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

Héroux-Devtek Inc. (HRX-T) is “not landing anytime soon,” according to Desjardins Securities analyst Benoit Poirier.

In a research note released Monday, he raised his rating for Longueuil, Que.-based aerospace product manufacturer to “top pick” from “buy” after the release of “impressive” second-quarter results last week.

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“In our view, HRX has not been rewarded by the market for its resilient attributes through the pandemic, namely its greater and growing exposure to the defence sector, management’s strong operational track record, its healthy balance sheet and impressive FCF [free cash flow] generation capabilities,” said Mr. Poirier. “The solid 2Q results reinforce our positive view. We believe the current FCF yield of 14 per cent is too attractive to ignore.”

For the quarter, Héroux-Devtek reported revenue of $137-million, down 6 per cent year-over-year but ahead of the projections of both Mr. Poirier ($129-million) and the Street ($128-million). Adjusted EBITDA of $21.2-million also exceeded expectations ($17.6-million and $17.4-million, respectively).

"2Q FCF of $13.4-million was well above our forecast of $7.0-million, said Mr. Poirier. “The strong FCF beat enabled HRX to reduce net debt to EBITDA to 2.3 times (from 2.5 times; we expected 2.5 times). We forecast that the reduction in EBITDA for FY21 will be more than offset by ongoing inventory reduction and working capital management initiatives, resulting in solid FCF of $64.5-million, yielding an impressive 14.1 per cent.”

“Adjusted EBITDA margin was 15.5 per cent in 2Q (up 70 basis pointes year-over-year), better than consensus and our forecast of 13.6 per cent. We expect further improvements as HRX executes on its restructuring plan and volume improves gradually throughout FY21 and beyond.”

With the results and brighter outlook, Mr. Poirier increased his fiscal 2021 and 2021 earnings per share projections to 69 cents and 82 cents, respectively, from 54 cents and 76 cents.

That led him to increase his target price for Héroux-Devtek shares to $20 from $16. The average target on the Street is $17.17, according to Refinitiv data.

“HRX currently trades at 7.6 times EV/FY2 EBITDA, a discount of 7.7 times versus its U.S. peers despite its stronger balance sheet and robust FCF (FCF yield of 14.1 per cent, the highest among its U.S. peers),” said Mr. Poirier. “We believe HRX’s greater exposure to the defence segment, solid operational reputation and experienced management team position the company ideally for the recovery.”

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Elsewhere, Scotia Capital’s Konark Gupta raised his target to $19 from $16.50 with a “sector outperform” rating (unchanged).

“HRX remains our top small cap pick, and we encourage investors to take advantage of its attractive valuation to benefit from years of forecast growth ahead,” said Mr. Gupta.

Raymond James' Bryan Fast raised his target to $12.50 from $10.50 with a “market perform” rating.

“The quarter showcased Heroux’s growing and stable defense vertical, with fiscal year-to-date revenues up 64 per cent from the segment,” he said. “Although, with continued weakness on the Civil side we expect Heroux’s stock to remain range-bound in the near-term while the global aerospace industry works through the monumental challenges that Covid has created.”

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Touting its “top-tier” free cash generation, ATB Capital Markets analyst Tim Monachello raised his rating for Total Energy Services Inc. (TOT-T) to “outperform” from “sector perform,” seeing its North American business lines “showing signs of recovery.”

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“While the North American energy services sector continues to face challenging conditions over the mid-term, it appears that a recovery is underway and TOT is reporting stronger activity levels in Q4/20, which we believe should carry momentum into 2021,” he said. “In its Contract Drilling (CDS) business, TOT currently has 10 rigs running in Canada, and 5 in the U.S. – up from Q3/20 averages of 4 and 1 respectively. We believe the improvements in industry field activity should contribute to improvements in TOT’s other capex-oriented service lines, including rentals (RTS) and, to a lesser extent, Well Servicing (WS). In addition, we understand TOT is cautiously optimistic about improving inquiry levels in its Compression and Process Services (CPS) business line which could lead to improving bookings over the coming quarters. Overall, we believe activity across TOT’s North American platform has likely bottomed and the prospect of improving activity levels now materially outweighs the downside risk, which could provide a catalyst for the stock over the mid-term.”

