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Inside the Market’s roundup of some of today’s key analyst actions

Characterizing BCE Inc.’s (BCE-T) second-quarter results as “a solid underlying beat,” Canaccord Genuity analyst Aravinda Galappatthige upgraded his rating for its shares on Friday based on a “strengthening overall thesis.”

“A notable positive was the stronger than expected wireless service revenue growth which nearly reached pre-pandemic (Q2/19 levels), reflecting a faster recovery,” he said in a research note

Mr. Galappatthige raised his financial expectations for the Montreal-based telecom for the second half of 2021 and fiscal 2022 almost entirely based on the wireless performance, and sees its ability to reach pre-pandemic levels for service revenue in the second quarter, versus his fourth-quarter prediction, as “meaningful.”

“In a sense, we were more encouraged by the fact that the positive variance was more on the pricing front (ARPU/ABPU), as we believe volumes would strengthen in any case in H2 across the sector,” the analyst said. “Importantly, we note that when we adjust for the pandemic-driven roaming shortfall, wireless service revenues are actually up an estimated 2.8 per cent vs Q2/19 (i.e., pre-pandemic). With promotional intensity still relatively under check and further cost-containment options for the incumbents including lower COA, this could translate to stronger EBITDA growth in wireless.”

Also seeing an “improving wireline picture helping recast BCE’s thesis,” Mr. Galappatthige now sees a “relatively better balance sheet position versus [the] sector.

“While BCE’s leverage is by no means low at 2.9 times (and 3.1 times post spectrum spend), against the backdrop of likely elevated caution around Telecom balance sheets post the spectrum auction and the impending Shaw acquisition (RCI, TELUS, QBR), we argue that BCE’s looks more reasonable. In fact, our projections indicate BCE’s leverage eases to 3 times by end of F2022. We believe this can serve to further shift investor interest towards BCE,” he said.

Moving his recommendation to “buy” from “hold” Mr. Galappatthige raised his target to $66 from $62. The average on the Street is $61.71, according to Refinitiv data.

“In light of the stronger wireless numbers, strengthening residential wireline outlook and a concerted push around digital and ad-tech to drive Media, we have upped our target multiples for all three segments (wireless from 8.75 times to 9.25 times, wireline 7.75 times to 8.25 times and Media from 6.5 times to 7 times),” he said. “Our target thus rises $4 to $66 per share. With that, we are upgrading the stock to a BUY (from Hold). We believe our rating is also supported at a macros level by the easing rate environment given BCE’s bond proxy status and general market leaning back toward a defensive posture.”

Other analysts making target changes include:

* RBC Dominion Securities’ Drew McReynolds to to $63 from $61 with a “sector perform” rating.

“We continue to believe BCE’s competitive position relative to peers could see the greatest gains over the medium term driven by FTTH expansion and 5G deployment across Canada’s largest integrated wireline-wireless network footprint, and given growth in 5G B2B,” said Mr. McReynolds. “We believe the migration to unlimited plans/EIPs, residential Internet market share gains driven by sustained FTTH investment, a gradual improvement at Bell Media alongside digital initiatives, and the realization of additional cost efficiencies that leverage a scale advantage position BCE for continued dividend growth, albeit with an elevated but declining dividend payout ratio beginning in earnest in 2023.”

* Desjardins Securities’ Jerome Dubreuil to $64 from $61.50 with a “hold” rating.

“While we believe BCE will remain a core holding for many funds, we believe it is too early to put an overweight tag on the stock. We support the company’s strategy to accelerate its wireline network deployments, but its weaker medium-term FCF outlook (vs the past few years) and lack of near-term catalysts keep us on the sidelines at this point,” he said.

* CIBC’s Robert Bek to $64 from $61 with a “neutral” rating.

“Q2 results were close to Street estimates, excluding a regulatory one-timer, with Wireless results that were excellent, despite ongoing COVID headwinds,” said Mr. Bek. “We are currently at Neutral on BCE, solely as a valuation call on the space. The shares have finally recovered value in these markets, reflecting the company’s consistency, defensive qualities, outstanding dividend yield of 6 per cent and overall stable financial profile.”

