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

Stifel analyst Martin Landry thinks Alimentation Couche-Tard Inc.’s (ATD-T) plan to double its earnings per share over the next five years is “well-constructed” and sees upside potential to its targets for fiscal 2028.

On Wednesday, the Montreal-based company introduced a plan to increased its earnings before interest, taxes, depreciation and amortization (EBITDA) by an annual rate of 12 per cent over the next five years, reaching $10-billion. That exceeds Mr. Landry’s previous estimate of $8.7-billion while falling largely inline with investors’ expectations, according to his recent buyside survey.

“In our view, this plan is credible and achievable but will require a strong execution given the targets established,” said Mr. Landry. “The Circle K brand has grown in awareness and made significant inroads from a small regional brand to a unified global brand. This rising awareness should create value overtime, helped by the introduction of the loyalty program. ATD has the potential to double its EPS in the coming five years, which, combined with a low risk profile and liquid shares, makes Couche-Tard a core holding for Canadian and global portfolio managers, in our view.”

“Couche-Tard expects future acquisitions (including TotalEnergies), to contribute near $2 billion with the remaining growth or $2.24 billion coming from several organic initiatives, which we break down below. Management has a good track record having met or exceed its previous two 5-year plans, increasing our confidence in ATD achieving its target.”

The analyst pointed to three potential downside risks to the target: the “aggressive” cost-cutting expectations with “impressive” expected cost savings of $800-million; risks surrounding fuel demand “especially given the economic slowdown occurring” and the “inherent uncertainty” surrounding the timing of M&A activity.

“Amongst the initiatives and assumptions discussed during the presentations, we see two main areas where there could be upside: (1) The U.S. fuel margin assumption of low $0.40s per gallon appears conservative given that ATD realized $0.47 per gallon in FY23 In addition, there are several sites which have not converted their fuel pumps to the Circle K brand yet, providing further upside from FY23 levels, in our view. (2) We also see upside from the expected increase of $200-million in EBITDA coming from Couche-Tard’s new loyalty program, ‘Inner Circle’. It provides very valuable customer data, enabling ATD to personalize the customer experience and ultimately drive traffic, increase basket size and foster customer loyalty,” he said.

After raising both his fiscal 2025 EPS projection by 7 per cent to $3.47 (from $3.23) and his long-term gasoline margin assumption, Mr. Landry increased his target for Couche-Tard shares to $85 from $81, keeping a “buy” recommendation and touting its “reasonable” valuation. The average target on the Street is $84.94, according to Refinitiv data.

“ATD’s shares trade at approximately 16 times forward earnings, slightly lower than the 5-year average,” he said. “ATD has a better balance sheet than historically with an expected leverage of 2.1 times debt/EBITDA post the closing of the TotalEnergies acquisition, which provides flexibility to make further M&A transactions or return capital to shareholders.”

Elsewhere, others making target adjustments include:

* National Bank’s Vishal Shreedhar to $86 from $81 with an “outperform” recommendation.

“Overall, we found the investor day to be a reiteration of themes that management has previously discussed, though guidance exceeded expectations,” said Mr. Shreedhar. “Specifically, the company announced its 10 for the win 5-year strategy wherein it outlined its $10 billion EBITDA target by F2028, which we believe is ambitious. That said, at this stage, even if ATD falls slightly short, we would consider it to be a positive outcome, considering a favourable growth gap vs. other large cap staples in our coverage.”

* Scotia’s George Doumet to $87 from $82 with a “sector outperform” rating.

“We walked away from the investor day with a sense that while to ‘almost’ double again may sound like an ambitious feat, many of the initiatives underway have been in motion for several years already,” said Mr. Doumet. “In our view, some areas of the plan might prove conservative (M&A and fuel), while others might require long-term fine-tuning (loyalty, FFF and beverage). All in all, we expect growth to be slightly back-half weighted (including loyalty, but with opex savings earlier on).”

* Canaccord Genuity’s Luke Hannan to $84 from $80 with a “buy” rating.

