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

While he saw the fourth-quarter 2023 financial results from Waste Connections Inc. (WCN-T, WCN-N) as “solid” alongside “strong” guidance for the current fiscal year, ATB Capital Markets analyst Chris Murray thinks both were anticipated by the Street and already reflected in its share price.

Accordingly, seeing valuations “adequately reflecting” his growth outlook, he downgraded its shares to “sector perform” from “outperform” previously.

The Toronto-based company jumped 4.6 per cent on Wednesday after reporting revenue of $2.04-billion, up 8.9 per cent year-over-year and in line with the expectations of both Mr. Murray and the Street. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) grew 16.4 per cent to $656-million, exceeding the analyst’s estimate of $647-million and the consensus projection of $651-million.

“WCN delivered strong Q4/23 results with robust price-led growth and stronger commodity prices driving 208 basis point in year-over-year margin expansion, offsetting volume headwinds,” the analyst said.

“WCN reported 0.8-per-cent growth in recycling in Q4/23, its first year-over-year increase since Q2/22, reflecting firmer OCC prices in H2/23. OCC and RIN prices have continued to increase in 2024 and provide a more constructive backdrop for the waste majors after posing a margin headwind in 2023. Management confirmed that 40 basis point of the 120 bp of anticipated margin expansion in 2024 is attributable to stronger commodity prices, which offer potential upside.”

Waste Connections announced 2024 guidance for revenue and adjusted EBITDA of $8.75-billion and $2.86-billion, respectively. That implies 13-per-cent earnings growth “with a stronger price/cost spread, accretion from the E&P assets acquired from Secure, and firmer commodity prices underpinning expectations for 120 basis point of year-over-year margin expansion in 2024.”

“Management issued constructive outlook/guidance for 2024 and Q1/24, with price conditions, firmer commodity prices, and easing cost pressures expected to support meaningful margin expansion in 2024 despite operating in a softer volume environment,” he added.

“Management reiterated that inflationary pressure represents a tailwind for price-led growth and provides good visibility into organic growth trends for 2024, with certain competitive markets seeing double-digit core price growth in Q4/23. Inflationary pressure experienced in 2022/2023 continues to bode well for pricing conditions in 2024, as 40% of its book is linked to trailing CPI and should support a stronger cost/price spread given easing cost pressures, particularly around labour.”

After increases to his financial projections, Mr. Murray raised his target for Waste Connections shares to $235 from $200 but lowered his recommendation to reflect a 6.5-per-cent return to that target. The average on the Street is $221.19.

“Shares have been reaching new 52-week highs alongside the group, and trading multiples have expanded. We continue to see 2025 free cash flow as very strong, with a more normal capital profile, however, shares have traded through our valuation guardrails, where we see a 3-per-cent cash yield or a 33 times free cash flow multiple as a governing limit,” he said.

Other analysts making changes include:

* RBC’s Walter Spracklin to US$182 from US$169 with an “outperform” rating.

“Results capped off a solid year for WCN with a strong Q4 report,” said Mr. Spracklin. “FY 2024 guidance was also strong and pointed to (above typical) margin expansion of 120bps, which, based on positive trends coming out of 2023 in employee t/o, recycled commodities and M&A potential, carries in our view a degree of conservatism. Recent contract wins and strategic acquisitions set the company up for efficiency gains via internalization and expanded M&A TAM that did not exist before, thus providing a roadmap to its near-term target of 34-per-cent margins, with management noting it’s not a ceiling.”

* Stifel’s Michael Hoffman to US$180 from US$175 with a “buy” rating.

“WCN set the stage for above average margins before beneficial M&A and a path to 34 per cent faster with upside beyond,” said Mr. Hoffman The drivers are within its control and do not include RNG. The focus is on operating efficiencies;- price/cost: sustain the spread in open markets at 150 basis points to 200 basis points and labor retention: drive down voluntary turnover to 10-12 per cent from 17 per cent over the next 12-18 months and capture 100 basis points of operating leverage in so doing. M&A pipeline beyond what has closed in FY24 is robust (not in guidance) at $150-million or more of acquired sales in Solid Waste.”

* Scotia’s Michael Doumet to US$179 from US$146.50 with a “sector perform” rating.

