A roundup of some of the North American equities making moves in both directions today
On the rise
SNC-Lavalin Group Inc. (SNC-T) soared after it reported a profit attributable to shareholders of $73-million in its latest quarter compared with a loss of nearly $66-million in the same quarter last year.
Chief executive Ian Edwards says the company had a strong start to the year with a first quarter in line with expectations.
The engineering firm says its profit from continuing operations was $67.7-million or 39 cents per share for the quarter ended March 31 compared with a profit of $950,000 or a penny per share a year earlier.
SNC says the profit included $61-million or 35 cents per diluted share from professional services and project management compared with a profit of $21-million, or 12 cents per diluted share in the same quarter last year.
The company’s profit from continuing operations from its capital business was $6.7-million or four cents per diluted share in the first quarter of 2021 compared with a loss of $20-million, or 11 cents per diluted share in the first three months of 2020.
On an adjusted basis, SNC says its profit from its professional services and project management business was 48 cents per share, up from 35 cents per share a year ago.
Onex Corp. (ONEX-T) rose in the wake of reporting a net profit of US$415-million in its latest quarter compared with a net loss of US$997-million in the same quarter last year.
The private equity investment firm says the profit amounted to US$4.59 per diluted share for the quarter ended March 31 compared with a loss of US$9.97 per diluted share in the first three months of 2020.
Onex says its segment net earnings, which excludes certain items, totalled US$472-million or US$5.23 per diluted share, up from a segment net loss of $1.05-billion or US$10.34 per diluted share a year ago.
The company’s investing segment earnings grew to US$324-million compared with a loss of US$985-million a year ago, while its asset and wealth management segment earned US$148-million compared with a loss of US$67-million in the same quarter last year.
Onex chairman and CEO Gerry Schwartz says the company reported another quarter of good results across its platforms.
Mr. Schwartz says its private equity investments continued to generate strong value and its credit platform is saw momentum with its new strategies.
Shares of Transat AT (TRZ-T) gained with Quebec media magnate Pierre Karl Péladeau abandoning his effort to buy the Canadian travel company,, increasing the odds it will now go it alone as it tries to rebuild its decimated business in the months ahead.
Mr. Péladeau, chief executive and controlling shareholder of Quebecor Inc., is walking away after a disagreement with Transat’s main shareholder, Letko Brosseau and Associates, over the travel company’s valuation. Letko believes Transat is worth more than $5 per share and Mr. Péladeau does not, he told Quebecor’s tabloid Journal de Montréal newspaper Thursday.
The media executive also castigated Transat’s leadership for failing to bring his two previous offers for the company to shareholders. Mr. Péladeau has previously said he was prepared to offer $5 per share for Transat, an investment the multi-millionaire intended to make on a personal basis and not via Quebecor.
“I’m no longer interested,” Mr. Péladeau is quoted as saying. “If I make a new offer, I know it’s not going get through. What’s the point of making one when you know the biggest shareholder is going to refuse?”
- Nicolas Van Praet
DoorDash Inc. (DASH-N) was higher after it raised its forecast for annual gross order value late Thursday, as stimulus checks helped keep food delivery demand resilient in the first quarter even as vaccinations and an easing of restrictions encouraged people to dine out again.
However, DoorDash said those same government benefits were partly responsible for delivery drivers working fewer hours in the quarter, reducing the number of deliveries it was able to make.
The company, along with rivals Uber Eats and Grubhub Inc have benefited from a surge in demand for app-based delivery services in the last year as the COVID-19 situation kept people at home.
DoorDash, which has also branched out into delivery from grocery and convenience stores last year, reported a near three-fold jump in quarterly revenue to US$1.08-billion, beating analysts’ estimates of US$993.3-million, according to IBES data from Refinitiv.
“As markets continued reopening and in-store dining increased across the United States, the impact to our order volume was smaller than we expected, which contributed to strong performance in the quarter,” the company said in a statement.
However, the company added that it expects demand to slow as the effects of stimulus wear off.
DoorDash said it expects full-year marketplace gross order value (GOV) of US$35-billion to US$38-billion, up from its previous forecast of US$30-billion to US$33-billion. Marketplace GOV is the total value of all orders placed on its app as well as fees for its DashPass subscription service.
The company also raised the top end of its forecast for full-year adjusted earnings before interest, taxes, depreciation, and amortization to between break-even and US$300-million, compared to a previous forecast of as much as US$200-million.
Airbnb Inc. (ABNB-Q) increased with it beating Wall Street expectations for first-quarter gross bookings and revenue, as speedy COVID-19 vaccinations and easing restrictions encouraged more people to check into its vacation rentals.
Gross bookings jumped 52 per cent to US$10.29-billion in the quarter, easily beating analysts’ estimates of US$6.93-billion.
“For guests aged 60 and above in the U.S., who were amongst the first groups to benefit from vaccine rollouts, searches on our platform for summer travel increased by more than 60% between February and March 2021,” Airbnb said.
The San Francisco-based company expects second-quarter revenue to be similar to 2019 levels, adding that the return of urban and cross-border travel is likely to underpin growth over the coming quarters.
Airbnb is also set to benefit from demand for longer stays and a shift to traveling in groups by business travelers, Chief Executive Officer Brian Chesky said on a post-earnings call.
