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

Following a “strong” third-quarter earnings beat and seeing industry activity continuing to “trend in the right direction,” iA Capital Markets analyst Elias Foscolos raised CES Energy Solutions Corp. (CEU-T) to “buy” from “speculative buy” on Monday.

“CEU delivered its fifth consecutive quarter with adjusted EBITDAC [cash earnings before interest, taxes, interest, depreciation, amortization and coronavirus] beating the high end of consensus estimates,” he said. “Commentary on the call was bullish on the medium-term outlook for North American oilfield activity, which aligns with our view that drilling activity will continue to trend positively. We are increasing our estimates and target price, and with the strong results and commentary alleviating some of our concerns over supply chain constraints, we are upgrading our rating.”

Last week, the Calgary-based company reported revenue of $314-million, up 89 per cent year-over-year and above Mr. Foscolos’s $275-million estimate. Adjusted EBITDAC rose 131 per cent to $42-million, also topping the analyst’s projection ($32-million).

“CEU’s quarterly revenue was well above estimates at pre-pandemic levels on recovery in both drilling and production activity, growing market share in U.S. production chemicals, and pricing increases seeking to offset higher raw materials costs,” said Mr. Foscolos. “Canadian rig counts have strengthened considerably and are now above pre-pandemic levels, while U.S. rig counts continued their steady upward trend, with Permian rig counts (where CEU has the leading share with 27 per cent) approximately doubling over Q3 last year and continuing to trend positively. Additionally, Permian oil production has recovered to pre-pandemic levels. We believe industry activity will continue to trend positively going forward.

“Cash gross margins experienced some expected pressure, but costs were managed effectively overall and Adj. EBITDAC margins were solid. CEU’s commentary indicates that it has generally had success passing on higher costs to customers through pricing increases, but we expect there will be some short-term pressure due to the time lag for pricing changes to take effect. CEU actively made strategic investments in working capital during the quarter to mitigate supply chain risk, resulting in a draw on the credit facility. CEU’s ability to use its balance sheet to strategically manage working capital should position the Company to meet growing customer demand in a constrained supply environment.”

After raising his revenue estimates for both it Canadian and U.S. operations through 2022, Mr. Foscolos increased his target for CES shares to $3.10 from $2.80. The average is $3.24.

Elsewhere, BMO’s John Gibson raised his target to $3 from $2.75 with an “outperform” rating.

“CES reported another strong quarterly beat, driven by stable market share in its drilling fluids (DF) business, and continued momentum (and market share growth) in production chemicals,” said Mr. Gibson. “Post the quarter we are increasing our estimates along with our target price to $3.00 ($2.75 prior) and reiterating our Outperform rating. As we move into 2022, we expect this strong performance to continue, particularly as access to the company’s products becomes more scarce, which could drive pricing and market share higher.”


Expecting labour and inflation challenges to weigh on near-term performance, Desjardins Securities analyst Frederic Tremblay lowered Lassonde Industries Inc. (LAS.A-T) to “hold” from “buy” following weaker-than-expected third-quarter results.

“Although demand remains healthy, sales and margins are negatively impacted by labour scarcity issues, especially in the U.S.. A tough environment, which is also characterized by elevated input costs, is expected to persist for a few quarters despite efforts to adjust prices.

On Friday, the Rougemont, Que.-based juice producer reported sales of $469.3-million, down 5.2 per cent year-over-year and below Mr. Tremblay’s $483.9-million estimate. Adjusted earnings before interest, taxes, depreciation and amortization of $40.5-million also missed his forecast ($48-million) as margins declined.

“The company’s ability to fully meet demand is constrained by labour scarcity (and related productivity issues), especially in certain parts of the U.S.,” the analyst said.

“Inflationary pressures are coming from multiple sources, including ingredients, packaging and freight. Selling price increases realized in 2Q and 3Q have not been sufficient to fully offset the higher costs. Lassonde is therefore looking at various internal initiatives and intends to implement additional price increases over the coming months to offset inflation.”

After reducing his full-year 2021 and 2022 revenue and earnings projections, Mr. Tremblay cut his target for Lassonde shares to $180 from $220. The average on the Street is $185.