“As much as 2024 looks to be shaping up to be an above-average year for EBITDA growth and margin expansion, from what we can tell already, 2025 may be another such year, with incremental margin expansion from lower turnover, improved R&M, and incremental RNG contributions — putting that 34-per-cent EBITDA margin in sight. We raised our one-year target to reflect our higher estimates and what we believe to be a valuation multiple reflective of favorable underlying growth, lower 10y rates (vs. late last year), and broadly higher sector multiples,” said Mr. Doumet.

* CIBC’s Kevin Chiang to US$181 from US$167 with an “outperformer” rating.

* JP Morgan’s Stephanie Yee to US$175 from US$153 with an “overweight” rating.

* Jefferies’ Stephanie Moore to US$195 from US$175 with a “buy” rating.

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RBC Dominion Securities analyst Michael Siperco is taking “a wait and see approach” to SSR Mining Inc. (SSRM-Q, SSRM-T) after a landslide forced operations at its Çöpler mine in Turkey to be suspended.

“The reported disaster at Copler (approximately 40 per cent of our unaffected NAV) has created a material stock overhang that could remain for an extended period until there is clarity on the full impact of the landslide, the costs associated with remediation, and any other follow-on effects,” he said. “We now apply a 50-per-cent discount to our revised (post-guidance) Copler valuation and have reduced other forecast.”

Seeing the uncertainty affecting his fundamental outlook and the potential valuation upside, Mr. Siperco lowered his rating to “sector perform” from “outperform” previously.

“We have reduced our production forecasts in 2024-2028 by approximately 15 per cent on average, with 5 per cent higher costs (broadly inline with guidance),” he said. “We have not, however, adjusted our operating/financial estimates to reflect any impact from the Copler suspension, pending further clarity (which we expect over the coming days/weeks).

“Our NAV8-per-cent estimate (including the 50-per-cent Copler discount) is down 50 per cent, to $7.60 per share (Copler at $2.20, 30 per cent). Applying the peer average trading multiple of 0.80 times drives our revised $6.00 price target.”

His target slid to US$6 from US$14. The current average is US$9.67.

“The near term production/cost outlook has been downgraded during a new 3-year investment period, while updated plans and investments could pay off post-2027. Until the future of Copler is no longer in question following the suspension of operations, we see the weaker outlook and increased execution/capital risk as capping relative upside, leading to our lower target and more cautious view,” he added.

Elsewhere, Desjardins Securities’ Jonathan Egilo lowered his target to $7.75 from $18.50 with a “buy” rating.

“While search and rescue remains an ongoing priority, it is too early to determine the future of the operation. Our base-case estimates now model our best-effort estimates of a scenario where Çöpler is permanently suspended and enters a multi-year cleanup period, followed by mine-closure costs being incurred. We therefore model the asset as a liability, and our company-wide NAVPS has fallen 60 per cent to $8.92,” said Mr. Egilo.

“We have not downgraded the stock given that in our view, the current share price could be representative of a potential downside scenario where Çöpler never restarts. The asset previously represented $12.88 in our NAVPS.”

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In a research report released Thursday titled Why we (still) really like CAE shares at these levels, RBC Dominion Securities analyst James McGarragle thinks negative sentiment around CAE Inc.’s (CAE-T) Defense margins are “creating an attractive opportunity.”

“Focus from [Wednesday’s] results (and driver of the share price weakness in our view) was commentary on the Defense outlook, which represented downside versus prior street expectations,” he said. “While this should not be ignored, we remind investors Defense only represents 15 per cent of CAE’s business. Commentary on Civil (the other 85 per cent) suggests a robust demand and solid margin outlook. We value the Civil segment at $28 (12 times EV/ EBITDA multiple), which implies a negative $2.50 is being assigned to Defense, which we see as unwarranted.”

Shares of the Montreal-based flight simulator manufacturer plummeted 9.8 per cent on Wednesday after it reported revenue of $1.094.5-billion, up from $969.9-million during the same period a year ago but narrowly below the Street’s expectation of $1.11-billion. Adjusted earnings per share of 24 cents miss the consensus forecast by 2 cents.

