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BMO upgrades Mega Brands to ‘outperform’

Canadian toy maker Mega Brands is challenging Lego’s attempts to use trademark laws in the United States to protects its mini-bricks, seen above, from competition.

ANDERS BROHUS/AP/ANDERS BROHUS/AP

Here are some of the key analyst actions on Bay Street today

Mega Brands Inc.

BMO Capital Markets analyst Gerrick L. Johnson has upgraded Mega Brands to "outperform" from "market perform" to reflect the significant progress the toy maker has made in its turnaround plan. "Recent observations at retail are encouraging," he said. "MB has secured incremental retail shelf space for the 2012 holiday season, and we believe the probability of outperforming current sales and earnings estimates has markedly improved."

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Upside: Mr. Johnson raised his price target by $3 to $11.

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Aveda Transportation and Energy Services Inc.

Small-cap, growth-oriented investors with a high risk tolerance should consider Aveda Transportation and Energy Services, said Stonecap Securities analyst Chris Blake. He initiated coverage with an "outperform" rating on the Calgary-based firm, commenting it "offers significant exposure to a number of long-term growth trends within the energy services industry."

Upside: Mr. Blake set a price target of $4.

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Orezone Gold Corp.

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Orezone Gold has reported a new resource estimate of 5.1 million ounces at the Bomboré project in Burkina Faso, up from 3.46 million ounces. Desjardins Securities analyst Brian Christie, however, lowered his net asset value estimate, as he now expects production to start one year later, in 2015, due to expected changes in development plans. "Given that Bomboré is the largest undeveloped gold asset in Burkina Faso and is likely to expand further, we maintain our buy–speculative rating," he said.

Upside: Mr. Christie cut his price target by $1 to $3.75.

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Petromanas Energy Inc.

Raymond James analyst Rafi Khouri upgraded Petromanas Energy to "outperform" from "market perform," citing the stock's recent price depreciation and working capital levels that should allow the company to comfortably fund its drilling program for the foreseeable future. "While PMI remains a higher risk exploration story, we believe that investors seeking exposure to a fully funded high impact drilling name should add shares following this recent pullback," he said.

Upside: Mr. Khouri raised his price target by a nickel to 25 cents.

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PetroDorado Energy Ltd.

PetroDorado Energy has withdrawn from the Pirity block in Paraguay because of growing uncertainty over legal and regulatory matters. This came just two months after the company agreed to sell its stake in two blocks in Peru. "Although Petrodorado's unrisked exploration upside is reduced by an estimated 70 per cent after the exclusion of its Peruvian and Paraguayan acreages, we would argue capital markets attributed negligible value to these assets," commented Raymond James analyst Rafi Khouri.

Upside: Mr. Khouri reiteratd an "outperform" rating and 30 cents price target.

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About the Author
Investment Editor

Darcy Keith is The Globe and Mail's Investment Editor. He has been a business journalist since 1992 and joined the Report on Business in 2010 from Yahoo! Canada, where he was the senior editor of finance. More

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