“We came away from the day with a deeper appreciation of Couche-Tard’s scale/positioning in a fragmented market, as well as the opportunities for organic growth within the portfolio,” said Mr. Hannan.

“We believe organic growth initiatives should be supportive of margin growth over the course of our forecast period, while structural market dynamics suggest fuel margins over the medium-to-long term should remain healthy. Furthermore, while we have not incorporated share buybacks into our estimates, we expect the company to be active with its NCIB over the next 12 months.”


National Bank Financial analyst Dan Payne thinks the macro backdrop for oilfield services providers “firmed up” in the third quarter with “the broader economy continuing to positively navigate the persistent challenges and stress of interest rates and recessionary risks, and commodity prices inclined.”

However, ahead of the start of the third-quarter earnings season, he warned that momentum did not “buoy the OFS activity backdrop, where general uncertainty and structural orientation towards sustainable budgets continued to dominate the cadence of the spending cycle, with the U.S. rig count off 10 per cent through the period (down 9-per-cent oil and down 15-per-cent gas).”

In a research report released Friday, Mr. Payne updated his activity forecasts and associated estimates for his coverage universe to account for the firm’s increases to its 2023 and 2024 oil price projections.

“The punchline for the OFS group remains; what is the clearing multiple for a high-quality, resilient and sustainable earning profile?,” he said. “The group has positively navigated the deterioration in the rig count, with share prices generally looking through recent activity weakness (and contracting earnings estimates), in support of general multiple expansion (a positive sign for the willingness of the market to recognize that sustainable value profile) and material headroom continues to exist towards historical multiples (trading at a 40-per-cent discount to historical). With that, we will await further colour on the resilience of earnings through third-quarter reporting, but for the time (and conceivably until the upstream proves that inflection to activity), we have made associated revisions to our forecasts (largely relating to the timing and cadence of spending programs), estimates, targets and ratings (rolling and risking our target price multiples to 2024 from 2023) and are ordinally ranking our coverage through the lens of relative momentum of a) earnings versus b) valuation, which has us oriented as 1) PSI (bulletproof), 2) TCW (best market exposure), 3) PD (generally insulated) and 4) EFX (absolute holding pattern), while we continue to believe that all high-quality participants should be benefactors of patience through what has always been projected to be a longer-duration cycle.”

The analyst cut his target for Enerflex Ltd. (EFX-T) to $14 from $10, reiterating a “sector perform” rating. The average on the Street is $12.47.

“Undoubtedly the most highly anticipated quarter to come, EFX should report Q3/23 on November 8 after market, with a view of re-establishing sentiment around the stability of its financial results,” said Mr. Payne. “Recall, its CFO (Rod Gray) recently resigned at quarter-end after a 90-day tenure, for reasons of ‘fit.’ That event, on the back of inconsistent financial results and guidance over recent quarters (see reaction to Q2/23 results), conspired against the markets comfort and confidence, with the stock trading off materially (down 31 per cent year-to-date vs. OSX up 12 per cent). Since then, while guidance has not been formally reiterated, management has made public statements in support of the state of its business and value prospects, and for which, third-quarter results will serve as the first opportunity to be formally validated. That said, this will come on the back of an interim CFO (recently appointed; formal search ongoing) and true validation of its potential may not come until further formalization of its executive ranks, guidance and longer-range reporting is established through year-end (i.e., Q4/23 to be reported in March ‘24). So… what do we think? All indications are that the business continues to progress as expected, with financial results expected to be largely flat sequentially (see below) with margins largely intact relative to the prior quarter (some aberrations in the prior quarter due to a one-time recovery) and that profile to further resonate through the fourth quarter, albeit with free cash minimized due to culmination of growth and non-discretionary spend and leverage modestly improving. To that end, and in summary, we believe the primary impediment to value here remains the complexity of integrating such a significant (and diverse) merger, the near-term costs and commitments of which prove to delay the realization of synergies of the high-graded business (remain to be seen). The proof (and value opportunity) will be in the pudding, and we expect first quarter results will serve as a baseline to re-establishing credibility (hopefully complemented by insider buying), while forthcoming 2024 guidance (to come around calendar year-end) should continue to prioritize maximization of free cash (minimal spend) in support of its ultimate value potential.”