The negative response centered on concerns about its Defense segment’s performance, ignoring what Mr. McGarragle saw as a “strong” outlook for its Civil business.

“Civil margin, which came in below expectations on mix, was in focus during our conversations with investors [Wednesday],” he said. “On the call, management noted they have good visibility to improvement sequentially and combined with a 1.4 times book-to-bill, suggests strong revenue growth and solid operating leverage next year. Key is that Civil represents 85 per cent of CAE’s consolidated operating income and gets overlooked despite solid execution and long-term secular tailwinds in our view.”

“Defense margin commentary was not well-received with management highlighting lowmargin legacy contracts should be substantially retired over the next 6 to 8 quarters. While this mostly aligned with our expectations coming into the quarter and provided more clarity surrounding the timing of these contracts rolling off, we note that it implies a timing and magnitude of improvement below prior street expectations. We are not calling for investors to ignore Defense headwinds in their assessment of CAE shares, but note that the market is effectively assigning no value to the segment anyway. With Defense expectations reset lower (again) we see downside risk to the Defense outlook as limited.”

While he trimmed his revenue and earnings projections for fiscal 2024 and 2025, the analyst maintained his “outperform” recommendation and $34 target The average target is $34.75.

“We believe CAE’s Civil segment is well positioned to benefit from long-term secular tailwinds,” he said. “Our view is that the Civil segment will grow at a pace that meaningfully exceeds the overall economy at an organic growth rate that we peg at a mid- to high-single-digit range out to 2030. Key drivers of this growth are: i) a nearto medium-term recovery in passenger travel; ii) favourable pilot demographics; and iii) specific to the Defense segment, increased spending by NATO members driven by Russia’s invasion of Ukraine.”

“CAE is an industry leader in the Civil Aviation Training market and we note that CAE operates the world’s largest civil aviation training network, which we believe acts as a significant barrier to entry as well as a key differentiator. Our view is that this favourably positions CAE to capitalize on meaningful Civil tailwinds going forward.”

Elsewhere, others making changes include:

* National Bank’s Maxim Sytchev to $34 from $36 with an “outperform” rating.

“The primary reason for our positive view continues to be that we see a multiyear period of growth ahead for the commercial aviation industry that we believe will drive solid growth for CAE’s Civil segment,” he said. “We appreciate that investors are growing increasingly impatient with CAE’s Defense segment margin underperformance, but we reiterate that even when the Defense margin returns to 10 per cent, the Civil segment will still make up 75 per cent plus of total company operating income. We also have confidence that Defense margins will eventually show improvement (CAE still expecting a margin inflection in H2/25) as legacy contracts are completed and as revenue grows supported by a solid backlog and a large pipeline of new order opportunities.”

* Desjardins Securities’ Benoit Poirier to $30 from $35 with a “buy” rating.

“While we are pleased that management has ringfenced the problematic Defence contracts, we have opted for safety and reduced our Defence margin estimates for FY25 (to 4.5 per cent from 6.4 per cent) and FY26 (to 4.9 per cent from 8.3 per cent),” he said. “We believe the ramp-up of the new margin-accretive awards will take time (not an immediate benefit). We also want to account for possible funding delays and to leave some breathing room for increased legacy costs in the future.”

“With the stock trading at $26, we model that the market is currently implying zero contribution from Defence and a return to 22-per-cent margin in FY25 in Civil. While we acknowledge that some investors are not willing to wait until FY26, we also believe the stock is trading at extremely depressed levels (especially when considering the recent L3Harris training transaction at 15 times LTM [last 12-month] EBITDA and the arrival of shareholder returns). This cannot persist forever, in our view, and the value disconnect should disappear at some point.”

* TD Securities’ Tim James to $34 from $36 with a “buy” rating.

“We understand the impetus for the strong downward share price response to the Q3 results and outlook,” said Mr. James. “However, we believe that the extent of the sell-off was an overreaction to the implications of the quarter for the company’s fundamentals and risk. We had not been expecting the start of a sustainable move higher in Defense margins until Q1/F25, and have now updated our assumption to Q3/F25. Regardless of the challenges in forecasting Defense earnings and its contribution to equity value, we believe it will eventually provide a catalyst for the share price, which, combined with the cyclical and secular opportunities in the Civil segment, justifies a higher share price.”