* Scotia Capital’s Jeff Fan to $66 from $63 with an “outperform” rating.

* TD Securities’ Vince Valentini to $67 from $66 with a “buy” rating

* JP Morgan’s Sebastiano Petti to $66 from $60 with a “neutral” rating.

* National Bank Financial’s Adam Shine to $66 from $64 with an “outperform” rating.


Canaccord Genuity analyst Aravinda Galappatthige continues to see the outlook for Thomson Reuters Corp. (TRI-N, TRI-T) as “solid.”

However, a day after its shares jumped 5.6 per cent in the wake of the premarket release of better-than-anticipated second-quarter results, he lowered his rating for its shares to “hold” from “buy,” citing valuation concerns.

“While the 2021 guidance uptick was not entirely surprising, given the strong start in Q1 and outlook comments made by management then; when we consider the strength of the Q2 results and qualitative comments made by management with respect to longer-term drivers, the prospect of even a beat to the long-term guideposts (4-6-per-cent revenue growth in F2022/23, EBITDA margin expansion to 38-40 per cent) starts to look realistic,” he said. “While there is still significant work to be done to achieve this, importantly, the macro/industry conditions appear very favourable. Outperformance of the 2022/23 targets would be quite meaningful for TRI as the underlying projections were calling for a 10-per-cent CAGR [compound annual growth rate] on adjusted EBITDA through 2020-2023.”

Mr. Galappatthige thinks Thomson Reuters’ “Big 3” segments (Legal Professionals, Corporates, Tax & Accounting) appear on track to achieve mid-to-high single-digit growth following fiscal 2021, but he thinks the company is now “efficiently valued in current market backdrop.”

“TRI’s share price has strengthened a further 17 per cent over the past three months and 37 per cent year-to-date, reflective of the strong medium-to-longer term outlook for the business and demonstrated (during COVID-19) defensive traits,” he said. “However, clearly there has been a substantial macro element to the upswing as well, evident in TRI’s two closest comps – Wolters Kluwer rising 39 per cent year-to-date and RELX up 23 per cent year-to-date. The stock now trades at a historically high 20.7 times (2022 estimated) EV/EBITDA, a notable premium to RELX’s 16 times and Wolters at 17.6 times. While TRI’s underlying 10-per-cent EBITDA growth profile, combined with its solid balance sheet and proven defensive qualities may support this premium, the case for further multiple expansion is mixed. TRI’s headline metrics are somewhat ahead of Wolters, e.g 200bps in terms of revenue growth (greater on EBITDA growth), and more balance sheet capacity, etc. On the other hand, it can be argued that the 3-times-plus premium adequately addresses that. On the flipside, broader comps such as FactSet (FDS-US) which trades at 23.8 times EV/EBITDA 2022 with a generally similar growth trajectory, can set the stage for a case for an even higher multiple.”

With a “view to picking more attractive entry points in the future,” Mr. Galappatthige raised his target to US$108 from US$102. The average on the Street is US$108.62.

Conversely, National Bank Financial’s Adam Shine cut Thomson Reuters to “sector perform” from “outperform” with a $145 target, up from $139.

Others making target changes include:

* RBC Dominion Securities’ Drew McReynolds to US$118 from US$112 with an “outperform” rating.

“Better than forecast Q2/21 results and another upward revision to the 2021 outlook are indicative of underlying structural and cyclical momentum across the business, which we believe continues to build,” Mr. McReynolds said. “Given this momentum, management’s high degree (and growing) confidence in achieving 2023 targets and proven earnings resilience, visibility in our view has substantially improved over the past six months

* Scotia Capital’s Paul Steep to US$112 from US$100 with a “sector perform” rating.

“Our thesis on TRI remains that the firm is working to reposition itself as a higher-growth software business in its core markets, supported by a substantial content engine. We believe that many of the initiatives implemented by TRI during its transformation are set to take hold over the next several years as it seeks to deliver stronger organic revenue and FCF per share growth,” said Mr. Steep.