He maintained his targets for these stocks: Precision Drilling Corp. (PD-T, “outperform”) at $135, Pason Systems Inc. (PSI-T, “outperform”) at $20 and Trican Well Service Ltd. (TCW-T, “outperform”) at $6.75. The averages are $133.53, $16.64 and $5.94, respectively.


In a research report released Friday titled Starting to turn the page on a difficult 2023, Desjardins Securities analyst Jerome Dubreuil said he’s starting to see positive momentum building for Canadian telecommunications companies, including a “initial signs of competition stabilizing” in wireless.

“Since the beginning of the year, our bearish stance on the sector has been based on (1) increased competition; (2) a challenging regulatory outlook; (3) higher interest rates; and (4) the combination of the upcoming spectrum auction and the telcos’ leverage being at historical highs,” he said. “We anticipate an improvement in the sector’s fundamentals, with initial signs of competition stabilizing, QBR appearing to take a measured approach to its national expansion and demographic trends remaining strong. However, we hesitate to suggest adding meaningful exposure to Canadian telecoms ahead of an imminent TPIA rate decision since the sector is not particularly cheap relative to current government yields.”

Ahead of earnings season for the sector, Mr. Dubreuil said he’s “starting to warm” to Rogers Communications Inc. (RCI.B-T).

“RCI’s management sounded the most upbeat during the recent conference season, speaking positively of wireless net additions in the quarter and the realization of synergies,” he said. “We do see attractive value in the stock, especially based on 2025 estimates, which should be reflected as more analysts move their valuation to this period when RCI issues guidance in January. Nonetheless, we have near-term concerns with the company’s high exposure to consumer Internet (especially post the Shaw deal) and high leverage (not that we have concerns on RCI’s credit) ahead of the CRTC’s decision on Internet wholesale access and heading into the spectrum auction.”

After adjusting for higher interest rates, he lowered his target for Rogers shares to $66.50 from $71, keeping a “hold” recommendation. The average target on the Street is $73.27.

Calling Quebecor Inc. (QBR.B-T, “buy”) “a strong fourth player, indeed,” he affirmed the company as his “preferred name,” trimming his target to $36.50 from $37.50. The average is $39.21.

“QBR’s stock has underperformed since August 11 after it reported decent 2Q23 results, which coincided with rumours that RCI would appeal the CRTC’s MVNO rate decision,” he said. “Nonetheless, the stock remains the best performer in the year to date in the Canadian telecom space, which we believe is justified given QBR does not immediately need MVNO access as a roaming deal is already in place with RCI. Still, we believe MVNO access would be beneficial for QBR, especially when roaming traffic increases down the road. We would highlight that the final resolution of the MVNO rate decision will be retroactive for QBR, further offsetting the impact of the appeal process. Meanwhile, the CRTC communicated its decision in relation to the MVNO rates QBR will pay BCE under the MVNO regime. Importantly, the CRTC chose BCE’s offer in the final offer arbitration process. Although the regulator sided with BCE, we note that already having attractive rates in place with RCI may have enabled QBR to propose a more aggressive offer to BCE. Overall, we view the decision as a slight positive for QBR as it provides a broader potential area of network coverage at a price that still allows the company to make profits even where it does not have network coverage. We believe the new regime could enable QBR to accelerate subscriber growth without risking a hit on roaming fees in the future.”

Mr. Dubreuil’s other changes include:

  • BCE Inc. (BCE-T, “hold”) to $56 from $60. Average: $60.25.
  • Cogeco Communications Inc. (CCA-T, “buy”) to $77 from $83. Average: $78.61.
  • Telus Corp. (T-T, “buy”) to $26 from $27. Average: $28.13.