Mr. Monachello said the Calgary-based diversified energy services supplier has “s demonstrated its ability to reign in costs and drive free cash generation, even before changes in working capital and government grants.” He estimates Total generated $6-million in free cash flow in the third quarter and $2.4-million during the activity downcycle that began in the second quarter.

“Moving forward, we believe improving activity levels, along with TOT’s demonstrably strong internal controls regarding returns, free cash generation – combined with its low cost of debt – are likely to propel continued free cash generation through the recovery,” he said. “We believe TOT’s top-tier free cash generation could drive a positive rerating in the stock through the recovery.”

After increased his earnings expectations for 2020 and 2021, Mr. Monachello increased his target for Total shares to $3.75 from $3.25. The average on the Street is $3.20.

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Fortuna Silver Mines Inc. (FVI-T) is “entering turbulent waters,” according to Canaccord Genuity analyst Dalton Baretto, leading him to downgrade its stock to “hold” from “buy” following the release of its third-quarter financial results.

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“The stock has had an excellent run this year (up 266 per cent since the March 13th low), and the company is now entering a tricky phase in the life of any mining company - the commissioning of a new mine,” he said. “Indeed, management has already highlighted a number of teething pains, and we note that Argentinian COVID-19 restrictions have exacerbated the situation. In addition, we see looming risks at the other flagship mine - San Jose - where we see a mine life through 2024 only, with limited recent exploration success, and an overhanging $30 million question with regard to past royalties due.”

Mr. Baretto said the company’s Lindero mine in Argentina is “facing the usual ramp-up teething pains” after construction was nearly completed during the quarter and following the Oct. 20 announcement of the first gold pour. He said the company’s post-earnings call highlighted several concerns, including restriction of people movement across local and international models, mine access obstacles brought on by social distancing restrictions and multiple conveyor pulley breakdowns.

“We believe further issues will arise as the entire operation ramps up to full capacity and that issues typical of Argentina will arise once the ramp-up is complete (recovery of VAT, repatriation of currency, etc.) – hence our decision to move to the sidelines until all of these issues are resolved,” he said.

Mr. Baretto maintained a $10.50 target for Fortuna shares, which falls 15 cents below the consensus.

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Seeing its free cash flow growth potential remaining “largely muted” through 2021 and seeing an inflection point still several quarters away, Scotia Capital analyst Michael Doumet downgraded Ag Growth International Inc. (AFN-T) to “sector perform” from “sector outperform” on Monday.

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“AGI has debt-funded growth projects for several years, deploying significant capital to expand its global platform, building, expanding, and/ or acquiring businesses across multiple geographies, diversifying profit sources, and seeking growth opportunities,” said Mr. Doumet. "Profits growth has not materialized to the extent we initially expected. While an improvement in farm economics bodes well, an uncertain (and sometimes volatile) macro has made the performance (and outlook) at Commercial tough to call.

“Further, while we like the dividend reduction as it frees up capital, our main pushback has been on the company’s muted FCF generation and elevated B/S leverage – which adds an element of risk to the equity. The silo failure, a risk we still can’t fully handicap, is a headwind to cash generation and deleveraging in the NTM. With the shares up 75 per cent from the 2Q trough, we think the risk/reward is balanced. No turnaround is linear.”

Mr. Doumet reduced his target to $33 from $35. The average on the Street is $39.79.

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After CES Energy Solutions Corp. (CEU-T) reported a third-quarter EBITDA beat in “tough” industry conditions, Industrial Alliance Securities analyst Elias Foscolos raised his rating for its stock to “buy” from “speculative buy,” expressing increased confidence in its outlook.

