Inside the Market’s roundup of some of today’s key analyst actions
With its U.S. group businesses continuing to “disappoint,” National Bank Financial analyst Gabriel Dechaine downgraded his rating for Sun Life Financial Inc. (SLF-T) to “sector perform” from “outperform” to reflect “deterioration to SLF’s earnings visibility along with operating challenges, mainly in the U.S.”
After the bell on Thursday, the Toronto-based company reported underlying earnings per share of $1.79, exceeding Mr. Dechaine’s forecast by a penny an analysts’ average estimate on the Street by 2 cents.
“SLF’s Q2/25 results included negative policyholder experience (and credit losses), primarily in the U.S. segment,” he noted. “Negative morbidity was reported in the Dental and Stop-loss lines, while negative mortality was reported in the Individual Insurance business. Of these items, the Dental issue was most disappointing. Dental profits of only US$2-million (US$26-million year-to-date), along with slower Medicaid repricing progress and higher Dental claim severity and utilization, resulted in SLF retracting its 2025 Dental profit target of US$100-million. We believe these issues could also be headwinds beyond 2025, considering regulatory changes embedded in the Big Beautiful Bill. In our view, a write-down of the $3-billion of goodwill & intangibles tied to the 2022 DentaQuest acquisition is possible. We note that SLF’s reported earnings included a $61-million impairment on ‘a customer relationship intangible asset from the early termination of a U.S. group dental contract’“
In a client note released before the bell, Mr. Dechaine did emphasize Sun Life’s “balance sheet strength is still considerable.”
“While operational issues were disappointing, the balance sheet is a strength,” he said. “A 151-per-cent LICAT ratio, a 20-per-cent leverage ratio and $1.1-billion in Holdco cash provide flexibility. $400-million of shares were repurchased this quarter, a trend that could continue if the stock struggles.”
With reductions to his forecast, Mr. Dechaine lowered his target for Sun Life shares to $87 from $93. The average target on the Street is $92.17, according to LSEG data.
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RBC Capital Markets analyst Logan Reich saw Restaurant Brands International Inc.’s (QSR-N, QSR-T) second-quarter report as “mixed” with a difficult macroeconomic backdrop threatening to further weigh on the parent company of Tim Hortons and Burger King.
"Positively, TH SSS [same-store sales] beat with strength across dayparts, BK China trends are improving, and total int’l segment was above Street expectations,“ he said. ”Less positively, investor consternation around a slowing U.S. consumer and intense competition impacting BK US is unlikely to abate where the segment has been an outsized driver of the stock relative to its contribution to profitability. While somewhat out of the company’s control, further consumer slowdown could result in SSS downside and/or share loss."
TSX-listed shares of the Toronto-based company slid over 5 per cent on Thursday despite reporting quarterly revenue of US$2.41-billion, beating analysts’ estimates of US$2.32-billion, according to data compiled by LSEG. However, its adjusted profit of 94 US cents per share fell short of the Street’s forecast of 97 US cents, due, in part, to a rise in advertising expenses as well as higher costs from supply chain and commodities, including beef and coffee.
“What the bulls liked. 1) TH strong top-line beat. SSS came in 162 basis points ahead of consensus which was driven by both check and traffic, which was positive. Despite the brand’s 70 per cent market share in the AM, that daypart grew 5 per cent driven by 10-per-cent breakfast food growth on marketing & new Breakfast Box platform. Further, beverage grew 4 per cent year-over-year on cold & espresso where the company expects to roll out new espresso machines this year. Given the TH SSS miss last quarter, the acceleration was encouraging. Lastly, speed of service continued to improve across all dayparts and guest satisfaction increased 4 pp y/y. 2) BK China improving. China was ahead of management expectations in Q2 as the company made adjustments to local management and tweaked marketing around core burger & chicken offerings. Comps were positive in the quarter which at least partially benefitted from an improving macro backdrop. While BK China is a small contributor to the model today (was only 1.6 per cent of system sales in ’24), it’s an important market in terms of unit growth and the improvement could improve sentiment where a sale could provide further upside. 3) Int’l segment above expectations. Beyond China, UK, Spain, Germany, Japan, and Australia were the callouts of outperformance while France has been softer in recent quarters but is improving. Int’l segment is 26 per cent of QSR’s AOI and is a 66-per-cent margin business where top-line upside is accretive to overall margins,” concluded Mr. Reich.