“Our change of recommendation mainly stems from: (1) our expectation that supply chain and inflation challenges will persist over the coming quarters; (2) with Lassonde being heavily focused on navigating the current challenging environment, we believe that the possibility of a strategic acquisition in the near term has been reduced; and (3) we do not expect LAS.A’s valuation multiples to expand meaningfully until sustainable margin improvement occurs,” he said.


Touting an “attractive entry point for [a] quality seniors housing portfolio,” Canaccord Genuity analyst Christopher Koutsikaloudis upgraded Chartwell Retirement Residences (CSH.UN-T) to “buy” from “hold” despite the release of weaker-than-expected third-quarter results.

After the bell on Thursday, the Mississauga-based REIT reported funds from operations of 15 cents per diluted unit, down 13 per cent year-over-year and 2 cents lower than the consensus forecast on the Street. The miss was due largely to a $4.2-million decrease in same-property net operating come and dilution from a recent $201-million equity issuance.

However, Mr. Koutsikaloudis sees signs of a stabilization in its operating performance, noting retirement occupancy was steady sequentially at 76.6 per cent.

“Management of Chartwell is forecasting that occupancy rates will hold stable through the remainder of 2021 before starting to recover in 2022,” he said. “Importantly, there has been positive momentum in Chartwell’s leading indicators for resident demand, with initial contacts from prospective residents up 35 per cent sequentially and personalized tours up 55 per cent sequentially in Q3/21.

“In our view, several factors should drive a recovery in occupancy for Chartwell over the next year, including: pent-up demand from seniors that delayed decisions to move into retirement residences during the pandemic; the population aged 75 or older in Chartwell’s markets is expected to grow by 5 per cent in 2022; and, tighter overall market conditions as construction starts for seniors housing have declined since the beginning of 2020 and there will be less competition.”

He maintained a target of $13.25 per unit. The average on the Street is $14.21.

“Over the past three months, Chartwell’s unit price has declined 12 per cent, and we now believe the units offer an attractive risk-reward opportunity for investors,” said Mr. Koutsikaloudis. “Combined with a 5.2-per-cent distribution yield, our target price implies a total return of 17.6 per cent over the next 12 months.

“While we acknowledge that the timing of the recovery in occupancy and margins for Chartwell remains uncertain, recent seniors housing transactions in Canada would suggest that property values are consistent with pre-pandemic levels. We are therefore upgrading our rating for Chartwell.”

Elsewhere, CIBC’s Scott Fromson lowered his target for to $14.25 from $14.50 with an “outperformer” rating.


After a “surprisingly quiet” quarter, iA Capital Markets analyst Frédéric Blondeau lowered his recommendation for Automotive Properties Real Estate Investment Trust (APR.UN-T) to “hold” from “buy” based on valuation concerns.

On Thursday after the bell, the Toronto-based REIT reported third-quarter funds from operations of 23.4 cents per unit, falling slightly below Mr. Blondeau’s 24.5-cent estimate but in line with the consensus projection of 24 cents. Net operating income and NOI margin both also narrowly missed his expectations.

“Although it is relatively challenging to assess the impact of inflationary pressures on APR’s financial performance, we believe this specific type of risk could become more significant within the next 6-18 months given the present context,” he said. “On this subject, we would further underline that 4.3 per cent, 3.7 per cent, 2.7 per cent, and 4.8 per cent of APR’s cash NOI comes to maturity in 2026, 2027, 2028, and 2029, respectively, before moving back up around the 10%-mark starting in 2030.”

Mr. Blondeau said he’s no longer expect the REIT to acquire properties during the remainder of 2021, and projects acquisitions worth $75-million in 2022.

He maintained a $13.50 target for units of the REIT. The average is $14.02.

Elsewhere, Desjardins Securities analyst Kyle Stanley downgraded the REIT to “hold” from “buy” with a $13.75 target, up from $13.50.

