A roundup of some of the North American equities making moves in both directions today
On the rise
Thomson Reuters Corp. (TRI-T) rose after it reported higher first quarter revenue and operating profit on Tuesday, helped by its three main divisions and a rebounding economy, saying full-year sales growth will be at the high end of original estimates.
Adjusted earnings per share, which exclude a gain from the sale of the company’s investment in Refinitiv and other adjustments, rose to 58 US cents per share, from 48 US cents in the prior-year period. That was well ahead of the 42 US cents analysts expected, according to Refinitiv estimates.
Thomson Reuters, which owns Reuters News, said in a statement that operating profit rose by a third to US$387-million during the first quarter.
Total sales at Thomson Reuters were up 4 per cent to US$1.58-billion, ahead of estimates, and the company said they are forecast to grow 3.5 per cent to 4 per cent for the full year.
However, he cautioned that risk remained as the COVID-19 pandemic has surged in some parts of the world. les gains between 3 per cent and 7 per cent.
“Our customers are more confident in an improving economic environment and those positive prevailing tailwinds were reflected in strong sales across our businesses,” Steve Hasker, Thomson Reuters Chief Executive, said in a statement.
However, he cautioned that risk remained as the COVID-19 pandemic has surged in some parts of the world.
Suncor Energy Inc. (SU-T) was narrowly higher after it reported first-quarter profit after a loss in the prior quarter, buoyed by a recovery in crude prices from the pandemic-led lows hit last year and cost cutting measures.
Like many of its peers, Suncor has been benefiting from a rebound in oil prices driven by a recovery in global fuel demand, after it was decimated in 2020 due to coronavirus lockdowns.
But the pandemic continues to rage in certain parts of the world and the demand outlook remains uncertain.
Canada’s second-biggest oil producer said total production rose to 785,900 barrels of oil equivalent per day (boepd) during the first quarter ended March 31, from 769,200 boepd a quarter earlier.
Chief Executive Officer Mark Little said strong performance and free fund flow helped reduce its total debt by $1.1-billion and repurchase over $300-million in common shares in the quarter.
The company posted net earnings of $821-million, or 54 cents per share, for the period, compared with a loss of $168-million, or 11 cents per share, in the quarter ended Dec. 31.
The Toronto-based commercial real estate services provider reported revenue of US$774.9-million, up from US$630.6-million during the same period a year ago and above the Street’s forecast of US$685.2-million.
On a per-share basis, the Toronto-based company said it had profit of 11 US cents. Earnings, adjusted for non-recurring costs and stock option expense, were US$1.04 per share. The consensus projection was 63 US cents.
Colliers now expects revenue and EBITDA to rise between 15-30 per cent in 2021, up from a previous ranges of 10-25 per cent, citing “stronger than expected operating results for the first quarter.”
Nutrien Ltd. (NTR-T), the world’s biggest fertilizer producer by capacity, rose after new Chief Executive Mayo Schmidt said on Tuesday it will continue its existing business strategy, including a focus on supporting global potash prices over maximizing sales.
Surging prices of corn, soybeans and canola have given North American farmers more incentive to spend on fertilizer, lifting profits for Nutrien. Even so, Canada’s biggest agriculture company hired Mr. Schmidt as CEO last month to replace Chuck Magro, who resigned.
“When we think about potash, we’re certainly focused on price over supply,” Mr. Schmidt said in his first conference call with analysts since taking the top job in April.
Mr. Schmidt added that the company sees steady potash demand growth for the next decade.
Mr. Schmidt, who was previously Nutrien’s chairman, also said the company is stronger by keeping together its wholesale fertilizer production business and its farm retail network.
In changing CEOs, Nutrien’s board of directors wants to see better execution of its existing strategy under a fresh set of eyes, Mr. Schmidt said, listing areas of focus such as logistics and transportation.
Nutrien’s farm retail stores, which sell fertilizer, seed and chemicals to farmers, make up the largest U.S. network. Schmidt said the company would look to expand its retail operation in Brazil.
The company expects U.S. plantings of corn and soybeans to exceed U.S. Department of Agriculture estimates by 2 million acres each this year, but Schmidt said prices look to remain strong throughout the year.
The world’s biggest fertilizer producer by capacity raised its full-year profit guidance and swung to a bigger than expected quarterly profit
The Saskatoon-based company posted adjusted net income of US$165-million, or 29 US cents per share, in the first quarter, compared with a loss of US$69-million, or 12 US cents a share, a year earlier. Analysts were expecting a profit of 8 US cents per share.
Pfizer Inc. (PFE-N) rose after raising its forecast for 2021 COVID-19 vaccine sales by more than 70 per cent to US$26-billion and saying demand from governments around the world trying to halt the pandemic could contribute to its growth for years to come.
Revenue from the vaccine - developed with German partner BioNTech SE - is expected to account for more than one third of Pfizer’s full-year sales this year.
The forecast is based on already signed contracts for 1.6 billion vaccine doses to be delivered this year. The company said it expects to sign more deals for this year and is in supply talks with several countries for 2022 and beyond.
