A roundup of some of the North American equities making moves in both directions today
On the rise
Shares of Bank of Montreal (BMO-T) rose on Friday after it reported higher fourth-quarter profit and raised its dividend by 25 per cent as strong retail banking income and recoveries from loan loss reserves helped the bank beat analysts’ estimates.
Canada’s fourth-largest bank increased its quarterly dividend to $1.33 per share, from $1.06, and announced a plan to buy back up to 3.5 per cent of its shares – or 22.5 million shares in total. Those were the largest increases announced by any of the Big Six banks this quarter after the federal banking regulator recently lifted temporary restrictions on capital distribution.
For the quarter that ended Oct. 31, BMO earned $2.2-billion, or $3.23 per share, a 36-per-cent increase from $1.6-billion, or $2.37 per share, in the same quarter last year.
Adjusted for certain items, BMO said it earned $3.33 per share, which was well above the consensus estimate of $3.21 among analysts, according to Refinitiv.
“Earnings were fine, if unspectacular,” said John Aiken, an analyst at Barclays Capital Inc., in a note to clients.
BMO joins Bank of Nova Scotia (BNS-T) and Toronto-Dominion Bank (TD-T) as one of three major lenders that exceeded analysts’ expectations in the quarter. Royal Bank of Canada (RY-T), Canadian Imperial Bank of Commerce (CM-T) and National Bank of Canada (NA-T) all fell short of predictions as shrinking profit margins on lending and weaker trading revenue weighed on earnings.
In the fourth quarter, BMO recovered $126-million in provisions for credit losses, reclaiming funds that had been set aside early in the pandemic in case of a surge in loan losses that never happened.
- James Bradshaw
Rogers Communications Inc. (RCI.B-T) was higher in the wake of news director Robert Dépatie is joining the telecom and media giant’s senior leadership team, the first executive change under interim CEO Tony Staffieri after a tumultuous battle for control of the company.
Mr. Dépatie, a telecom industry veteran who was formerly the head of Quebecor Inc. and Quebecor Media, becomes president and chief operating officer of Rogers’s home and business division on Dec. 6.
The newly created position gives him oversight of the connected home business, which offers internet, television and smart home monitoring services; Rogers for Business, which serves large, small and medium-sized enterprises; and the customer service division.
Mr. Dépatie was appointed amid lingering uncertainty surrounding the future of the Toronto-based telecom’s leadership team.
Edward Rogers, the chair of the company’s board and of the family trust that controls the telecom, attempted to appoint Mr. Dépatie president of the cable division in late September, as part of a plan that also involved unseating Joe Natale, then the company’s chief executive officer.
- Alexandra Posadzki
AltaGas Ltd. (ALA-T) finished higher after announcing before the bell a 6-per-cent increase to its annual dividend for 2022 to $1.06 per common share for the 2022 calendar year.
Concurrently, the Calgary-based company said it is moving from a monthly to a quarterly payment schedule with dividends expected to be made in March, June, September and December at the rate of 26.5 cents per share.
“The six percent dividend increase builds upon our prior year dividend increase and reflects the success related to the purposeful actions we have taken over the past number of years to reposition the Company and our confidence in AltaGas being able to deliver continued earnings growth in the years ahead,” said CEO Randy Crawford in a release.
“We believe the six percent increase balances the Company’s desire to return more cash to shareholders with our focus on continuing to de-leverage the balance sheet and fund the strong organic growth opportunities that are on the horizon. We look forward to discussing our strategic priorities and growth plans at our 2021 Investor Day on December 15, 2021.”
On the decline
CWB Financial Group (CWB-T) gave back early gains after it raised its dividend as it reported its fourth-quarter profit rose compared with a year ago to beat expectations.
The Edmonton-based bank says it will now pay a quarterly dividend of 30 cents per share, up from 29 cents.
The increased payment to shareholders came as CWB said it earned a profit attributable to common shareholders of $90-million or $1.01 per diluted share for the quarter ended Oct. 31, up from a profit of $63.4-million or 73 cents a year earlier. Revenue totalled $260.6-million, up from $236.6-million in the same quarter last year.
CWB posted a $10.2-million reversal of its provisions for credit losses, compared with a charge of $19.6-million in the same quarter last year.
On an adjusted basis, CWB says it earned $1.03 per share, up from an adjusted profit 75 cents per share in its fourth quarter last year.
Analysts on average had expected an adjusted profit of 86 cents per share, according to financial markets data firm Refinitiv.
Ride-hailing giant Didi Global Inc. (DIDI-N) plummeted after it said it plans to withdraw from the New York stock exchange just five months after its debut and pursue a Hong Kong listing, a stunning volte-face as it bends to Chinese regulators angered by its U.S. IPO.
Its shares plunged after initially soaring 15 per cent as investors bet the move would appease Beijing and serve as a catalyst for a revival of its business prospects at home.
“Following careful research, the company will immediately start delisting on the New York stock exchange and start preparations for listing in Hong Kong,” Didi said on its Twitter-like Weibo account on Friday.
Didi did not explain its reasons for the plan but said in a separate statement it would organize a shareholder vote at an appropriate time and ensure its New York-listed stock would be convertible into “freely tradable shares” on another internationally recognized stock exchange.
Sources told Reuters last month that Chinese regulators had pressed Didi’s top executives to devise a plan to delist from the New York Stock Exchange due to concerns about data security.
Didi pushed ahead with a US$4.4-billion U.S. initial public offering in June despite being asked to put it on hold while a review of its data practices was conducted.
The powerful Cyberspace Administration of China (CAC) then quickly ordered app stores to remove 25 of Didi’s mobile apps and told the company to stop registering new users, citing national security and the public interest.
Didi, whose apps, in addition to ride-hailing, offer products such as delivery and financial services, remains under investigation.
Redex Research analyst Kirk Boodry, who publishes on Smartkarma, said there is an expectation Didi may need to buy shares at the US$14 IPO price to avoid legal issues and at the very least will pay more than where shares are trading now.
However, there was still uncertainty over what the delisting means for investors. “There may also be some hope that by doing this, Didi management will improve its regulatory relations, but I am less confident on that,” Mr. Boodry added.
Tesla Inc. (TSLA-Q) dropped as U.S. regulatory filings showed on Thursday chief executive Elon Musk has sold another 934,091 shares of the electric vehicle maker worth US$1.01-billion to meet his tax obligations related to the exercise of options to buy 2.1 million shares.
In early November, the world’s richest person tweeted that he would sell 10 per cent of his stock if users of the social media platform approved. A majority of them had agreed with the sale.
Since Nov. 8, Mr. Musk has exercised options to buy 10.7 million shares and sold 10.1 million shares for US$10.9-billion.
Following a flurry of options exercise, Mr. Musk still has an option to buy about 10 million more shares at US$6.24 each, which expires in August next year.
With files from staff and wires