Analysts’ forecast returns, yields and recommendations for all TSX Composite stocks

Year-to-date, the S&P/TSX composite index is holding on to its gains and is now up 4.4 per cent. This has occurred despite a deceleration in revenue and earnings growth expectations.

According to Refinitiv, as of May 11, 62 per cent of companies have reported top-line results above expectations, down slightly from 64 per cent reported last quarter. Revenue growth is anticipated to increase 2.1 per cent year-over-year. However, last quarter, revenue growth was much stronger, coming in at 13 per cent.

Looking at the bottom line, 51 per cent of companies have reported better-than-expected quarterly earnings results so far, inching down from 52 per cent reported last quarter. Importantly, earnings expectations are down significantly and are expected to contract 10 per cent year-over-year, compared to earnings growth of 5.9 per cent reported last quarter.

Analysts’ revised outlooks have been mixed. Over the past month, the average target price has increased for 107 securities, representing 47 per cent of stocks in the S&P/TSX composite index. Target prices have remained unchanged for 50 stocks, while 75 have seen their average target prices fall.

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.

Click here to download an Excel version of the report.