“We appreciate APR’s stable cash flow profile and above-average (5.9-perc-ent) distribution yield; however, we believe the stock is unlikely to outperform over the next 12–18 months given (1) limited opportunities to enhance its relatively modest organic growth, and (2) limited visibility with respect to external growth opportunities,” said Mr. Stanley. “With the stock trading at a 12.5-per-cent premium to NAV, we do not believe that multiple expansion can drive outperformance vs peers.”

Other analysts making target changes include:

* BMO’s Joanne Chen to $14.25 to $13.20 with an “outperform” rating.

“Following another steady and predicable Q3/21, our positive outlook on Automotive Properties REIT is unchanged. We remain reassured by the stability of the retail automotive dealership industry and APR.UN’s predictable cash flow stability amidst the ongoing recovery. Ongoing cap-rate compression also speaks to the resiliency of the sector,” said Ms. Chen.

* CIBC’s Scott Fromson to $14.75 from $14.25 with an “outperformer” rating.

“APR posted Q3/21 results that came in a bit below our estimates and consensus. Still, the stability and predictability of APR’s automotive dealership RE leasing business model remain intact; IFRS fair value went up 45 cents per unit on cap rate compression. APR has highly visible cash flows, a 6-per-cent yield and external growth optionality. Acquisition activity has been muted since the onset of the pandemic due to a lack of dealership trading activity and higher valuations; the REIT expects a recovery in transaction volumes as early as H1/22,” said Mr. Fromson.

* Raymond James analyst Brad Sturges to $14.25 from $13.50 with an “outperform” rating.

* TD Securities’ Jonathan Kelcher to $15.50 from $14 with a “buy” rating.


Citing “continued operating challenges and a strained balance sheet,” Desjardins Securities analyst John Sclodnick cut Pure Gold Mining Inc. (PGM-X) to “sell” from “hold,” seeing it in a “perilous” financial state.

“We are downgrading Pure Gold to Sell after the company reported 3Q results with negative working capital, a suspension in reporting costs per ounce and the retirement of the vice-president of operations following the recent retirement of the mine’s general manager,” he said. “Overall, the operational turnaround is losing momentum. With the cash balance declining to $12.5-million from the $24.3-million reported in 3Q, we do not believe the current upside potential from an operational turnaround justifies the near-term risks.”

Mr. Sclodnick says the sudden retirement of Vice-President of Operations Ken Donne and two other top operational managers “does not instill confidence in the operational turnaround.” He added: “Compounding our waning confidence is the decision to suspend disclosure of cash cost and AISC metrics. Management anticipates providing these figures again in 1Q22.”

“The company ended 3Q with $24.3-million in cash and negative working capital of $2.7-million,” the analyst said. “Subsequent to quarter-end, it closed a $3.5-million financing on the same terms as the $23.0-million financing in September ($1.05 per unit with a halfwarrant), but disclosed that the cash balance was at $12.5-million as of the MD&A released on November 12, a perilously low level. Given the lowered operational guidance previously set for 4Q (we model the mid-point of 4Q guidance at 11koz), we expect the company to look for external financing,” he added.

With reductions to his financial and operational estimates, Mr. Sclodnick cut his target for Pure Gold shares to $1.20 from $1.60. The average is $1.65.

“We had previously upgraded Pure Gold to Buy (from Hold) on September 28 after the company completed a financing and it appeared that operations were turning a corner,” he said. “The stock was trading at $0.85 and 0.45 times NAV. With the stock now at $1.08 and 0.63 times NAV, we believe that investors can find better risk-adjusted returns until the company can gain a more secure footing.”


Raymond James analyst Rahul Sarugaser said it will “take some time” for him to reestablish confidence in Avicanna Inc.’s (AVCN-T) revenue growth.

Accordingly, he lowered his rating for the Toronto-based pharmaceutical company, which focuses on cannabinoid-based products, by two levels to “underperform” from “outperform.”

“On account of auditor challenges that caused the late filing of its 2020 annual financials, Avicanna Inc. (stock ceased trading from Apr. to Aug. 2021,” he said. “We have not published research since Dec. 2020, around the time of this company’s most recent on-time filing (3Q20). In Sep. 2021, AVCN managed to publish its 4Q20, 1Q21, and 2Q21 financials, and, [Friday] morning, AVCN filed its 3Q21 financials for the period ended Sep. 30, revealing escalations in revenue—mainly from Canadian adult-use and medical cannabis sales—but diminishing gross margins.”