* Canaccord Genuity’s Matthew Lee to $34 from $36 with a “buy” rating.

“In our view, CAE’s current trading multiple gives the firm diminutive value for its defence business, which should revalue as margins begin to improve next year,” said Mr. Lee.

* Scotia’s Konark Gupta to $30 from $31 with a “sector perform” rating.

“CAE delivered a decent quarter, in line with its business plan and our expectations, while slightly missing consensus even when adjusted for discontinued operations,” said Mr. Gupta. “Management views, outlook and commitment to reinstate shareholder returns remained largely intact, pointing to a very strong FQ4 as we have been expecting. Although the company provided additional disclosures on Defense legacy contracts to help investors evaluate the long-term upside in margins, we believe the updated number of contracts with issues, magnitude of margin dilution from them, and the timeline for their roll-off weighed on investor sentiment. Thus, the stock reacted negatively and remains in the penalty box for some more time, although we think down 10 per cent is a bit of an overreaction, considering CAE has lagged the recent market rally. We maintain our Sector Perform rating as we continue to monitor the progress on Defense margin execution and given potential downside risk to CAE’s three-year EPS CAGR target of mid-20 per cent.”

* CIBC’s Kevin Chiang to $32 from $37 with an “outperformer” rating.

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After “strong” fourth-quarter results and a 12-per-cent increase to its dividend, National Bank Financial analyst Maxim Sytchev reaffirmed his view of Toromont Industries Ltd. (TIH-T) as “a defensive industrial name with growth characteristics.”

“Toromont delivered another solid quarter in absolute (good bookings, stable margins off very high levels, SG&A control, EPS growth) and relative terms (4-per-cent gain for Product Support characterized by parts and services momentum and no unusuals),” he said in a research note titled Quality pays, literally. “While we always hear that Toromont’s valuation is ‘expensive,’ the premium appears to be justified when considering the investment thesis holistically, driven by Eastern Canadian demographic trends that are more predictable in nature while also sporting a net cash balance sheet that affords another double-digit increase in the dividend.”

Shares of the Toronto-based heavy equipment dealer jumped 5.4 per cent on Wednesday after it reported quarterly revenue of $1.227-billion, up 9 per cent year-over-year and 3 per cent above the Street’s projection of $1.190-billion. Adjusted earnings per share of $1.85, excluding one-time asset sales gains, was 7 per cent better than the consensus estimate of $1.72.

Toromont raised its quarterly dividend for the 35th consecutive year by 12 per cent to 48 cents.

“The dynamic of normalizing availability of equipment is expected to continue through 2024, which will likely pressure margins from a pricing and sales mix (new equipment sales carry lower gross margins) point of view,” said Mr. Sytchev. “There may be also be some pressure on Product Support if clients are willing to run with lower inventory levels given improved parts availability, though this would be likely be more short-term in nature. However, ongoing streamlining of business operations have helped constrain SG&A growth and should insulate operating and EBITDA margins despite the pressure on gross profit. The late-quarter uptick in construction orders is also an encouraging sign in light of prior commentary of market softness; while higher rates and persistent inflation are of course headwinds, accelerating population growth is lifting the baseline requirements for infrastructure and grid expansion/renewals should provide along-term tailwind as well. Don’t forget that the company continues to hire technicians, the best leading indicator.:

Emphasizing Toromont’s “operating efficiency focus [is] paying off through normalizing availability environment” and seeing potential gains in both Quebec and the Maritimes, Mr. Sytchev raised his target for the company’s shares to $137 from $137, keeping an “outperform” recommendation. The average is $132.33.

Others making adjustments include:

* Raymond James’ Steve Hansen to $125 from $125 with an “outperform” rating.

“We are increasing our target price on Toromont Industries Ltd. (TIH) ... and reiterating our Outperform rating based upon: 1) another solid quarterly beat; 2) upward commensurate revisions to our estimates; 3) solid leading indicators (bookings & backlog) pointing to cycle longevity; 4) the company’s fortress balance sheet (& embedded optionality); and 5) long-term track record for value creation,” said Mr. Hansen.

* Canaccord Genuity’s Yuri Lynk to $138 from $123 with a “buy” rating.