* BoA Securities’ Gary Bisbee to US$125 from US$111 with a “buy” rating.

“TRI is a quality defensive compounder with a good operational improvement story through its 2-year ‘Change Program’. We see good appreciation potential as the company executes, revenue accelerates, earnings and cash flow ramp sharply in 2022- 23, and it begins to put its strong balance sheet to work,” he said.

* CIBC World Markets’ Robert Bek to US$115 from US$102 with a “neutral” rating.

“We are encouraged by the customer demand for TRI services reflected in Q2/21 results and management’s outlook. We are increasingly optimistic on the potential for FY23 and beyond, following the company’s change plan. We have increased our FY22 EBITDA estimates on the change plan’s progress, and on continued revenue momentum across the company’s key segments. Our Neutral rating on the stock stems from our view on valuation gain potential at these lofty levels,” said Mr. Bek.

* Credit Suisse’s Kevin McVeigh to US$135 from US$120 with an “outperform” rating.

* TD Securities’ Vince Valentini to $155 from $135 with a “buy” rating.

* Morgan Stanley’s Toni Kaplan to US$105 from US$96 with an “equal-weight” rating.

* JP Morgan’s Andrew Steinerman to US$115 from US$99 with a “neutral” rating.


A day after its shares jumped over 7 per cent to an all-time high in the wake of stronger-than-anticipated quarter results, the Street praised Lightspeed POS Inc. (LSPD-T).

The Montreal commerce-software provider reported net revenues for its second quarter of US$116-million, up 220 per cent year-over-year and exceeding the consensus forecast among analysts of US$93-million. An EBITDA loss of US$6-million also beat expectations (a $10-million loss) with gross transaction volume jumping 203 per cent.

“LSPD served up a trifecta this quarter driven by a strong rebound/ reopening in its merchant base, increased payments monetization, and strong merchant growth. Increasing estimates and price target,” said analyst Paul Treiber of RBC Dominion Securities.

In response to the company’s increased guidance, Mr. Treiber raised his financial expectations, pointing to “strong monetization trends in payments, and platform integration well on its way.”

That led him to hike his target for Lightspeed shares to US$114 from US$98 and reiterating his “outperform” recommendation. The average target is $129.48.

Others making target changes include:

* Scotia Capital’s Paul Steep to US$108 from US$93 with a “sector perform” rating.

“Our view remains that Lightspeed is a strong organic revenue growth name with potential to benefit from a number of organic vectors (e.g., cloud conversion of onpremise POS market, introduction of Lightspeed Payments into new markets), with the potential to continue actively consolidating the POS market and adding on new technologies,” said Mr. Steep.

* ATB Capital Markets’ Martin Toner to $200 from $150 with an “outperform” rating.

* CIBC’s Todd Coupland to $155 from $145 with an “outperformer” rating.

* National Bank Financial’s Richard Tse to US$120 from US$110 with an “outperform” rating.

* BTIG’s Mark Palmer to $140 from $115 with a “buy” rating.

* Credit Suisse’s Timothy Chiodo to US$115 from US$92 with an “outperform” rating.

* Barclays’ Raimo Lenschow to US$118 from US$92 with an “overweight” rating.

* JP Morgan’s Tien-Tsin Huang to $122 from $91 with a “neutral” rating.


With its “Back to Basics” strategy delivering “impressive” results and seeing a sales recovery underway, Canaccord Genuity analyst Luke Hannan upgraded Gildan Activewear Inc. (GIL-N, GIL-T) to “buy” from “hold.”

Before the bell on Thursday, the Montreal-based clothing reported revenue for the second quarter of US$747-million, exceeding both Mr. Hannan’s US$710-million estimate and the consensus projection of US$697-million. Adjusted earnings per share of 68 US cents also blew past expectations (53 US cents and 51 US cents, respectively).

“Notably, Gildan’s Back to Basics strategy has continued to pay dividends, with adjusted gross margin of 30.5 per cent representing an expansion of 270 basis points relative to 2019,” the analyst said. The company has also been able to scale its business back up efficiently, with SG&A as a percentage of sales coming in at 10.7 per cent for the quarter, or 80 bps better than Q2/19.