On Thursday after the bell, the Calgary-based company reported revenue of $166-million, down 47 per cent year-over-year but exceeding Mr. Foscolos’s $157-million forecast. Adjusted cash EBITDA dropped 57 per cent to $18-million, but also topped the analyst’s projection ($7-million).

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“Industry fundamentals have been trending positively in terms of both production and drilling,” said Mr. Foscolos. “CEU has maintained its strong market position in Canada and grown its share of the U.S, market in key basins but has noted significant competitive pressures and pricing concessions across the business.”

“CEU continued to harvest working capital in the quarter, and currently holds a cash balance of $23-million and undrawn credit facilities of $170-million and US$50-million. CEU’s senior notes do not mature until 2024. CEU was careful not to give away too much on the call in regard to its capital strategy, but the sense we get is that the Company will be cautious, focusing on running the business and managing working capital. We do not see CEU stretching the balance sheet to fund any large-scale greenfield or inorganic investments, and believe excess capital will most likely be put toward share buybacks.”

After raising his estimates to account for increased assumptions for U.S. rig counts, market shares and margins, Mr. Foscolos increased his target for CES shares to $1.50 from $1.40. The average is currently $1.53.

“Q3/20 was a solid beat over the high end of consensus estimates on strong margin performance, and was overall a strong quarter in light of challenging industry conditions and competitive pressures,” he said. “As activity recovers, we expect CEU to continue focusing on operational execution, outlasting competitors, and working capital management, with upside to deploy excess capital to repurchase shares. We have increased our estimates, resulting in an upward target price revision.”

Elsewhere, ATB Capital Markets analyst Tim Monachello upgraded CES to “outperform” from “sector perform” with a $1.60 target, up from $1.40.

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Though Computer Modelling Group Ltd. (CMG-T) reported “robust” headline second-quarter results amid “diminished expectations,” Canaccord Genuity analyst Doug Taylor sees its end-markets facing ongoing challenges.

Wanting to see further signs of “stabilization,” he lowered his rating for Calgary-based company, which produces reservoir simulation software for the oil and gas industry, to “hold” from “buy.”

On Friday before the bell, CMG reported revenue of $17.9-million, down 10 per cent year-over-year but above the projection of both Mr. Taylor ($17.2-million) and the Street ($16.8-million). Adjusted EBITDA of $10.9-million (or $8.4-million excluding wage subsidies) and earnings per share of 8 cents also topped the analyst’s estimates ($8.3-million and 6 cents) and the consensus ($7.9-million and 6 cents).

“Despite oil prices stabilizing in recent months, industry bellwethers are seeing customers shift toward maintenance mode on their operations, with limited capital spend as supply remains high and demand uncertainties persist and dynamics further complicated by the spike in COVID cases in recent weeks,” said Mr. Taylor.

Citing updated management commentary as well as “the continued uncertainties and cost preservation efforts being undertaken by global energy companies, and continued weak fundamental leading indicators,” Mr. Taylor raised his EPS projection for 2021 to 24 cents from 22 cents, however he lowered his 2022 expectation to 25 cents from 27 cents.

His target for CMG shares declined by a loonie to $5. The average on the Street is $5.29.

“CMG reported September Q2 headline results that were above estimates on the strength of a better perpetual license performance,” he said. “Shares traded up 1 per cent on Friday after the results. However, looking past the headline numbers, the challenging endmarket fundamentals are beginning to manifest in the form of accelerating year-over-year declines in the recurring revenue base (down 14 per cent year-over-year in Q2) and deferred revenue (down 18 per cent). Given this revenue base is the key valuation driver, we prefer to see stabilization and, ultimately, growth in these numbers before recommending investors try to take advantage of what is an historically low valuation. As such, we are moving our rating to HOLD pending signs of improvement in key metrics and are reducing our target.”

“CMG boasts strong competitive positioning and margins. However, the stock continues to hover at historic low valuations (10.1 times NTM EBITDA and 19.7 times P/E), which we believe could persist given significant challenges facing the company’s end-market.”