“Based on what we’ve seen, we believe that a durable demand for our COVID-19 vaccine – similar to that of the flu vaccines – is a likely outcome,” Chief Executive Albert Bourla said.
The two-shot vaccine was Pfizer’s top-selling product in the first quarter. Expenses and profit from the vaccine are split 50-50 between Pfizer and BioNTech.
The two-dose vaccine has shown an efficacy rate of more than 90 per cent in late-stage trials, on par with Moderna Inc’s (MRNA-Q) vaccine but higher than the rates seen from AstraZeneca plc and Johnson & Johnson.
Moderna has forecast US$18.4-billion in 2021 sales of its COVID-19 vaccine.
Pfizer has said it expects to profit from the vaccine, while some drugmakers including Johnson & Johnson have said their vaccine will be available on a not-for-profit basis until the end of the pandemic.
CVS Health Corp. (CVS-N) was up with a first-quarter profit on Tuesday that beat analysts’ estimates and raised its 2021 profit forecast, helped by higher sales at its pharmacies and lower medical costs at its health insurance unit.
CVS has been offering COVID-19 tests at its stores and administering vaccines as part of the ongoing federal program, which the company hopes will increase footfall at the stores.
Same-store sales at the company’s drug stores, which sell over-the-counter health products, rose 0.4 per cent in the reported quarter, while front-store sales fell about 11 per cent, partly due to a weak cough, cold and flu season.
Revenue from the company’s drug stores rose 2.3 per cent for the quarter, also helped by price inflation of branded drugs.
Total revenue for CVS Health rose 3.5 per cent to US$69.1-billion.
CVS Health now expects 2021 adjusted profit of between US$7.56 and US$7.68 per share, from its previous forecast of US$7.39 to US$7.55 per share.
On an adjusted basis, the company earned US$2.04 per share in the quarter ended March 31, above analysts’ estimates of US$1.72 per share, according to Refinitiv IBES data.
U.S. refiner Marathon Petroleum Corp. (MPC-N) finished higher after it reported a smaller-than-expected first quarter loss on Tuesday helped by a jump in refining margin and COVID-19 vaccine rollouts, which drove a rebound in fuel demand.
Marathon, which generated positive adjusted core earnings in its refining and marketing business for the first time since the pandemic began, saw its refining and marketing margins grow over 66 per cent to US$10.16 per barrel from the previous quarter.
“We are beginning to see increases in global mobility and demand for transportation fuels”, Chief Executive Officer Michael Hennigan said.
However, Mr. Hennigan added that the industry continued to struggle with effects of the pandemic in the reported quarter.
Excluding items, Findlay, Ohio-based Marathon reported a loss of 20 US cents per share, in the quarter ended March 31, while the Street was expecting a loss of 71 US cents per share, according to Refinitiv IBES.
On the decline
Cenovus Energy Inc. (CVE-T) was lower after ConocoPhillips (COP-N) outlined a plan to cut its gross debt by US$5-billion over the next five years and its intention to exit its 10-per-cent stake in the Canadian producer by the fourth quarter of 2022.
Conoco became one of Cenovus’ largest shareholders in 2017 when it accepted 208 million shares of the Canadian producer as part of the payment for some of its Canadian assets. As of Monday’s close, the stake would be worth $2.06-billion.
Bausch Health Companies Inc. (BHC-T) was lower after it reported a first-quarter loss of US$610-million compared with a loss of US$152-million a year earlier.
The company says the loss amounted to US$1.71 per diluted share for the quarter compared with a loss of 43 US cents per diluted share in the first three months of 2020.
The results included a US$469-million goodwill impairment charge in its Ortho Dermatologics business and a US$71-million impairment charge related to a product line in Ortho Dermatologics.
On an adjusted basis, Bausch Health says it earned US$370-million for the quarter, up from an adjusted profit of US$316-million for same quarter last year.
Revenue for the quarter totalled nearly US$2.03-billion for the first quarter of 2021 compared with US$2.01-billion in the first quarter of 2020.
Bausch Health says excluding the US$33-million favourable impact of foreign exchange and the $10-million impact of divestitures and discontinuations, revenue fell US$8-million compared with a year ago.
Ballard Power Systems Inc. (BLDP-T) plummeted on weaker-than-anticipated quarterly results.
The Burnaby-based company reported revenue of $17.6-million and a 6-US-cents-per-share loss, missing the Street’s forecasts of US$25.2-million and a 5-US-cent loss due largely to poor performance from its Power Products and Technology Solutions business
Ballard also said the China market was “muted” in the quarter.
In a note, Raymond James analyst Michael Glen said: “We continue to see considerable momentum with respect to hydrogen globally with various collaborations, partnerships, and green hydrogen projects announced daily. Given this momentum, we suspect that most (if not all) investors will be heavily focused on Ballard’s outlook for 2021, and how management sees the industry momentum translating into commercial activity for the company. Specifically, while Ballard management has discussed an extremely active pipeline of customer engagement, we will be looking to understand more readily what is underlying the slow conversions of such interest to purchase orders and backlog.