Mr. Sarugaser said he sees Avicanna “resetting itself to drive momentum in its sales organization,” noticing “seeds of this momentum in AVCN’s 25-per-cent quarter-over-quarter revenue escalation into 3Q21, and the preceding 167-per-cent quarter-over-quarter revenue escalation into 2Q21.”

“Seeing this company hit its first $1.0-million revenue quarter is, in our eyes, a major milestone,” he added. “While clinical development is a key part of this company’s DNA—and, indeed, clinical development initiatives are proceeding in LATAM and Canada — we see AVCN evolving into an international sales organization, and view this positively.

“We believe AVCN’s sources of durable revenue moving forward are, principally, from its sales into Canada’s adult-use and medical cannabis markets (RHO Phyto, Pura Earth/H&W, Viola-brand products, royalties from AVCN-powered Heritage Cannabis products [CANN-CN, not covered]), as well as its royalty-bearing license agreements for product sales in the U.S. (re +PLAY brand sales via Harrington Wellness (private); Pura H&W product sales via Red White and Bloom [RWB-CN, not covered]).”

Though he sees “lots of activity and promise,” Mr. Sarugaser, currently the lone analyst publicly covering the stock, reduced his target for Avicanna shares to 70 cents from $2.50.


In other analyst actions:

* After a third-quarter earnings miss, Canaccord Genuity analyst Kevin MacKenzie downgraded Pretium Resources Inc. (PVG-T) to “hold” from “buy” with an $18.50 average. The average is $18.08.

* Veritas Research analyst Kathleen Wong upgraded Canadian Tire Corp. Ltd. (CTC.A-T) to “reduce” from “sell” with a $185 target. The average target on the Street is $225.73.

* RBC’s Matt Logan increased his Boardwalk Real Estate Investment Trust (BEI.UN-T) target to $63 from $54 with an “outperform” rating. Others making changes include: BMO’s Joanne Chen to $57.50 from $51 with an “outperform” rating; TD Securities’ Jonathan Kelcher to $25 from $24 with an “action list buy” rating; Desjardins Securities’ Michael Markidis to $62 from $55 with a “buy” rating; Canaccord Genuity’s Mark Rothschild to $58 from $50 with a “hold” rating and CIBC’s Dean Wilkinson to $57 from $53 with a “neutral” rating. The average is $58.14.

“Boardwalk REIT’s operating results continue to demonstrate positive momentum on many fronts,” said Mr. Logan. “The top-line is growing, cost control remains disciplined, and the macro backdrop continues to improve. Taking a step back, we’re most encouraged by accelerating migration into the province and what appears to be structural improvements in economic diversification. These factors, together with an unregulated rental market and affordable portfolio, underpin our continued confidence in a robust 2022–23 outlook.”

* Mr. Logan also raised his BSR REIT (HOM.U-T, HOM.UN-T) target to US$21 from US$17 with an “outperform” rating. The average is US$19.46.

“While real estate track-records often take 5–10 years to build, we think BSR REIT is well on its way to becoming a preeminent small cap REIT,” he said. “In the 3.5 years BSR has been public, we believe its record clearly demonstrates an ability to: 1) deliver outsized SP-NOI and NAVPU growth; 2)recycle significant amounts of capital into faster moving streams; and, 3) build an aligned corporate culture that delivers. While the story isn’t finished, the outlook today is brighter than ever. We reiterate our high conviction Outperform rating.”

* CIBC’s Hamir Patel lowered his target for CCL Industries Inc. (CCL.B-T) target to $80 from $82, below the $81.11 average, with an “outperformer” rating.

“We believe CCL’s diversified platform and end-market exposure support steady revenues over the cycle, with potential for greater organic growth as the global economy recovers, and significant flexibility to consider larger M&A opportunities in 2022 as the company’s ability to conduct global due diligence improves further (Asia still a challenge). We are forecasting organic growth of 10.6 per cent in 2021 (vs. 3.9-per-cent decline last year), with further annual gains in 2022/2023 of 2.4 per cent/1.9 per cent,” said Mr. Patel.