“Despite an uncertain outlook, with (1) labour shortages, (2) reduced supply of raw materials/higher transportation costs ‚and (3) the Delta variant creating more questions than answers on expected demand, Gildan expects to achieve its 18-per-cent adjusted operating margin target for 2021, which is well above our and consensus’ 16.6-per-cent expectation.”

Raising his full-year revenue and earnings projections, Mr. Hannan also hiked his target for Gildan shares to US$42.50 from US$38. The current average is US$41.85.

“Given the combination of (1) strong results despite demand that remains below pre-pandemic levels (21-per-cent adj. EPS growth despite revenue falling 7 per cent vs. Q2/19); (2) flexibility to implement price increases to maintain its 18-per-cent margin target for 2021/ early 2022 in the face of an inflationary cost environment; and (3) robust free cash flow generation leading to 0.6 times net debt/TTM EBITDA (well below Gildan’s 1-2 times comfort level) and the resumption of its share buyback program, the risk-reward profile for Gildan shares becomes significantly more compelling for investors, in our view, particularly with the stock trading at 15.3 times our NTM EPS estimate. As a result, we are upgrading our rating,” he said.

Meanwhile, TD Securities analyst Brian Morrison raised the stock to “action list buy” from “buy” with a US$48 target, up from US$42.

Others making target changes include:

* Scotia Capital’s Patricia Baker to US$44 from US$42 with a “sector outperform” rating.

“All in, Q2 was a very solid quarter for GIL and reflects solid execution underscoring the importance of the company’s ‘Back to Basics’ strategy,” she said.

* CIBC’s Mark Petrie to US$43 from US$41 with an “outperformer” rating.

“Blowout Q2 results lead to increased confidence in the revenue recovery and profit potential at Gildan. We have increased our estimates to reflect the achievement of 18-per-cent EBIT margins in 2021 and expect this to be a sustainable level going forward, with room to drive revenue growth over time. Capacity and supply chain constraints are issues but should be solved in time. Meantime, cash flow is robust and supports a return of cash to shareholders,” he said.

* National Bank Financial’s Vishal Shreedhar to $56 from $53 with an “outperform” rating.


With shares of Equinox Gold Corp. (EQX-T) now trading at half of his revised net asset value calculations, Desjardins Securities analyst John Sclodnick raised his rating for its shares to “buy” from “hold.”

On Thursday, the Vancouver-based company fell 5.8 per cent following the release of “disappointing” quarterly results and a reduction to its guidance.

“Since our downgrade to Hold on the back of the blockade announcement at Los Filos, the stock has underperformed the S&P/TSX Global Gold Index by 25 per cent and is now trading at the lows seen in March 2020,” he said.

“While we still see risk with the number of capital projects ahead, we believe this is fully priced in. The weak 1H is behind it and we expect to see improved costs and production in the back half of the year, with the company resuming operations at Los Filos and accessing the higher-grade deposits, higher grades expected at Mesquite after stripping the Brownie pit and the challenging rainy season in Brazil now in the rearview. Overall, we remain concerned about capex overruns at Greenstone, permitting timelines at Castle Mountain Phase 2 and risk of another blockade and operation disruption at Los Filos; that said, we believe that the market is adequately pricing in this risk, and we see limited downside from the current level and view it as an attractive entry point.”

With a “more positive” view of the second half of the year, Mr. Sclodnick maintained a $12.75 target for Equinox shares. The average is $16.44.

Elsewhere, National Bank Financial’s Michael Parkin cut his target to $15 from $17 with an “outperform” rating.


Though he continues to expects its Vascepa cardiovascular treatment to be a “Canadian blockbuster,” Raymond James analyst Rahul Sarugaser downgraded HLS Therapeutics Inc. (HLS-T) to “market perform” from “outperform” based on short-term headwinds on its commercialization.

