Analysts’ forecast returns and recommendations for all stocks in the S&P/TSX Composite Index

The ‘September Swoon’ was in full force causing pain for equity investors.

Last month, major stock markets worldwide were under pressure.

In Canada, the S&P/TSX Composite Index lost 3.7 per cent with broad-based weakness. Of the 11 sectors, only one realized a gain. The energy sector eked out a modest 0.3-per -ent price return.

In the U.S., the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite Index were down 3.5 per cent, 4.9 per cent, and 5.8 per cent, respectively. Internationally, the German DAX declined 3.5 per cent, France’s CAC fell 2.5 per cent, Japan’s Nikkei lost 2.3 per cent and Hong Kong’s Hang Seng Index suffered a 3.1 per cent loss.

However, the storm clouds may soon part as the fourth quarter has historically been positive for equity markets. The S&P/TSX Composite Index has rallied 15 of the past 20 years, the exceptions being 2018, 2015, 2014, 2008 and 2007. The largest losses were realized in 2018 and 2008, when the TSX Index declined 10.9 per cent and 22.5 per cent, respectively, while 2 per cent losses were reported in the three other down years.

Economic data along with third-quarter earnings reports and 2024 outlooks provided by management in the weeks ahead will help dictate the direction markets will be headed in the final quarter of the year.

Here’s a look at analysts’ current outlooks for Canadian stocks ahead of the third-quarter earnings parade.

This report includes a link to a list of analysts’ target prices, recommendations, forecast returns, and yields for all securities in the S&P/TSX Composite Index grouped by sector and ranked according to their expected price returns (excluding dividend and distribution income). The posted target price for each security is an average of all available target prices from analysts. A target price typically reflects an expected share or unit price 12 months from now based on an analyst’s financial modelling, such as a discounted cash flow or sum-of-the-parts model.  For the yield provided, Bloomberg calculates this figure by annualizing the most recent announced dividend or distribution value.

It’s important to note that high target prices, which imply stellar returns that seem unbelievable may be just that - unrealistic. At times, when a stock price falls analysts may maintain their bullish expectations, inflating the forecast return. In addition, an outlier (extreme target price) can skew the average target price, to the upside or downside, particularly when the number of analysts covering a stock is low. Don’t let a huge projected gain lure you into a position – it is critical to look at the company and industry fundamentals.

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