* Canaccord Genuity’s Aravinda Galappatthige raised his Cineplex Inc. (CGX-T) target to $15 from $12.50 with a “hold” rating. The average is $16.79.

* CIBC’s Robert Bek cut his Cogeco Inc. (CGO-T) target to $105 from $114 with a “neutral” rating. The average is $122.50.

“While the return to our price target is attractive and implies a material upside, we remain focused on the ownership of CCA shares directly. Given liquidity constraints at CGO, and unknowns around CCA strategy on wireless in Canada, we believe the valuation opportunity is best explored through the more liquid CCA shares at this point in time,” said Mr. Bek.

* Mr. Bek lowered his target for Cogeco Communications Inc. (CCA-T) to $126 from $131, below the $130.20 average, with an “outperformer” rating, while Desjardins Securities’ Jerome Dubreuil cut his target to $125 from $128 with a “hold” rating and BMO’s Tim Casey reduced his target to $125 from $130 with a “market perform” rating.

“CCA reported 4Q FY21 results which were overall in line with expectations,” said Mr. Dubreuil. “FY22 guidance was a touch below expectations as the company should start reaping the benefits of its accelerated capex program only in FY23. In addition to cooperating with governments in Canada to deploy broadband in under-served areas, the company also appears to be in ‘land-grab mode’ in the U.S. as it is organically deploying networks at a much faster pace than in the past.”

* Berenberg initiated coverage of Converge Technology Solutions Corp. (CTS-T) with a “buy” rating and $18.25 target, exceeding the $13.39 average, while Canaccord’s Robert Young cut his target by $1 to $13 also with a “buy” rating.

“Converge’s Q3 was mixed with several moving parts that impacted EBITDA margins and obscured managed services growth. Hardware VAR revenue was impacted by supply chain constraints, particularly within its REDNET, Dasher and Vicom businesses driven by end point devices and HPE/Cisco lead times. Converge also noted lower-margin hardware mix in the quarter. REDNET in Germany felt the impact of PC/notebook shortages leading to underutilized services delivery. All of the above factors compounded recent M&A activity, which added lower margin VAR revenue and drove EBITDA margin of 5.1% below our/Street’s estimates. That said, management noted resilient demand and a material increase in its product order backlog (up $200-millon year-over-year), which shifts some volume into Q4 and 2022. We expect headwinds on EBITDA are temporary and encourage investors to look through the Q3 EBITDA miss. That said, we expect supply chain challenge to remain a factor in the near term, which has led us to reduce our estimates,” said Mr. Young.

* RBC’s Pammi Bir raised his CT Real Estate Investment Trust (CRT.UN-T) target to $18.50 from $18 with a “sector perform” rating. The average is $18.82.

“On the back of in-line Q3 results, our outlook for CRT continues to improve. On fundamentals, no surprises here with our healthy organic growth outlook intact. As well, the defensive strengths inherent in its Canadian Tire-anchored portfolio and strong balance sheet have enabled Management to spend more time in the offensive zone, with acquisitions accelerating, particularly from third parties. At current levels, we believe its premium valuation is well-supported,” said Mr. Bir.

* Canaccord Genuity’s Dalton Baretto raised his Dundee Precious Metals Inc. (DPM-T) target to $11 from $10 with an “outperform” rating. The average is $12.53.

“We like the company for its operating prowess, low cost structure, strong balance sheet and attractive valuation. We point to the shares’ 16-per-cent FCF yield for 2022, and we continue to believe that the company is under-owned relative to peers,” said Mr. Baretto.

* RBC’s Walter Spracklin bumped up his Exchange Income Corp. (EIF-T) target to $52 from $47 with an “outperform” rating. Others making changes include: Canaccord’s Matthew Lee to $53 from $50 with a “buy” rating; iA Capital Markets’ Matthew Weekes to $50 from $48 with a “buy” rating; CIBC’s Kevin Chiang to $49 from $45 with a “neutral” rating and National Bank’s Cameron Doerksen to $51 from $47 with an “outperform” rating. The average is $51.82.