“After HLS’s 1Q21 earnings in May, which revealed slowed Vascepa prescription rates due to COVID-19 limiting physician visits, management guided its Vascepa quarterly prescription expectations downward — pushing timelines out by 1.5 months — and we, accordingly, revised our revenue estimates downward,” he said. “While management now no longer provides forward prescription guidance — COVID has made forecasting early-stage drug sales too challenging; 2Q21 prescriptions fell just short of 1Q21 guidance — we view Vascepa’s sales ramp as a ‘not if, but when’ story.”

Following in-line second-quarter results, Mr. Sarugaser cut his target to $24 from $28. The average is $30.88.


In other analyst actions:

* RBC Dominion Securities analyst Greg Pardy raised his Canadian Natural Resources Ltd. (CNQ-T) target to $55 from $53, exceeding the $53.67 average on the Street, with an “outperform” rating. Others making target changes include: JP Morgan’s to $59 from $56 with an “outperform” rating and TD Securities’ Menno Hulshof to $55 from $52 with a “buy” rating.

“CNQ is poised to accelerate its share buyback program as its $15 billion debt target draws near in the fourth-quarter—and is firing on all cylinders operationally and financially,” said Mr. Pardy. “We are reaffirming an Outperform recommendation on CNQ and raising our one-year price target by 4 per cent to $55 per share amid higher 2022 estimates. CNQ is on both our Global Top 30 and Best Energy Ideas lists.”

* RBC’s Sabahat Khan raised his Premium Brands Holdings Corp. (PBH-T) to $123 from $107 with a “sector perform” rating, while Desjardins Securities’ David Newman raised his target to $140 from $135 with a “buy” rating and iA Capital Markets’ Neil Linsdell moved his target to $140 from $132 with a “buy” recommendation. The average is $133.45.

“The Company demonstrated impressive growth in Q2, with value-added products such as artisan sandwiches, meat and charcuterie delivering excellent results,” said Mr. Linsdell. “While commodity price inputs continue to cause volatility and temporary margin pressures ,its dynamic pricing model, product innovation, and scale, combined with a robustacquisition pipeline leave the Company well equipped to achieve its 2023 goals of $6-billion in revenue and $600-million in EBITDA.”

* Raymond James analyst Bryan Fast cut his target for Ritchie Bros Auctioneers (RBA-N, RBA-T) to US$63 from US$65 with a “market perform” rating. The average is US$63.50.

“As we have seen through 1H21 and supported by recent Equipment Dealer results, the demand for both new and used equipment in North America has shown strength,” he said. “Although OEM’s continue to ramp up production following a lull during the early months of the pandemic, inventories remain low. Coupled with strong sales, equipment supply is tight. Although demand for equipment is clear, Ritchie’s business model needs willing consignors and supply to match that demand. We expect those supply concerns to persist in the near term. Longer term, the opportunity is significant for Ritchie Bros, as the company targets the $300-billion used heavy equipment global market. We expect the company to flush out their strategy in a post pandemic world and maintain a focus on their multi-channel platform. Despite this, we expect that much of the near-term upside is implied in the current valuation.”

* RBC’s Irene Nattel raised her Maple Leaf Foods Inc. (MFI-T) target to $38 from $36 with an “outperform” rating, while CIBC’s Mark Petrie increased his target to $38 from $37 with an “outperformer” recommendation and Scotia’s George Doumet moved his target to $36 from $35.50 with a “sector perform” rating. The average is $36.07.

“Although tepid as expected, performance of Meat Protein in Q2 reaffirms our constructive view and the trajectory toward the 14-16-per-cent EBITDA target, although our timeline is a touch more conservative than management’s 2022 goalpost. While we anticipate ongoing EBITDA drag from Plant Protein in H2 roughly in-line with prior year due to investments in innovation, capacity and brand positioning, positive traction on the top line could go a long way in reversing investor sentiment, in our view,” said Ms. Nattel.

* RBC’s Paul Treiber raised his Information Services Corp. (ISV-T) target to $32 from $27 with a “sector perform” rating, while CIBC’s Stephanie Price increased her target to $35.50 from $33, topping the $33.65 average, with an “outperformer” rating and Raymond James’ Stephen Boland bumped up his target to $37 from $31 with an “outperform” recommendation.