CIBC World Markets analyst Hamir Patel is expected “another weak quarter” for paper, forest products and packaging companies in his coverage universe.

“Heading into Q3 reporting, we are making further downward revisions to our wood products estimates as high mortgage rates (7.6 per cent plus), concerns around offshore lumber imports (up 17 per cent month-over-month in August) and Southern capacity additions are weighing on industry operating rates,” he said. “Last week, we highlighted that 2024 consensus estimates may see meaningful downward revisions in coming weeks (potentially over 50 per cent for some LumberCos), with the rebound that had been expected next year likely pushed out to 2025 (and only a moderate uplift next year).

“Reflecting our more cautious outlook, we have now reduced our EBITDA estimates on the lumber companies in 2024 by an average of 51 per cent (as well as reducing our Q4/23 estimates by almost 70 per cent). Reflecting healthy OSB profitability, our estimates for West Fraser next year have been reduced only 20 per cent. While R&R volumes held up well over H1, channel checks suggest demand has eased in H2 with less renovation activity tied to buying/selling (as active listings are down 15 per cent with homeowners ‘trapped’ in their homes by low legacy mortgage rates).”

With those estimate reductions, Mr. Patel made a series of target price adjustments to stocks on Friday.

“While the sector is somewhat lacking in near-term catalysts, valuation looks quite attractive on longer-term metrics (mid-cycle EV/EBITDA multiples two to three turns lower than historical averages and 55-75 discounts to replacement), while SPF lumber prices have limited downside risk with current levels already below breakeven for B.C. Interior producers,” he concluded. “With share prices across the group already having sold off since the summer, we expect the market to look past weak H2/23 performance given still-strong balance sheets, favorable medium-term demographic tailwinds for housing, and the likelihood of the depressed lumber market accelerating permanent supply reductions in B.C..”

His changes include:

  • Adentra Inc. (ADEN-T, “outperformer”) to $35 from $39. The average target on the Street is $43.25.
  • Canfor Corp. (CFP-T, “outperformer”) to $23 from $28. Average: $28.40.
  • Canfor Pulp Products Inc. (CFX-T, “neutral”) to $2 from $2.25. Average: $2.28.
  • Conifex Timber Inc. (CFF-T, “underperformer”) to $1 from $1.60. Average: $1.50.
  • Doman Building Materials Group Ltd. (DBM-T, “outperformer”) to $9 from $8.50. Average: $9.08.
  • Interfor Corp. (IFP-T, “outperformer”) to $29 from $32. Average: $33.
  • Mercer International Inc. (MERC-Q, “underperformer”) to US$7.50 from US$8. Average: US$8.25.
  • Stella-Jones Inc. (SJ-T, “neutral”) to $74 from $72. Average: $78.43.
  • Transcontinental Inc. (TCL.A-T, “outperformer”) to $16 from $17. Average: $17.10.
  • West Fraser Timber Co. Ltd. (WFG-T, “outperformer”) to $119 from $141. Average: $107.23.
  • Western Forest Products Inc. (WEF-T, “neutral”) to $1 from $1.25. Average: $1.13.

Mr. Patel said: “Recommendations: Within the LumberCos, our pecking order is: 1) West Fraser (low-cost producer with best track record),  2) Interfor (pure-play producer, albeit with the least robust balance sheet of the three), and 3) Canfor (cheapest valuation with greatest potential of being acquired). We remain on the sidelines on smaller-cap lumber producers with operations focused in British Columbia (Western FP and Conifex). In the building products space, we have Outperformer ratings on Doman and ADENTRA (specialty distributor with share gain upside). In the pulp/packaging space, our Outperformer-rated names include CCL (diversified global packaging platform), Transcontinental (printing demand concerns easing and falling input costs) and Winpak (defensive food/bev play with above-market growth prospects).”