“EIF reported strong Q3/21 earnings last week. Adj. EBITDA of $95M was a quarterly record, beating estimates on the back of strong revenues from the Company’s A&A segment, which experienced tailwinds for its services across the board. While we do not necessarily expect all of these tailwinds to continue into 2022, we believe that the quarter reinforces our outlook for strong near-term growth,” said Mr. Weekes.

* RBC’s Pammi Bir moved his target for shares of Extendicare Inc. (EXE-T) to $8 from $8.50 with a “sector perform” rating. The average is $8.13.

“Post another shortfall in Extendicare’s quarterly earnings, we are modestly curbing our outlook. Results in long-term care continue to exhibit significant volatility, predominantly from pandemic related expenses and recoveries. That being said, we’re encouraged by operational advances being made in the segment, along with net pandemic costs anticipated to gradually fade. As well, traction forming in ParaMed should provide a decent tailwind for growth. Netnet, as the rehab process continues, we maintain our Sector Perform rating,” he said.

* RBC’s Mark Dwelle raised his target for Fairfax India Holdings Corp. (FIH.U-T) to US$18 from US$16 with an “outperform” rating. The average is US$19.25.

“Fairfax India’s investment unit values have bounced back significantly over the past few quarters reflecting an improved economic outlook as India moves past the worst of the pandemic. Vaccination rates for India remain well below many other countries but progress is being made. Our valuation estimate rises on strong appreciation within its public investments and slightly higher assumptions from several key units. We think the long-term thesis for Fairfax India remains favorable with significant growth opportunities ahead in both existing businesses and via acquisitions,” said Mr. Dwelle.

* Canaccord Genuity’s Doug Taylor cut his Farmers Edge Inc. (FDGE-T) target to $4.50 from $5 with a “hold” rating. Others making changes include: CIBC’s Jacob Bout to $5 from $6 with a “neutral” rating and National Bank’s Richard Tse to $5 from $6 with a “sector perform” rating. The average is $5.50.

“FDGE reported another weak quarter, with Q3/21 growth in subscribed acres and revenue below consensus and our expectations. We have revised our estimates lower yet again to reflect: 1) lower new acre additions, 2) lower Elite program acre conversions, and 3) higher costs. While FDGE believes it has enough cash/liquidity to fund the business until it becomes FCF positive (estimated at 2024), we advise investors to take a more ‘wait and see’ approach. At this point, it is still unclear to us whether the subscription model is the right approach to a digital agronomy platform,” said Mr. Bout.

* Ahead of Wednesday’s release of its fourth-quarter results, Canaccord’s Luke Hannan trimmed his target for Goodfood Market Corp. (FOOD-T) to $11.50 from $12, below the $11.89 average, with a “buy” rating.

“When considering Goodfood’s positioning in the relatively underpenetrated Canadian market, the company’s growth initiatives and its well-positioned balance sheet, we believe the shares are attractively priced at current levels,” he said.

* Canaccord Genuity raised its Firm Capital Property Trust (FCD.UN-X) target to $8.25 from $7.75 with a “buy” rating. The average is $8.

* National Bank’s Cameron Doerksen raised his Heroux-Devtek Inc. (HRX-T) target by $1 to $23 with an “outperform” rating, while TD Securities’ Tim James increased his target to $25 from $24 with a “buy” rating. The average is $23.33.

* National Bank’s Jaeme Gloyn increased his target for Home Capital Group Inc. (HCG-T) to $62 from $59, keeping an “outperform” rating, while Raymond James’ Stephen Boland raised his target to $48 from $39 with a “market perform” rating and BMO’s Étienne Ricard bumped his target to $51 from $49 with an “outperform” rating. The average is $52.71.

“Home Capital reported another quarter with improving originations,” said Mr. Boland. “The growth over the past several quarters has been steady. Headline EPS was above our estimate due to another provision release. Once that was normalized, results were generally in-line with our estimates. HCG did announce a $300-million SIB which will finally reduce their capital to a more normalized range. We expect a dividend will be reestablished following the completion of the SIB. We are maintaining our Market Perform as the stock remains reasonably valued for the ROE it is expected to deliver over the next year including the SIB.”