“Toromont remains well-positioned to benefit from the continued expansion of its rental fleet, to grow high-margin product support sales on the back of the growing machine population in its territories, and to benefit from the adoption of CAT’s leading autonomous solutions and electrification roadmap. Toromont trades at 18 times P/E (2024 estimates) vs. Caterpillar, Finning, H&E Equipment, and Komatsu at an average of 11 times. We use 19 times 2025E EPS (previously, H2/2024E-H1/2025E) to set our target price. The balance sheet optionality associated with Toromont’s $393 million of net cash and $1.5 billion in liquidity, combined with its class-leading margin and execution profile, justify its premium valuation, in our view,” said Mr. Lynk.

* Scotia’s Michael Doumet to $133 from $125 with a “sector perform” rating.

“For the equipment dealers, we view 2024 as a ‘return to normal’,” said Mr. Doumet. “Specifically for TIH, 4Q showed early signs that equipment gross margins normalized due to improved availability. While equipment gross margins moderated, a (surprise) re-acceleration in construction equipment demand and, more importantly, strong cost discipline on SG&A enabled TIH to maintain strong operating margins (although still down y/y). In 2024, we still expect a moderation of equipment sales growth, a potential de-stocking of parts, and a normalization of gross margins. However, the sales trend may be slightly more favourable than we previously anticipated and, similar to 4Q, we believe TIH will be able to further enhance operating leverage and, therefore, lessen the impact of the overall normalization to 2024 EPS. TIH trades at 19.4 times/18.4 times P/E on our 2024/25 estimates. TIH shares are not expensive, particularly in light of its track record for strong EPS growth and return metrics. That said, we believe room for additional multiple expansion is limited, as is visibility on a potential needle-moving M&A catalyst.”

* RBC’s Sabahat Khan to $140 from $125 with an “outperform” rating.

“We maintain our positive view on Toromont Industries Ltd. following Q4 results that reflected good top-line/earnings relative to RBC/ consensus expectations and a stable backlog. While the operating backdrop remains uncertain, Toromont continues to drive good growth across its New Equipment/Product Support silos,” said Mr. Khan.

* CIBC’s Jacob Bout to $130 from $123 with a “neutral” rating.

* TD Securities’ Cherilyn Radbourne to $140 from $130 with a “buy” rating.

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Raymond James analyst Brian MacArthur thinks Patriot Battery Metals Inc. (PMET-T) offers investors “good exposure to lithium and, indirectly, to the electrification and decarbonization of the global economy.”

While cautioning the Vancouver-based company is still a developer, he initiated coverage with an “outperform” rating on Thursday, citing the size and grade of its 100-per-cent-owned Corvette property in Quebec as well as its “location near infrastructure, exploration upside, favourable jurisdictional risk, PMET’s strong balance sheet and its MOU [memorandum of understanding] with Albermarle.”

“While lithium prices have been volatile over the last few years, underlying lithium demand has remained strong with 2023 being the third consecutive year with 20-30-per-cent growth in the global lithium market,” said Mr. MacArthur. “We expect the market to grow over 10 per cent in 2024 and longer-term, we believe the large projected growth in lithium demand to supply EVs is likely to require substantial new lithium supply. For more details please refer to our report. While we acknowledge numerous lithium companies exist, we question how many projects will be developed on the timeline and capital budgets that are currently being projected.

“We believe Corvette given its size, grade location, and potential partner could be one that gets developed. The Corvette property hosts the CV5 spodumene pegmatite with a maiden inferred mineral resource estimate of 109.2 Mt at 1.42-per-cent Li2O and ranks as one of the largest lithium pegmatite resources in the Americas based on contained LCE, and one of the top 10 largest lithium pegmatite resources in the world.”

Seeing it well-funded and benefitting from the Albermarle Corp.’s (ALB-N) “expertise” in the sector after a strategic investment from the U.S. company, he set a target of $13.50 per share. The average is $17.66.

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Following the release of its “good quality” quarterly results after the bell on Wednesday, BMO’s Tom MacKinnon upgraded Manulife Financial Corp. (MFC-T) to “outperform” from “market perform,” citing an “improved capital generation outlook” and seeing the drag from alternative long-duration assets (ALDA) “dissipating.”