In other analyst actions:

* With its preliminary third-quarter operating results, Raymond James’ Brian MacArthur cut his Barrick Gold Corp. (GOLD-N, ABX-T) target by US$1 to US$25 with an “outperform” rating, while BMO’s Jackie Przybylowski lowered her target to US$30 from US$31 with an “outperform” rating. The average is US$22.12.

“Barrick reported Q3 production, sales, and unit cost which missed our estimates and consensus expectations,” said Ms. Przybylowski. “However, the company expects production will improve in Q4 as progress such as the Pueblo Viejo expansion drives higher production. Despite the weakness versus published expectations, Barrick’s share price outperformed peers today after the release, potentially because the weakness was understood by investors. We maintain our Outperform rating; incorporating the Q3 actual results drops our one-year target.”

* Morgan Stanley’s Patrick Wood lowered his Bausch and Lomb Corp. (BLCO-N, BLCO-T) target to US$18.50 from US$20 with an “equal-weight” rating. The average is US$21.15.

“Street numbers heading into Q3 look pretty well balance to us for B+L, with perhaps some small downside risk on a slower Rx business (scripts now down low single digits) offset by the potential for bounceback on stronger contacts (post supply issues) and positive commentary around MIEBO,” said Mr. Wood. “We actually think Q3 is more important as a window into come competitive dynamics heading into 2024 for both B+L and the industry overall, across both IOLs and Contacts given multiple new U.S. market entrants in the former (Zeiss, BVI, B+L’s Envy lens etc) and expanded offerings in the latter. As an ophthalmology business, B+L has the enviable position of having absolutely nothing to do with GLP-1s, and while this is appealing, it has been pulled along with the group in aggregate. Regardless, we view 2024 as something of a transition year with higher OPEX and much of the payback from launches (MIEBO, Envy, Xiidra ramp) acting more as an H2 and 2025 kicker for B+L.”

* Though he thinks its third quarter looks “solid,” National Bank’s Rupert Merer cut his Brookfield Renewable Partners LP (BEP-N, BEP.UN-T) target to US$30 from US$34 with an “outperform” rating. The average is US$34.80.

“With BEP shares trading meaningfully lower during Q3, BEP should see some relief from lower management fees,” he said.

“With $400-million in asset sell-downs year-to-date, a $650-million equity raise and $4.5-billion of available corporate liquidity, BEP is well-positioned to realize its growth ambitions in the coming years. Sell-downs could be a challenge in H2E as lower valuations may limit BEP’s willingness to part with assets, but with the BGTF2 fund nearing its official close, BEP has a large war chest to deploy in what is shaping up to be a buyer’s market. In its Q2 conference call, management highlighted potential for both operating asset and public-to-private transactions, an opportunity only available to a select few, including BEP.”

* Raymond James’ Craig Stanley initiated coverage of Dolly Varden Silver Corp. (DV-X), a Vancouver-based company focused on its 100-per-cent-ownedKitsault Valley Project, with an “outpeform” rating and $1 target in a report titled A Silver Treasure in the Golden Triangle. The average is $1.68.

* In response to Thursday’s announcement of an expansion of its credit facility, H.C. Wainwright’s Scott Buck cut his Enthusiast Gaming Holdings Inc. (EGLX-Q, EGLX-T) target to US$2 from US$3, keeping a “buy” rating. The average is $3.03 (Canadian).

“We believe access to additional capital, coupled with a strategic shift toward higher-margin products should provide sight lines to profitability and cash generation,” he said. “We believe this could occur as early as 4Q23,benefiting from seasonal tailwinds. We are currently modeling full year operating profitability in 2024. This profitability comes despite ongoing macroeconomic headwinds which continue to have a negative impact on programmatic advertising. As these headwinds ease, we believe a new leaner Enthusiast Gaming will be positioned to see a meaningful acceleration in revenue growth and rapidly expanding adj. EBITDA margins as operating leverage improves. Revenue growth should be driven by the expansion of the company’s high margin subscription business as well as additional unique gaming content opportunities. Our longer-term optimism is further bolstered by strong underlying secular trends in gaming, which should continue to garner a growing percentage of advertisers’ wallets. We recommend investors take advantage of ongoing share weakness to accumulate a position ahead of stronger operating beginning in 2H23 and carrying into 2024.”

