Patterson Lake South in northern Saskatchewan. Alpha Exploration Inc., Alpha Mineral's spin-off, may list as early as Dec. 9, said Mr. Mazumdar.
The average target among analysts is $9, according to Thomson Reuters.
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Transcontinental Inc. has signed an agreement with Postmedia to print the Vancouver Sun for five years, prompting CIBC World Markets analyst Robert Bek to maintain a "sector performer" rating and raise his price target to $17 (Canadian) from $16.50.
Starting in 2015, the Sun will be printed in the company's Vancouver facility, where Transcontinental will be able to take advantage of existing capacity without having to make any additional investments.
Shares have gone up more than 45 per cent over the past year, with the announcement prompting another spike this morning.
"Today's agreement was largely expected, given earlier suggestions that Postmedia would look to outsource its Vancouver printing, and with TCL long-thought of as the natural suitor, especially given the pre-existing relationship between the two sides (TCL prints the Calgary Herald)," he said.
The average target among analyst is $14.62, according to Thomson Reuters.
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In other analyst actions:
Clarus Securities cut its price target on Energold Drilling to $2.50 from $3 and maintained a "buy" rating.
Industrial Alliance Securities raised its price target on Dollarama to $90 (Canadian) from $89 and maintained a "buy" rating.
Altacorp Research raised its price target on CERF to $4.50 from $4 and maintained an "outperform" rating.
M Partners cut its price target on Trevali Mining to $1.80 from $2. It rates the stock as a "buy."
Jefferies downgraded Renren to "underperform" from "hold" and cut its price target to $2.90 (U.S.) from $3.30.
RBC Dominion Securities downgraded Points International to "sector perform" from "outperform" and raised its price target to $27 (U.S.) from $24.
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For more analyst actions, breaking investing news and analysis, follow Darcy Keith on Twitter at @eyeonequities
Darcy Keith