Meanwhile, Industrial Alliance Securities' Elias Foscolos trimmed his target to $6 from $6.25, keeping a “speculative buy” rating.

“When we adjust for one-time items, at their core, CMG’s Q2/F21 financial results constitute a beat,” said Mr. Foscolos. “While the results were skewed because of one-time CEWS costs and Perpetual sales, we see a beat in Maintenance and Annuity sales, and it appears that the revenue decline in those categories is behind us. We believe CMG’s dividend is sustainable. Our upwardly revised forecasts are tempered by lower valuation metrics.”

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AutoCanada Inc. (ACQ-T) is “firing on all cylinders,” said Canaccord Genuity analyst Luke Hannan following the release of “significantly better than expected” quarterly results.

The Edmonton-based company reported revenue of $1.02-billion, which was in line with consensus, however adjusted EBITDA of $61-million (including a $6.3-million benefit from the Canada Emergency Wage Subsidy) blew past both Mr. Hannan’s forecast and the consensus estimate ($37-million and $34-million, respectively).

“For the seventh straight quarter, AutoCanada continued to outperform the Canadian new car market, seeing 3.4-per-cent unit growth year-over-year during the period while the market declined 4.3 per cent, while also delivering five consecutive quarters of EBITDA margin improvement at its U.S. operations,” said Mr. Hannan. “On a consolidated basis, the company saw 17.9-per-cent growth in used car sales, attributable to pent up demand from Q2/20 where dealerships were closed, driving year-over-year margin improvement in the segment of 5.1 percentage points. Higher used car volumes increased AutoCanada’s used-to-new ratio to 0.86, from 0.72 last year.”

Mr. Hannan raised his 2021 EPS estimate to “reflect higher margins in the used car business, as well as lowered our SG&A (excl. depreciation) as a percentage of gross profit to reflect improving cost control.”

That led him to hike his target for AutoCanada shares to $32 from $22 with a “buy” rating. The average is $29.36.

“We believe the realignment of AutoCanada’s business following the implementation of the Go Forward Plan to focus on developing the higher-margin and economically resilient operating segments, combined with the company’s digital retail strategy, will reward investors with stable earnings growth,” he said.

Others raising their targets include:

* Scotia Capital’s Michael Doumet to $32.50 from $24 with a “sector outperform” rating

“Following our upward revisions, ACQ shares have gotten ‘cheaper’, despite the 10-per-cent move in the share price,” Mr. Doumet said. “ACQ shares trade at 6.6 times EV/EBITDA on our 2021 estimates, reflecting a 20-per-cent discount to the peer group. Further, we believe the risk is to the upside as we assume a steeper margin moderation through 2021 than that implied by consensus for U.S. peers.”

* CIBC’s Matt Bank to $27 from $22 with a “neutral” rating

* Acumen Capital’s Trevor Reynolds to $32 from $26.50 with a “buy” rating

* RBC’s Steve Arthur to $30 from $24 with an “outperform” rating

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Though he said Crombie REIT’s (CRR.UN-T) portfolio continued to generate solid operating results during the third-quarter, Canaccord Genuity analyst Mark Rothschild thinks that performance is now largely reflected in its unit price.

Accordingly, he downgraded the New Glasgow, Nova Scotia-based REIT, which relies heavily from its long-term leases with Sobeys, on Monday to “hold” from “buy.”

“While one-time items related to COVID-19 impacted the REIT’s financial results in the quarter, the magnitude was smaller than in Q2/20,” he said. “Longer term, our outlook for the REIT remains positive, and we expect steady same-property NOI growth driven by contractual rent escalations. In addition, over the next year, Crombie is scheduled to complete all its active development projects, which should drive additional growth in NAV and cash flow per unit.”

Mr. Rothschild raised his target to $15 from $14.50. The average on the Street is $15.09.