“While a good GARP story, trading at 8.2 times NTM [next 12-month] core EPS, MFC’s cash remittances net of holdco costs at 75 per cent of core EPS represent an even more attractive 10.8 times price-to-capital generation multiple for an even more attractive 9.3-per-cent FCF yield (second highest among the Canadian lifecos),” he said. “A strong excess capital position, a 16-per-cent-plus core ROE, a 5.2-per-cent dividend yield, and solid buyback support are all positives.”

Also touting “improving earnings visibility” that led him to increase his forecast for fiscal 2024 and 2025, Mr. MacKinnon raised his target for its shares to $35 from $31. The average target on the Street is $31.13.

Elsewhere, others making changes include: TD Securities’ Mario Mendonca to $35 from $34 with an “action list buy” recommendation and National Bank’s Gabriel Dechaine to $33 from $29 with a “sector perform” rating.

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In other analyst actions:

* Beacon Securities’ Russell Stanley thinks Thermal Energy International Inc. (TMG-X) “still undervalued and [its] technical picture looks excellent.” He became the first analyst to initiated coverage of the Ottawa-based company, calling it a compelling investment at current levels” and giving it a “buy” recommendation and 45-cent target.

“The stock has tripled since early September to 30 cents per share,” said Mr. Stanley. “Institutional ownership and awareness are currently limited. We add that CEO William Crossland, the company’s largest shareholder amongst management/board, recently added 400k shares at an ACB of 27 cents per share. Particularly following the stock’s recent rally, we view that buying favourably given his driver’s seat-view of demand. Potential catalysts include contract win announcements, the Q3 results in April, and potential M&A activity, with TMG a likely buyer and possible target.”

* BMO’s Stephen MacLeod raised his Aritzia Inc. (ATZ-T) target to $41 from $38, which is the current average, with a “market perform” rating.

* Jefferies’ Chris Lafemina cut his Barrick Gold Corp. (GOLD-N, ABX-T) target to US$15 from US$17 with a “hold” rating. Other changes include: BMO’s Jackie Przybylowski to US$24 from US$26 with an “outperform” rating and Raymond James’ Brian MacArthur to US$23 from US$24 with an “outperform” rating. The average is US$21.30.

* BMO’s Tamy Chen hiked her Boyd Group Services Inc. (BYD-T) target to $350 from $290 with an “outperform” rating. The average is $302.07.

“We expect more of the same in Q4/23 and 2024 as SSS should normalize somewhat from the mid-teens percentage experienced in most of 2023. We feel comfortable with our MSD% [mid-single digit percentage] SSS forecast for 2024 as repair backlog remains elevated, providing a still solid pipeline of work to process. We continue to like the name and view BYD as a steady compounder capable of growing EBITDA by low-teens percentage annually,” she said.

* Canaccord Genuity’s Mike Mueller lowered his target for Birchcliff Energy Ltd. (BIR-T) to $5.25 from $5.50 with a “hold” rating, while BMO’s Randy Ollenberger trimmed his target to $5.25 from $5.75 with a “market perform” rating. The average is $6.75.

* CIBC’s Nik Priebe raised his Goeasy Ltd. (GSY-T) target to $175 from $160 with a “neutral” rating. Other changes include: Raymond James’ Stephen Boland to $200 from $166 with an “outperform” rating, BMO’s Etienne Ricard to $192 from $187 with an “outperform” rating and National Bank’s Jaeme Gloyn to $195 from $190 with an “outperform” rating. The average is $202.78.

* National Bank’s Jaeme Gloyn reduced his Intact Financial Corp. (IFC-T) target to $245 from $250 with an “outperform” rating. Other changes include: Scotia’s Phil Hardie to $256 from $252 with a “sector outperform” rating, BMO’s Tom MacKinnon to $240 from $230 with an “outperform” rating, Desjardins Securities’ Doug Young to $235 from $230 with a “buy” rating and CIBC’s Paul Holden to $250 from $225 with an “outperformer” rating. The average is $233.27.