“With robust activity in the Saskatchewan real estate market and strong organic growth in services, ISC reported solid Q2 results, with revenue, adj. EBITDA and adj. EPS well above expectations. Momentum appears likely to continue in the near-term, though growth is likely to decelerate back towards historical averages in 2022 and beyond,” said Mr. Treiber.

* Mr. Treiber increased his Open Text Corp. (OTEX-T) target to US$62 from US$60 with an “outperform” rating, while CIBC’s Stephanie Price raised her target to $110 from $105 with an “outperformer” rating. Others making changes include: Scotia Capital’s Paul Steep to US$59 from US$57 with a “sector outperform” rating; Barclays’ Raimo Lenschow to US$57 from US$56 with an “equalweight” rating and Raymond James’ Steven Li to US$63 from US$59 with an “outperform” rating. The average is US$57.86.

“In our view, Open Text exceeded our and Street revenue expectations given stronger-than-expected across all revenue lines with the largest dollar contribution to the outperformance from Cloud, Maintenance & Support, and License revenue,” said Mr. Steep. “The firm delivered adjusted EBITDA and EPS ahead of our forecasts given higher-than-anticipated Cloud and License margins.

“Overall, we see the stock as an attractive option in the Canadian technology landscape given its reasonable valuation and potential upside from its proven acquisition model. Open Text’s expansion of the EIM market to include broader items such as analytics, security, and managed services has significantly expanded the potential universe of acquisitions given the company’s horizontal focus across information in the enterprise. We remain positive on the stock given its (1) strong cash generation, (2) growth potential from M&A + organic initiatives, and (3) reasonable valuation against peers.”

* Mr. Treiber also bumped up his Constellation Software Inc. (CSU-T) target to $2,300 from $2,100 with an “outperform” rating, while CIBC’s Stephanie Price raised her target to $2,200 from $2,000 with an “outperformer” rating, Raymond James’ Steven Li increased his target to $2,100 from $2,000 with a “market perform” rating and Scotia Capital’s Paul Steep moved his target to $2,100 from $2,000 with a “sector outperform” rating. The average is $2,136.90.

“We characterize Constellation’s Q2 as good enough,” said Mr. Treiber. “Revenue, adj. EBITDA and adj. EPS were all within 5 per cent of our estimates and consensus. While it’s easy to get bogged down in the minutia of the quarter, at a high-level, Constellation is successfully scaling its model; Constellation’s growth on a 2-year basis (normalizing for COVID) is above its 5-year pre-COVID average.”

* RBC’s Darko Mihelic raised his Sun Life Financial Inc. (SLF-T) target to $71 from $69 with a “sector perform” rating, while CIBC’s Paul Holden increased his target to $72 from $70, exceeding the $71.64 average, with a “neutral” rating.

* RBC’s Robert Kwan bumped up his Keyera Corp. (KEY-T) target to $36 from $33 with an “outperform” rating, while National Bank’s Patrick Kenny raised his target to $36 from $35 with an “outperform” recommendation. The average is $34.50.

“We chalk up the stock’s performance following the Q2/21 results as ‘sell the news’ (which has been a bit of a theme this quarter) as well as likely a measure of disappointment that Keyera did not raise its Marketing guidance range based on feedback we received heading into Q2/21 results. In an absolute basis, Keyera delivered a solid quarter, particularly from the historically challenging Gathering & Processing segment, with no company,” said Mr. Kwan.

* RBC’s Irene Nattel increased her Saputo Inc. (SAP-T) target to $47 from $46, topping the $42.22 average, with an “outperform” rating and National Bank Financial’s Vishal Shreehard raised his target by $1 to $41 with a “sector perform” rating, while CIBC’s Mark Petrie cut his target to $42 from $43 with an “outperformer” rating.

“While we are shaving our F22 EBITDA forecasts, consistent with commentary provided on today’s call, long-term outlook remains largely unchanged and reflects the combination of normalizing demand, notably in foodservice, and the benefit of more favourable price agreements as SAP cycles pandemic-led, competitive pricing dislocation, particularly in commodity mozzarella. Reiterating OP rating on favourable medium-long term outlook, with high-single-digit organic EBITDA CAGR to F25 augmented by likelihood of M&Aactivity not reflected in our forecasts,” said Ms. Nattel.