The company has weathered the pandemic better than rivals as people turned to its offering of larger spaces and locations away from major cities in the era of social distancing.
Airbnb, however, said it was too early to predict if the recovery momentum would continue at the same pace in the second half of 2021.
Its revenue rose 5.4 per cent to US$886.9-million in the first quarter ended March 31, exceeding estimates of US$714.4-million, according to Refinitiv IBES data.
Adjusted loss before interest, taxes, depreciation and amortization narrowed to US$59-million, from US$334-million a year earlier, largely due to cost cuts.
On the decline
Shares of Canadian Pacific Railway Ltd. (CP-T) were narrowly lower in the wake of Kansas City Southern (KSU-N) switching suitors late Thursday, endorsing a US$30-billion offer from Canadian National Railway Co. (CNR-T) and spurning its US$25.2-billion bid.
On Friday, a previously announced 5-for-1 share split took effect. The move was revealed in late January to encourage greater liquidity by making shares available to a wider group of investors.
KCS, which operates a network that links the U.S. Southwest to Mexico, said its board and advisers found Montreal-based CN Rail’s offer of US$200 a share in cash and 1.129 common shares to be a “superior proposal” to the friendly bid of US$90 in cash and 0.489 of a share that CP Rail announced in March.
On Thursday, CN Rail also raised its offer by agreeing to pay a US$700-million break fee that KCS will owe to CP Rail if their transaction fails to close.
“We are delighted that KCS has deemed CN’s binding proposal superior,” Jean-Jacques Ruest, president and chief executive officer of CN Rail, said in a release. He said the KCS board’s endorsement recognized “the many compelling benefits of our combination and expressing confidence in CN’s ability to obtain the necessary approvals and successfully close the transaction.”
CN Rail chair Robert Pace added: “We are the better bid, better partner, better railway and best solution for KCS, and are pleased that the KCS board of directors has recognized the superiority of our proposal.”
- Andrew Willis
Aurora Cannabis Inc. (ACB-T) fell after announcing it would move its U.S. stock listing to the Nasdaq due to the exchange’s “cost-effectiveness,” following similar moves by rivals last year.
Its shares, currently listed on the New York Stock Exchange, dropped as it missed expectations for third-quarter revenue, hit by the impact of coronavirus-induced restrictions in Canada.
“This listing transfer will enable us to realize cost efficiencies as part of our efforts to deliver long-term value to shareholders,” Chief Executive Officer Miguel Martin said in a statement.
Rivals Canopy Growth Corp and Aphria Inc also moved their U.S. listings to the Nasdaq in 2020, citing lower costs. Aphria delisted this year after its reverse merger with Nasdaq-listed Tilray .
Aurora’s loss amounted to 85 cents per share in the quarter ended March 31 compared with a loss of $1.40 last year.
Its net revenue reached $55.2-million in the third quarter, down from $73.5-million last year.
The company was expected to report a net loss of 21 cents per share on revenues of $68.5-million, according to financial data firm Refinitiv.
See also: Friday’s analyst upgrades and downgrades
Canadian miner Centerra Gold Inc. (CG-T) dropped after the Kyrgyz Republic state company that owns 26 per cent of its shares said in a regulatory filing it intends to sell about 19 per cent of its holdings.
Kyrgyzaltyn JSC, said it intended to sell 14.8 million of its 77.4 million Centerra shares.
Earlier this week, Centerra reported the Kyrgyz Republic Parliament had passed a law that would allow the government to impose “external management” of its Kumtor gold mine if the operating company, Kumtor Gold Co., violates certain Kyrgyz laws.
Centerra also said Kumtor Gold Co. was ordered by a Kyrgyz Republic court last week to pay more than US$3 billion in damages after a ruling that its past practice of placing waste rock on glaciers was illegal, adding it has received further tax assessments that add to claims worth hundreds of millions of dollars.
Centerra says it believes the actions are a concerted effort to coerce it to give up economic value or ownership of the Kumtor mine or to falsely justify a nationalization of the mine. It says it is committed to trying to work with Kyrgyz Republic authorities, but that it will not hesitate to use all legal avenues to protect its rights and interests.
Walt Disney Co. (DIS-N) slid in the wake of its streaming growth falling short of Wall Street estimates after seeing strong consumer demand early in the pandemic, while the company’s quarterly profit topped forecasts.
CEO Robert Chapek said that movie and television shows were resuming normal production and new offerings would help spur subscriber growth across Disney+, ESPN+, Hulu and Hotstar.
Adjusted earnings-per-share came in at 79 US cents for January through April 3, Disney said. Analysts had expected 27 US cents, according to IBES data from Refinitiv.
Disney is focusing on quickly building its streaming service to challenge Netflix Inc. (NFLX-Q) as audiences move away from cable TV. The company’s popular theme parks remain in recovery mode with attendance limits due to the COVID-19 pandemic.
“(Disney+) growth is significantly decelerating as the initial pandemic boost has waned,” eMarketer analyst Eric Haggstrom said. “Given Disney’s content investments, subscriber growth should return strongly once this short-term turbulence ends.”
Disney+ reached a total of 103.6 million customers as of early April, the company said. Two Marvel superhero series, WandaVision and The Falcon and the Winter Soldier, debuted during the quarter. Analysts had projected 109.3 million, according to FactSet.
With files from staff and wires