“We viewed operating results as positive given solid organic top line growth and profitability performance across all lines, upside on net investment income and a 10-per-cent dividend increase,” said Mr. Gloyn. “Commentary on the conference call reaffirmed our favourable view of the P&C Insurance industry in 2024. We reiterate our view Intact merits a premium valuation given the track record of consistent execution to deliver 10-per-cent EPS growth and to outperform its competitors on ROE.”

* CIBC’s Robert Catellier increased his target for Keyera Corp. (KEY-T) to $36 from $35, keeping a “neutral” recommendation. Other changes include: TD Securities’ Linda Ezergailis to $38 from $37 with a “buy” rating and BMO’s Ben Pham to $36 from $35 with a “market perform” rating. The average is $35.85.

“While fourth-quarter results were overall in line with our expectations, performance across all operating segments was above our forecasts and offset by higher-than-anticipated spending, notably maintenance capital,” said Ms. Ezergailis. “Relative to Q4/22, Liquids Infrastructure results were primarily driven by incremental contribution from the acquired 21-per-cent working interest in KFS, higher contracted volumes, and incremental contribution from KAPS. Marketing performance was above management guidance and benefited from higher iso-octane premiums, sales volumes, and motor gasoline pricing. Results from the G&P business were driven by higher contribution from the Pipestone and Cynthia gas plants.”

* National Bank’s Richard Tse lowered his MDF Commerce Inc. (MDF-T) target to $4 from $4.50 with a “sector perform” rating. The average is $5.13.

* Following institutional meetings with the management of Minto Apartment Real Estate Investment Trust (MI.UN-T), Desjardins Securities’ Kyle Stanley raised his target by $2 to $19.50 with a “buy” rating. The average is $18.89.

“As investors look to position ahead of potential central bank interest rate cuts later in 2024, our preferred asset class remains multifamily. More specifically, MI is poised to benefit from robust rental fundamentals, a healthy organic growth profile, potential external growth opportunities and interest expense tailwinds,” he said.

* CIBC’s Dean Wilkinson cut his RioCan REIT (REI.UN-T) target to $21, below the $21.53 average, from $22 with an “outperformer” rating.

* National Bank’s Adam Shine cut his Spin Master Corp. (TOY-T) target to $42 from $43 with an “outperform” rating, while Jefferies’ Andrew Uerkwitz lowered his target to $40 from $41 with a “buy” rating. The average is $47.75.

* CIBC’s Hamir Patel cut his Western Forest Products Inc. (WEF-T) target by 10 cents to 65 cents, keeping a “neutral” rating, while TD Securities’ Sean Steuart trimmed his target to 75 cents from 85 cents with a “hold” rating. The average is 75 cents.

“Western is trading at steep valuation discounts to long-term average multiples, but, in our view, the company lacks the balance-sheet flexibility of some larger-cap peers, which limits potential catalysts (e.g., acquisition potential or returns of capital to shareholders). We expect gradual progress towards repositioning the company’s asset base,” said Mr. Steuart.

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 22/05/24 3:57pm EDT.

SymbolName% changeLast
ATZ-T
Aritzia Inc
-1.26%32.01
ABX-T
Barrick Gold Corp
-0.97%23.43
BIR-T
Birchcliff Energy Ltd
-2.18%5.83
BYD-T
Boyd Group Services Inc
+0.78%234.98
CAE-T
Cae Inc
+0.51%25.86
GSY-T
Goeasy Ltd
-0.57%171.36
IFC-T
Intact Financial Corp
-0.31%226.79
KEY-T
Keyera Corp
-0.44%35.84
MFC-T
Manulife Fin
-0.39%35.84
MDF-T
Mdf Commerce Inc
0%5.8
MI-UN-T
Minto Apartment REIT
-1.6%14.73
PMET-T
Patriot Battery Metals Inc
-3.05%8.26
REI-UN-T
Riocan Real Est Un
-0.85%17.48
SSRM-T
Ssr Mining Inc
-2.65%7.35
TOY-T
Spin Master Corp
+0.03%29.02
TMG-X
Thermal Energy International Inc
-4.17%0.23
TIH-T
Toromont Ind
-0.89%121.41
WCN-T
Waste Connections Inc
-0.33%225.86
WEF-T
Western Forest Products Inc
-1.96%0.5

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