* Credit Suisse analyst Manav Gupta raised his Imperial Oil Ltd. (IMO-T) target to $48 from $45 with a “neutral” rating. The average is $47.21.

* Scotia Capital’s Michael Doumet cut his Intertape Polymer Group Inc. (ITP-T) to $37 from $40 with a “sector outperform” rating, while National Bank’s Zachary Evershed raised his target to $40.50 from $40 with an “outperform” rating and BMO’s Stephen MacLeod trimmed his target by $1 to $38 with an “outperform” recommendation. The average is $40.06.

“The stock declined 12 per cent on the day, we think due to resin price inflation (which will dissipate) and supply chain disruptions (led to some lost sales). However, all end markets were up year-over-year, with e-comm continuing to be a key growth driver; 2022 demand appears positive too. We like ITP’s e-comm exposure, which positions the company well to benefit from a structural shift in consumer buying patterns. We continue to see a path to further multiple expansion,” said Mr. MacLeod.

* National Bank’s Zachary Evershed lowered his KP Tissue Inc. (KPT-T) target to $10.50 from $11, below the $11.33 average, with a “sector perform” rating, while Desjardins’ Frederic Tremblay cut his target to $11 from $11.50 with a “hold” rating.

“Mixed 3Q21 results featured a beat on revenue and a slight miss on adjusted EBITDA,” said Mr. Tremblay. “While we are pleased with positive volume trends (demand and market share moving in the right direction) and ongoing pricing actions, we continue to see headwinds that should weigh on performance in the near term, including cost inflation and a U.S. labour shortage. We are staying on the sidelines.”

* CIBC’s Stephanie Price cut her Lifeworks Inc. (LWRK-T) target to $38 from $43 with an “outperformer” rating, while Scotia’s Phil Hardie lowered his target to $32 from $27 with a “sector outperform” rating and BMO’s Étienne Ricard trimmed his target to $34 from $39 with an “outperform” recommendation. The average is $36.20.

“LifeWorks reported a surprising Q3 miss, with organic growth impacted by summer holidays in its consulting division and margins under pressure from elevated in-person counseling demand. We view slower organic growth as temporary, but do expect a near-term margin impact as LifeWorks adjusts to elevated demand and a tight labour market in its IHS division. Longer term, we consider the increased focus on employee wellbeing and retention as a positive driver for LifeWorks’ business. With LifeWorks trading at a significant discount to its historical valuation, we regard the stock as attractive at these levels,” said Ms. Price.

* Canaccord Genuity’s Doug Taylor lowered his MDA Ltd. (MDA-T) target to $21 from $22, remaining above the $19.63 average, with a “buy” rating, while BMO’s Thanos Moschopoulos cut his target by $1 to $16.50 with a “market perform” rating.

“We remain Market Perform rated on MDA and have reduced our target to $16.50 following Q3/21 results, which were a miss on revenue but beat on EBITDA, while management reduced its outlook for FY2022 due to program delays (primarily due to supply chain constraints for Telesat Lightspeed). While delays on large, complex programs is par for the course—and shouldn’t impact the lifetime value of the programs —it would appear there’s some incremental uncertainty with respect to MDA’s nearterm outlook. This keeps us on the sidelines, despite the stock’s undemanding FY2023 valuation,” said Mr. Moschopoulos.

* RBC’s Matt Logan raised his target for Minto Apartment Real Estate Investment Trust (MI.UN-T) to $29 from $28 with an “outperform” rating. The average is $27.20.

“The outlook for Minto Apartment REIT’s portfolio continues to improve as life gradually returns to its urban markets,” said Mr. Logan. “While not the hockey stick reopening that some were expecting, progress is tracking slightly ahead of our forecast. Looking ahead, we expect occupancy gains over the winter months to remain gradual. That said, we have full confidence that the recovery remains well under way. Importantly, robust private market demand continues to underpin further NAVPU growth for MI’s high quality portfolio.”