“In particular, with respect to the Weichai-Ballard JV in China, with the facility now in production and generating revenue ($15.8-million in 2020), we will be interested in a more detailed update regarding the expected ramp, and any indications regarding a renewal purchase order on MEA sales to the JV. Additionally, we will be looking for an update regarding the timing and expected outcome surrounding China’s hydrogen roadmap and indicated policy, and understanding how the Weichai-Ballard JV is positioning itself to benefit as such programs become more defined.”
Parkland Corp. (PKI-T) was down in the wake of announcing it is aiming to about double its earnings in less than five years after swinging to a profit in the first quarter despite lower revenues and fuel volumes sold.
The Calgary-based convenience store operator and fuel retailer says it wants to post $2-billion of adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) attributable to shareholders by the end of 2025, up from $967-million last year and $1.27-billion in 2019.
The increase could come from expanding its existing network, acquisitions and enhancing margins.
Parkland says it had net earnings attributable to shareholders of $31-million or 20 cents per diluted share in the first three months of 2021 on revenue of $4.23-billion, compared with a loss of $79-million or 53 cents per share on revenue of $4.32-billion in the same period of 2020
The company says it sold 5.5 billion litres of fuel and petroleum products in the quarter, a decrease of 6.3 per cent compared with the year-earlier period.
Parkland was expected to earn $71.1-million or 43 cents per share on $4-billion of revenues, according to financial data firm Refinitiv.
Canada’s adjusted EBITDA increased 14 per cent to $116-million in the quarter. International earnings were flat at $67 million while acquisitions drove U.S. earnings up $4-million to $20-million.
In a research note, Desjardins Securities analyst David Newman said: “Despite continued COVID-19 impacts, PKI benefited from lower costs, continued strong fuel margins and c-store SSSG in Canada, U.S. acquisition growth, solid performance in International and higher utilization at Burnaby.”
RioCan Real Estate Investment Trust (REI-UN-T) was lower despite announcing net income climbed to $106.5-million in its latest quarter, as tenants kept paying rent despite the country plunging into another wave of COVID-19.
The commercial property owner says its first-quarter net income was up from the $102.8-million it reported the year prior, at the onset of the pandemic.
Funds from operations, a key metric in real estate, reached $106-million, a drop from $144.6-million last year.
The trust says its FFO per unit amounted to 33 cents per diluted unit for the quarter ended March 31, down from 46 cents per diluted unit previously.
About nine per cent of the trust’s tenants were closed at the end of the quarter and nearly 20 per cent of tenants were shut as of May 3.
The trust says it collected 93.9 per cent of billed gross rent in the first quarter, despite lockdowns in several markets and tightened COVID-19 restrictions.
Under Armour Inc. (UAA-N) slid as it raised its annual profit and sales forecasts after reporting a 35-per-cent jump in quarterly revenue on Tuesday, as reopening markets in the United States and Asia fuel demand for the company’s sports shoes and apparel.
The rollout of COVID-19 vaccines and new rounds of government stimulus lifted consumer confidence for discretionary spending in the first few months of the year, helping Under Armour post a 32-per-cent increase in revenue from North America.
The pandemic also led to a rise in the adoption of outdoor exercises such as jogging and biking, boosting demand for Under Armour HOVR running shoes and easing some of the pain from the closure of gyms and loss of sales to college and high school sports teams.
Revenue from the company’s smaller international segment rose 58 per cent, helped by recoveries in markets including China.
The company said it expects full-year revenue to rise by a high-teen percentage, compared with a previous outlook of a high-single-digit increase.
The sportswear maker lifted its full-year adjusted earnings per share forecast to between 28 US cents and 30 US cents, from 12 US cents to 14 US cents.
The company’s net revenue rose to US$1.26-billion in the first quarter ended March 31, beating analysts’ average estimate of US$1.13-billion, according to IBES data from Refinitiv.
Under Armour said on Monday it had agreed to pay a penalty of US$9-million to settle Securities and Exchange Commission charges relating to its accounting practices.
Excluding certain items, the company earned 16 US cents per share in the first quarter, beating estimates of 3 US cents per share.
ConocoPhillips (COP-N) closed lower in the wake of posting an adjusted profit for the first quarter, ending a streak of losses that lasted for three straight quarters, as the rollout of vaccines boosts travel and lifted crude prices.
Higher oil prices and deep cost cuts implemented last year at the peak of a downturn in demand are helping U.S. oil and gas companies including top producer Exxon Mobil Corp. (XOM-N), deliver improved first-quarter profits.
Conoco said its total average realized price was US$45.36 per barrel of oil equivalent in the first quarter, much higher than the US$33.21 it earned in the last three months of 2020.
The company’s total output, excluding Libya, was 1.49 million barrels of oil equivalent per day (boepd), compared with 1.14 million boepd in the fourth quarter.
Conoco said its adjusted profit was US$902-million, or 69 US cents per share, for the three months ended March 31, compared with a loss of US$201-million, or 19 US cents per share, in the sequentially previous quarter.
With files from staff and wires