* BMO’s Étienne Ricard cut his targets for Fiera Capital Corp. (FSZ-T) to $8 from $8.50 and Guardian Capital Group Ltd. (GCG-T, GCG.A-T) to $52 from $55 with “outperform” ratings for both. The averages are $7.54 and $53.33, respectively.

“Asset managers face a challenging operating backdrop in Q3 amid continued net outflows, market depreciation and margin pressures; the resulting impact is a 5% average reduction to our calendar Q3 estimates. While current valuations provide a degree of downside protection across the group, VCTR and GCG.A remain our preferred ideas considering their respective margin resiliency and capital deployment optionality,” said Mr. Ricard.

* With the release of a “strong” third-quarter report, Acumen Capital’s Nick Corcoran raised his Firan Technology Group Corp. (FTG-T) target to $5.25 from $5 with a “buy” rating.

“The results demonstrated the financial performance of FTG following the acquisition of Holaday and IMI,” he said. “We will look for further progress on the integration of these acquisitions and completion of negotiations with the union for Aerospace Toronto.”

* Barclays’ Ian Rossouw raised his First Quantum Minerals Ltd. (FM-T) to $28 from $26 with an “underweight” rating. The average is $37.04.

* Mr. Merer also cut his Northland Power Inc. (NPI-T) target to $32, below the $34.57 average, from $35 with an “outperform” rating.

“In what has been a difficult year for NPI and the sector, the company has shown its resilience, issuing its inaugural $500-million green bond and reaching financial close on Baltic Power and Hai Long,” he said. “Despite inflationary cost pressures, the projects should add $230-250-million and $300-320-million in runrate adj. EBITDA, respectively, representing 15-per-cent and 9-per-cent IRRs based on our calculations. There is potential upside to the economics of both projects through partnership sell-downs, debt refinancing post-COD and contingency releases as the projects progress through construction. With financing secured, risk now turns to execution, where NPI has proven its ability to deliver large projects on schedule in the past with its three offshore assets. With high-quality suppliers and contractors and conservative construction timelines, NPI should be able to meet its deadlines.”

* Cormark Securities’ Nicolas Dion cut his K92 Mining Inc. (KNT-T) target to $11 from $14 with a “top pick” designation, while Stifel’s Alex Terentiew lowered his target by $1 to $13 with a “buy” rating. The average is $11.23.

“Despite a more challenging Q3 than we anticipated due to knock-on and ramp-up issues following the previously noted site fatalities on June 28, we strongly view K92′s current share price and underperformance as an opportune time to step in and buy shares,” said Mr. Terentiew. “Q3 production missed our forecast by 12 per cent, but with numerous operating initiatives well underway that we expect to significantly improve mine flexibility and productivity in 2024, we continue to view the Kainantu mine as a world-class operation in the making. While we have trimmed our target by $1 to $13 per share, we are taking a more cautious approach to our valuation as the mine ramps up the expansion. With what we view as a strong balance sheet, significant exploration upside and material growth on the horizon, we encourage investors to step in at these levels.”

* TD Cowen’s David Deckelbaum lowered his Lithium Royalty Corp. (LIRC-T) target to $14 from $18.50, below the $20.32 average, with an “outperform” recommendation.

* RBC’s Sabahat Khan cut his target for MTY Food Group Inc. (MTY-T) to $66 from $71, keeping a “sector perform” rating. The average on the Street is $68.57.

“MTY Food Group Inc. reported Q3 earnings ahead of RBC/ consensus forecasts,” he said. “While the share price reaction has been surprisingly negative, the results reflect good organic progress over the recent quarters and a healthier network following a period of network rationalization. Revising price target to $66 (-$5) to reflect broader caution on the consumer backdrop and reiterate Sector Perform rating.”