“Crombie’s units have delivered a year-to-date total return of negative 3.5 per cent, outperforming retail peers which have returned, on average, negative 12.2 per cent,” he said. “Following Q3/20 results, which were ahead of our expectations, our updated NAV estimate is now $14.93 per unit (previously $14.71) and our target price, which is set in line with NAV, is now $15.00 (from $14.50). Reflecting a more modest forecast total return of 9.2 per cent, we are reducing our rating.”

Other analysts adjusting their targets included:

* RBC’s Pammi Bir to $15 from $14.50 with a “sector perform” rating

* CIBC’s Dean Wilkinson to $15.75 from $14.50 with an “outperformer” rating

* National Bank’s Tal Woolley to $16.50 from $15.50 with an “outperform” rating.

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Seeing capital constraints and other balance sheet concerns overshadowing its “promising” operations, Canaccord Genuity analyst Shann Mir initiated coverage of Calgary-based cannabis producer Sundial Growers Inc. (SNDL-Q) with a “hold” rating on Monday.

“Sundial has historically secured a 5-per-cent national market share within the Canadian adult-use space as a result of focusing efforts on the inhalables subcategory (vape, flower, pre-roll, concentrate),” he said. “The company has 470,000 sq. ft. of facility space, employing a modular format with 126 unique grow rooms, that have access to 98 per cent of the addressable Canadian market. Although the company’s ability to secure a top-10 market share within the space is encouraging, we believe that uncertainties around SNDL’s capital position and cost structure may strain resources as it continues to scale its operation, and we would therefore caution investors to remain on the sidelines until there is more clarity on the capital structure.”

Mr. Mir set a target of 30 US cents, matching the average on the Street.

“After initial hiccups experienced as the company first broke into the Canadian recreational market, it has undergone several strategic revisions that have resulted in operational and market share improvements that we believe have yet to be rewarded by investors,” he said. “The company has seen sizeable quarter-over-quarter increases in its adult-use penetration (the metric we find most compelling when evaluating LPs) due to its more recent strategic rationalizations in a period where many of its competitors have seen stagnant or declining market penetration. However, the stock has sold off in tandem with the broader cannabis industry , also reflecting concerns with the company’s balance sheet and its ability to service its debt while investing in its operations (along with more macro-related trends). Should the company identify methods to address its current capital structure adequately, we believe the core operations of the business will warrant a valuation re-rating and could present potential upside.”

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In other analyst actions:

* BMO Nesbitt Burns analyst Peter Sklar downgraded George Weston Ltd. (WN-T) to “market perform” from “outperform” with a $107 target, down from $125 and below the $120.67 average.

“We forecast Weston’s largest holding, Loblaw, will only be able to generate modest EBITDA growth in future quarters as COVID-19 costs continue to depress strong sales growth,” said Mr. Sklar.

“As well, with the prospect of vaccines becoming available in 2021, we believe investors will be less focused on the stability offered by grocery stocks such as Loblaw and its parent company, George Weston."

* BMO’s Jackie Przybylowski raised Yamana Gold Inc. (AUY-N, AUY-T) to “outperform” from “market perform” with a US$9 target, up from US$8.25. The average is US$7.95.

“We are upgrading Yamana .... because of relative valuation, including for expected positive near-term catalysts, as our thinking about the company’s capital allocation strategy has evolved favourably, and as the result of changes to our target multiples and our target price and the corresponding improvement to valuation relative to other precious metals miners in our coverage universe,” she said.

* BMO’s Tim Casey upgraded Cineplex Inc. (CGX-T) to “market perform” from “underperform” with a $7 target The average is $11.38.

“Q3 results were weak given current industry challenges, as expected,” he said. The more interesting development is the announcement of a new credit agreement which, in our view, provides financial flexibility through mid-21. Moreover, encouraging developments regarding vaccines provide incremental optimism that consumers will return to theatres next year."

“We think a ‘return to normal’ scenario carries a much longer time frame but acknowledge that the likelihood of a value-destroying liquidity event has been reduced. As such, we are upgrading our rating.”