* RBC’s Sabahat Khan raised his Stantec Inc. (STN-T) target to $59 from $53 with a “sector perform” rating, while Scotia Capital’s Mark Neville bumped up his target to $66 from $63 with a “sector outperform” rating and Desjardins Securities’ Benoit Poirier bumped up his target to $66 from $59 with a “buy” recommendation. The average is $65.46.

“We believe STN is well-positioned to unlock shareholder value through a combination of M&A and organic growth (strong US exposure a key advantage for the upcoming US infrastructure stimulus package),” said Mr. Poirier.

* National Bank Financial analyst Jaeme Gloyn hiked his Goeasy Ltd. (GSY-T) target to $196 from $167, maintaining an “outperform” rating and Raymond James’ Stephen Boland raised his target to $182 from $168 also with an “outperform” recommendation. The average is $182.17.

* Canaccord Genuity analyst Aravinda Galappatthige cut his target for Quebecor Inc. (QBR.B-T) to $33 from $36, below the $38.54 average, with a “hold” rating, while RBC’s Drew McReynolds trimmed his target by $1 to $39 with an “outperform” rating.

“Quebecor reported a beat in financial results while the subs were somewhat below expectations. Consolidated adj. EBITDA was higher than our forecasts coming in at $501.4-million, up 5.4 per cent year-over-year, driven by higher revenues across most businesses (except cable telephony) with wireless service and internet revenue growth being the highlights,” Mr. Galappatthige said.

* Canaccord’s Scott Chan reduced his Onex Corp. (ONEX-T) target by $1 to $103 with a “buy” rating, while CIBC’s Nik Priebe raised his target to $110 from $105 with an “outperformer” recommendation. The average is $109.20.

* Mr. Chan raised his Manulife Financial Corp. (MFC-T) target to $30 from $29.50 with a “buy” rating, while RBC’s Darko Mihelic moved his target to $29 from $28 with a “sector perform” recommendation. The average is $29.57.

“Q2/21 results were solid driven by better results in GWAM, Canada, and the U.S., more than offsetting softer Asia results. Overall, our investment thesis is largely unchanged (though we are starting to consider IFRS 17),” said Mr. Mihelic.

* Canaccord’s Mark Rothschild raised his Crombie REIT (CRR.UN-T) target to $18.75 from $17 with a “hold” rating. The average is $18.31.

“Crombie REIT’s (Crombie) financial performance has recovered materially over the past year and there was almost no impact from pandemic-related items on Q2/21 results. Supported by the REIT’s long-term leases with Sobeys and other essential services tenants, we expect steady same-property NOI growth over the long term. Further, as the REIT continues to advance its development pipeline, which largely consists of well located residential developments in Vancouver, Montreal and the GTA, there should be material value creation and NAV growth,” he said.

* Mr. Rothschild increased his RioCan REIT (REI.UN-T) target to $23 from $20.74 with a “hold” rating, while CIBC’s Dean Wilkinson raised his target to $25 from $23 with an “outperformer” rating. The average is $23.25.

* Canaccord’s Brendon Abrams raised his Storagevault Canada Inc. (SVI-X) target to $6 from $5 with a “buy” rating. The average is $5.42.

* ATB Capital Markets analyst Tim Monachello increased his Enerflex Ltd. (EFX-T) target to $13 from $12 with an “outperform” rating, while Stifel’s Cole Pereira raised his target to $11.50 from $11 with a “buy” recommendation. The average is currently $11.42.

“This was an important quarter for EFX, offering a modest earnings beat but more importantly some concrete data points reinforcing that the recovery in its core Engineered Systems business is accelerating,” said Mr. Pereira. “Management expects 2H21e corporate ES bookings to exceed 1H21, indicating that a similar pace should continue through 2021e. From a capital allocation standpoint, we expect EFX to continue to focus on growth, with management highlighting a $100-million asset ownership opportunity pipeline.”