* CIBC’s Anita Soni increased her New Gold Inc. (NGD-N, NGD-T) target to US$2.50 from US$2, topping the US$1.78 average.

* RBC’s Geoffrey Kwan raised his Street-high target for Onex Corp. (ONEX-T) to $131 from $125, topping the $116 average, with an “outperform” rating

“Onex is our 2nd best idea within our coverage universe. Onex continues to deliver very good results with Hard NAV growth at historical highs, yet the shares are mispriced, trading at a 20-per-cent discount to NAV when we think the shares should trade at or a premium to NAV (14-per-cent discount to Hard NAV, which assumes zero value for the asset manager, carried interest and Gluskin Sheff). Onex has been very active this year both deploying capital (US$0.8-billion of equity) and monetizing investments (US$1.2-billion of equity). Historically, buying Onex’s shares at a discount (especially a significant discount) to NAV have been some of the best times to own the stock,” said Mr. Kwan.

* Scotia Capital’s George Doumet bumped up his Park Lawn Corp. (PLC-T) target to $45.50 from $43 with a “sector outperform” rating, while CIBC’s Scott Fromson raised his target to $44 from $43 with an “outperformer” rating. The average is $46.50.

* CIBC’s John Zamparo increased his Sleep Country Canada Holdings Inc. (ZZZ-T) target to $47 from $41 with an “outperformer” rating. Others making changes include: Stifel’s Martin Landry to $49 from $40 with a “buy” rating and National Bank’s Vishal Shreedhar to $46 from $40 with a “sector perform” rating. The average is $44.29.

“ZZZ occupies a relatively protected place in the consumer world. Domestic production somewhat insulates it from supply chain constraints, while passing on inflation has presented little challenge so far. Meanwhile, its partnerships with retailers and brands are clearly working, and the Walmart pilot could grow significantly larger. Some of the stock’s upside has been captured, but we remain buyers. We foresee disclosure of capital allocation (or returns) plans as the stock’s next catalyst,” said Mr. Zamparo.

* National Bank’s John Shao cut his Softchoice Corp. (SFTC-T) target to $32 from $35, keeping a “sector perform” rating, while RBC’s Paul Treiber trimmed his target to $30 from $32 with a “market perform” rating. The average is $35.14.

“Softchoice reported a fundamentally healthy quarter, with Q3 adj. EPS in line with consensus. While Q3 gross profit was slightly above expectations, FX and investments offset the upside to adj. EBITDA and adj. EPS. Looking forward, Softchoice reiterated its FY22 outlook, despite the expectation that near-term supply chain issues are likely to persist,” said Mr. Treiber.

* IA Capital Markets analyst Neil Linsdell raised his target for Supremex Inc. (SXP-T) to $4.50, matching the consensus, from $4.25 with a “buy” rating.

“The Company has managed to maintain good growth, pricing power, and profitability despite negative impacts from COVID-19, supply chain constraints, and labour shortages. We expect the Company to continue managing the secular decline in Envelope, gain market share in the U.S., and further shift towards more Packaging, with an active M&A strategy,” said Mr. Linsdell.

* Canaccord’s Derek Dley lowered his target for Taiga Motors Corp. (TAIG-T) to $22 from $23 with a “buy” rating, while National Bank’s Cameron Doerksen cut his target to $16 from $18 with an “outperform” rating. The average is $19.

* National Bank’s Zachary Evershed raised his Uni-Select Inc. (UNS-T) target to $25.50 from $22, maintaining an “outperform” rating, while BMO’s Jonathan Lamers hiked his target to $30 from $20 with an “outperform” recommendation. The average is $25.42.

“Q3 adjusted EBITDA were 27 per cent above our estimate on stronger operating margins from all three divisions, and the balance sheet has improved rapidly. Senior management sees opportunities to further improve operating practices at all three divisions. Endmarket demand continues to recover, and we have increased conviction that debt reduction will support a resumption of acquisition activity,” said Mr. Lamers.

* National Bank’s Adam Shine raised his target for Yellow Pages Ltd. (Y-T) to $15 from $14, topping the $13.67 average, with a “sector perform” rating.

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