* Seeing its stock as overvalued even after relinquishing a portion of its post-U.S. election gains, Jefferies analyst Owen Bennett lowered Aurora Cannabis Inc. (ACB-T) to “underperform” from “hold” with a target of $4.93, down from $6.90 and below the $10.51 average.

* Mr. Bennett raised his target for Canopy Growth Corp. (WEED-T, “hold”) to $27.78 from $20.20 and lowered his target for Cronos Group Inc. (CRON-T, “underperform”) to $5 from $5.60. The average targets are $26.35 and $8.83, respectively.

* RBC Dominion Securities analyst Geoffrey Kwan cut his target for Sprott Inc. (SII-T, “sector perform”) shares to $47 from $54, while Desjardins' Securities' Gary Ho raised his target to US$34 from US$33 with a “hold” rating. The average is $46.89.

“Looking ahead, we think the current macro environment remains supportive of SII’s high exposure to gold," said Mr. Kwan. “We view the shares as having attractive defensive attributes with optionality for valuation upside to the extent that gold and precious metal prices continue to increase. On the flip side, we think the key risk to the stock is a material decline in gold prices, which would have a disproportionate negative valuation impact to SII relative to other stocks within our coverage. Our Sector Perform rating reflects our view that the risk-reward is slightly more balanced as gold prices have fallen off their recent highs and recent positive news on a COVID-19 vaccine could potentially temper some of the positive momentum gold has experienced so far this year.”

* Mr. Kwan raised his target for Onex Corp. (ONEX-T, “outperform”) to $85 from $79, while Canaccord Genuity’s Scott Chan increased his target to $84 from $83 with a “buy” rating. The average is $85.90.

“Currently, ONEX shares trade attractively at a 29-per-cent discount to hard NAV, while getting the company’s growing Asset & Wealth Management business for free,” said Mr. Chan.

* RBC’s Matt Logan raised his target for Automotive Properties REIT (APR.UN-T) to $11.50 from $11 with a “sector perform” rating, while CIBC’s Chris Couprie increased his target to $11 from $10.50 with an “outpeformer” recommendation. Desjardins Securities' Kyle Stanley increased his target to $11.25 from $10.50 with a “buy” rating. The average is $11.25.

“As operations normalize, the benefits of the long-term, net-lease structure are displayed, with largely unaffected rent collections and contractual growth driving healthy same-property performance,” said Mr. Stanley. “Moreover, APR is well-positioned to take advantage of external growth opportunities with $150-million of acquisition capacity.”

* CIBC analyst Mark Jarvi increased his target for Algonquin Power & Utilities Corp. (AQN-T) to $17 from $16 with an “outperformer” rating, while National Bank’s Rupert Merer moved his target to $16.50 from $15.75 with an “outperform” recommendation. RBC’s Nelson Ng raised his target to US$17 from US$15 with an “outperform” rating. The average is $15.89.

“We believe the shares of Algonquin offer a good balance of growth, income, and exposure to renewables,” said Mr. Ng. “At its upcoming investor day, we expect the company to refresh its 5-year growth trajectory, which historically has been 10-per-cent-plus EPS growth without new acquisitions.”

* CIBC’s Jacob Bout trimmed his target for Chemtrade Logistics Income Fund (CHE.UN-T) to $6 from $6.75 with a “neutral” rating, while National Bank’s Endri Leno lowered his target to $5.50 from $6.25 with a “sector perform” recommendation. Scotia Capital’s Ben Isaacson trimmed his target to $6 from $7, keeping a “sector perform” rating. The average is $6.83.