* CIBC World Markets analyst John Zamparo cut his Jamieson Wellness Inc. (JWEL-T) target to $40 from $45, which falls below the $42.28 average, with an “outperformer” rating.

“We expect JWEL will see ongoing and perhaps accelerating cost pressures which could persist into 2022, but we expect sales growth will remain robust and the company should still offer double-digit EBITDA growth, as strong results from 2020 seem here to stay. Investors have been wary of owning names with exposure to higher costs, and also stocks that were seen as pandemic beneficiaries, but JWEL’s international runway provides comfort for long-term growth,” he said.

* CIBC’s Robert Catellier lowered his target for Inter Pipeline Ltd. (IPL-T) to $20 from $20.50 with a “neutral” rating. The average is $19.39.

* CIBC’s Nik Priebe raised his IGM Financial Inc. (IGM-T) target to $55 from $49, reiterating an “outperformer” rating, while Desjardins Securities’ Gary Ho increased his target to $52 from $49 with a “hold” recommendation. The average is $51.89.

“The company’s strategic investments continue to bear fruit and its wealth and asset management platforms are generating record flows. With pro forma $0.6-billion in uncalled capital, IGM is well-positioned to execute on growth opportunities, dividend increases or buybacks. However, we prefer to see management deliver on expense guidance and we view the shares as fairly valued,” said Mr. Ho.

* Mr. Priebe bumped up his TMX Group Ltd. (X-T) target to $145 from $140 with a “neutral” rating, while TD Securities’ Graham Ryding bumped up his target to $55 from $53 with a “buy” rating. The average is $154.

* CIBC’s Robert Bek raised his Spin Master Corp. (TOY-T) target by $1 to $44, keeping an “outperformer” rating, while Stifel’s Martin Landry raised his target to $58 from $45 with a “buy” recommendation. The average is $51.91.

“Spin Master reported strong Q2/21 results with adjusted EPS of $0.40 much better than our estimate of $0.14 and consensus of $0.20 and up from a loss of $0.09 last year. The strong results come from a healthy sell-in (at least up 60 per cent year-over-year) of Paw Patrol toys at retailers ahead of the movie release on August 20. However, POS decreased 7 per cent year-over-year, due to (1) a difficult comparable for activities, games and puzzles and (2) lean inventories (15-20 per cent lower than historical levels) preventing TOY to fully capture every opportunity. H2 results will be dependent on the company’s ability to adequately stock retailers with products, something we will monitor closely. Spin Master’s strong Q2/21 results translate into an increase of 10 per cent to our 2021 and 2022 EPS estimates,” said Mr. Landry.

* CIBC’s Hamir Patel reduced his Cascades Inc. (CAS-T) target to $18 from $20 with an “outperformer” rating. The average is $18.50.

* CIBC’s Kevin Chiang raised his Bombardier Inc. (BBD.B-T) target to $1.30 from $1 with an “underperformer” rating. Others increasing their targets include: Scotia’s Konark Gupta to $1.50 from 80 cents with a “sector perform” rating; ATB Capital Markets’ Chris Murray to $2 from $1.75 with a “speculative buy” rating and Desjardins Securities’ Benoit Poirier to $1.75 from $1 with a “hold” rating. The average is $1.50.

“BBD reported another solid quarter with better-than-expected FCF generation,” said Mr. Poirier. “Accordingly, management increased its 2021 guidance, now targeting FCF usage of less than US$300-million for the year (vs US$500-million). We are very pleased with the level of execution demonstrated since the launch of the turnaround plan, although we prefer to remain on the sidelines as we believe indebtedness is still too high.”

* Raymond James analyst Craig Stanley downgraded Newcore Gold Ltd. (NCAU-X) to “outperform” from “strong buy” with a $1.30 target, down from $1.60 and below the $1.81 average.

* Cormark Securities analyst Gavin Fairweather cut Quarterhill Inc. (QTRH-T) to “market perform” from “buy” with a $2.75 target, down from $3.50 and below the $3.25 average.

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