* CIBC’s Bryce Adams reduced his Orezone Gold Corp. (ORE-T) target to $2 from $2.15 with an “outperformer” rating. The average is $2.22.

“Orezone released its Phase II expansion study results that we view as a modest positive. Higher-than-expected AISC and total LOM capex offset average annual gold production increasing to 186koz versus our model at 117koz. After model updates, our NPV5-per-cent per share increases to $2.04 from $1.95 prior,” he said.

* CIBC’s John Zamparo raised his Spin Master Corp. (TOY-T) target to $50 from $48, maintaining an “outperformer” rating, while RBC’s Sabahat Khan bumped his target to $51 from $49 with an “outperform” recommendation. The average is $52.71.

“Spin Master’s acquisition of Melissa & Doug adds a complementary pre-school asset and increases the mix of recurring/repeatable revenue for the company. In our view, the expanded/more diversified toy portfolio, increased mix of recurring revenue, and addition of a larger/well-recognized high-margin offering should be received well by investors,” said Mr. Khan.

* Expecting a reduction to its 2023 outlook, Citi’s Ashwin Shirvaikar reduced his Telus International Inc. (TIXT-N, TIXT-T) target to US$8 from US$11 with a “neutral” rating. The average is US$14.36.

‘We are expecting a relatively in-line quarter from TELUS International as we balance near-term visibility against a relatively stable demand environment since the company last reported,” he said. “Though the sequential headwind from the reduction in European-based delivery content moderation services with its second largest client has likely eased somewhat, we expect a continuation of macro-related headwinds (project delays, lower client volumes, slower decision-making, etc.). We believed that the company was not taking an approach to de-risk the outlook as much as some peers and believe that the combination of these macro-headwinds, our expectation of a lowered inorganic contribution, and FX will lead to a lowered revenue outlook range. We continue to believe that the company’s ongoing cost actions should lead to an improving margin trajectory exiting the year (we are at the low-end of the 2023 margin outlook range) but expect the lower expected revenue (and potentially a higher interest expense assumption) to lead to a lowered EPS outlook as well. We believe these lowered outlook expectations are already largely expected by investors and priced in.

“Lower visibility in an uncertain macro remains the key concern for us with the stock also being pressured this year by perceived AI-related risk concerns. We believe some of these AI concerns to be overblown (investors likely misallocating some of this macro-related softness as immediate AI headwinds) and believe some companies in the digital CX world (including TELUS International) could see some AI-related benefits (enhanced agent productivity, greater data annotation demand, etc.). TIXT is currently at relatively low valuation levels ... but we believe a potentially lowered outlook will lead the stock to be rangebound until we get proof points of improving visibility and growth. Valuation and the company’s demonstrated ability to pivot into end-markets with longer-term growth potential can potentially provide some downside support.”

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 29/02/24 2:59pm EST.

SymbolName% changeLast
Adentra Inc
Alimentation Couche-Tard Inc.
Barrick Gold Corp
Bausch Lomb Corporation
Brookfield Renewable Partners LP
Canfor Corp
Canfor Pulp Products Inc
Cogeco Communications Inc
Conifex Timber Inc
Dolly Varden Silver Corp
Doman Building Materials Group Ltd.
Enthusiast Gaming Holdings Inc
Enerflex Ltd
Fiera Capital Corp
Firan Technology Group Corp
First Quantum Minerals Ltd
Guardian Capital Group Ltd Cl A NV
Interfor Corp
K92 Mining Inc
Lithium Royalty Corp WI
Mercer Intl Inc
Mty Food Group Inc
Northland Power Inc
Orezone Gold Corp
Pason Systems Inc
Precision Drilling Corp
Quebecor Inc Cl B Sv
Rogers Communications Inc Cl B NV
Stella Jones Inc
Spin Master Corp
Telus Corp
Telus International [Cda] Inc
Transcontinental Inc Cl A Sv
Trican Well
West Fraser Timber CO Ltd
Western Forest Products Inc

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