“We don’t see a clear path to recovery for Chemtrade near-term, as we think market and operational headwinds will persist into the new year,” said Mr. Isaacson. “First, we don’t see meaningful improvements anytime soon for the company’s key end markets, particularly in Pulp & Paper, and especially as more restrictive lockdowns in Canada and the U.S. are likely to be re-instated. Second, even if we’re wrong, CHE may not be in the best position to take advantage of it. The reduced North Vancouver utilization rate is a key concern, as reduced HCl demand, and with it, fewer ways to consume / place chlorine from the chlor-alkali process, is limiting the company’s ability to operate its plant fully. Given more weakness expected in fracking (the primary end-market for HCl), we are wary that operating rates may disappoint near-term. Third, we expect SPPC demand to remain below pre-pandemic levels through most of 2021.”

* RBC’s Walter Spracklin raised his target for shares of Exchange Income Corp. (EIF-T) to $40 from $36 with an “outperform” rating, while CIBC’s Scott Fromson hiked his target to $37.50 from $35.50 with a “neutral” rating. The average is $40.35.

* Mr. Spracklin also raised his target for CCL Industries Inc. (CCL.B-T) to $67 from $63 with an “outperform” rating, while Mr. Fromson increased his target to $70 from $55 with an “outperformer” rating. Raymond James’ Michael Glen moved his target to $65 from $57 with an “outperform” rating. All three exceed the consensus of $61.56.

“With the reporting of the 3Q20, we are moving our estimates higher to reflect trends in the business coupled with a relatively constructive tone during the conference call,” said Mr. Glen. "From that perspective, even with these positive revisions we still see opportunities for further positive adjustments as we think about the eventual rebound in certain portions of the Checkpoint, Avery and Label segments. It is interesting to note that pre-COVID we would have a number of conversations with investors regarding the cyclicality of CCL’s business, particularly in comparison to the financial crisis (i.e. given how the business has evolved since the financial crisis how would it perform in a downturn). While clearly this downturn is/was quite different vs. the financial crisis, we have been very surprised just how well CCL’s operations have performed, with the company now on pace to exceed 2019 EPS and FCF this year. This is not an outcome we would have even thought was possible at the onset of the pandemic, and we do not believe investors are giving the stock enough credit for this outcome.

“Looking forward, CCL described a continuation of solid trends into October, but at the same time acknowledged emerging headwinds related to stricter COVID measures through the winter. While this may be the case, we see a company with a very strong balance sheet (1.5x net debt / EBITDA), strong recurring free-cash generation, and strong longer-term outlook. As such, we remain constructive on the stock.”

* National Bank’s Tal Woolley raised his target for SmartCentres REIT (SRU.UN-T, “sector perform”) to $26 from $23. The average is $26.31.

* National Bank’s Matt Kornack increased his target for Storagevault Canada Inc. (SVI-X) to $4.50 from $3.75 with an “outperform” rating. The average is $4.18.

* CIBC’s Chris Couprie bumped his target for Extendicare Inc. (EXE-T) to $7.25 from $7 with a “neutral” rating. The average is currently $6.96.

* Desjardins Securities' Michael Markidis bumped his target for Boardwalk Real Estate Investment Trust (BEI.UN-T) to $40 from $38 with a “buy” rating. National Bank’s Matt Kornack raised his target to $42 from $40 with an “outperform” rating, while Canaccord Genuity’s Brendon Abrams moved his target to $34 from $29 with a “hold” rating. The average is $40.13.

* Desjardins’ Benoit Poirier raised his target for Uni-Select Inc. (UNS-T) shares to $13 from $9 with a “buy” rating, while National Bank Financial’s Zachary Evershed bumped his target to $8 from $7.50 with a “sector perform” recommendation. The average is $10.90.

“In 3Q, UNS again reported solid results and further improved its balance sheet,” Mr. Poirier said. “Management expects a softer 4Q given normal seasonality patterns and the volatile market conditions brought on by the second wave of COVID-19. We believe the efforts undertaken to strengthen the business, such as the Continuous Improvement Plan and refinancing, better position the company to weather the second wave.”

* Raymond James analyst Craig Stanley initiated coverage of Montage Gold Corp. (MAU-X) with a “strong buy” rating and $2 target.

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Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

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