Despite those positive conclusions, Mr. Reich also emphasized the presence of lingering consumer concerns for Burger King’s U.S. operations, given weakness in low-income consumer traffic, as well as the company’s margin miss.
That led him to cut his target for Restaurant Brands shares to US$77 from US$80, keeping an “outperform” rating. The average is US$76.87.
Others making changes include:
* Citi’s Jon Tower to US$72 from US$76 with a “neutral” rating.
“The clear bright spots are QSR’s primary profit centers (TH CAN, BK INTL), with both segments appearing to take demand challenges head-on by leaning into core brand equities to grow share,” said Mr. Tower. “The remaining businesses continue to work their way through fits/starts posed by macro (e.g., weaker lower income demand in the U.S.) and micro forces (e.g., China turnaround, intentional slower PLK growth), which muddies the aggregate sys-sales-to-AOI growth picture. 8-per-cent AOI [adjusted operating income] growth in ’25 is within reach (G&A cuts, lower marketing spend, lapping bad debt expense), but its more challenging to get there in ‘26/’27 without more cost savings and/or outsized comp growth. With limited visibility here, we expect multiple expansion to remain capped.”
* Scotia’s John Zamparo to US$71 from US$75 with a “sector perform” rating.
“[Thursday’s] negative 4-per-cent reaction (amid a broader discretionary selloff) probably doesn’t give sufficient credit to the solid Tims SSS, though we believe the challenges facing quick-service are becoming better understood,” said Mr. Zamparo. “We highlight these risks for RBI through 2025. (1) We expect a continuation of U.S. consumer trends: low sentiment, decelerating year-over-year retail sales growth, and disproportionate pressure on low-income consumers. (2) We believe there’s some risk that net restaurant growth (NRG) comes in light this year from pressure on consumers and franchisee profitability; (3) There’s an increasing probability in our view that BK U.S. four-wall EBITDA challenges could result in a $60-million headwind to 2027E EBITDA; and (4) PLK appears to be losing share, and the steps to address domestic restaurant footprints could take a few years.”
* Barclays’ Jeffrey Bernstein to US$78 from US$80 with an “overweight” rating.
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While Canadian Tire Corp. Ltd. (CTC.A-T) enjoyed “resilient" consumer spending in the second quarter, its results were “more than offset by heightened investments,” according to National Bank Financial analyst Vishal Shreedhar.
"Dealer demand was strong, reflecting resilient consumer spending (higher traffic & basket; dealer inventory flat y/y due to strong sell-through),“ he said. ”Replenishment (particularly in winter-related inventory) is expected to be solid in H2/25. Encouragingly, CTC noted consumer resiliency across all income levels and signs of consumer confidence recovery (albeit still low).
“CTC reiterated its annualized gross margin target of 35 per cent; the gross margin rate is expected to be lower year-over-year in Q3/25 (F/X pressure) and higher year-over-year in Q4/25. Elevated expenses are expected to offset favourable spending trends: (i) Infrastructure investments in CTFS in H2/25 and 2026 (SG&A rate of 27 per cent), and (ii) True North ($20-milion in Q2/25; $40-million in H2/25). CTC expects to largely complete its restructuring process in Q3/25 (SG&A benefits in Q4/25).”
On Thursday, the shares of the Toronto-based company plummeted 10.6 per cent after it reported earnings per share of $3.57, down 17 cents from the same period in the last fiscal year and falling short of both Mr. Shreehar’s $4.12 estimate and the consensus projection on the Street of $3.91. That came despite stronger-than-anticipated revenue as heightened expense weighed.
In response to the quarterly report, Mr. Shreedhar cut his EPS estimates to $13.14 from $13.46 for 2025 and to $14.75 from $16.20 for 2026.
That prompted him to lower his target for Canadian Tire shares to $190 from $204, reiterating a “sector perform” rating. The average is $176.20.
"Given uneven operating performance, and ongoing disruption related to the True North strategy, we see more attractive opportunities elsewhere in our coverage universe. Indications of resilient consumer spending (which are constructive if sustained) are offset by expectations for heightened near term investments. CTC expects to provide an update on its capital allocation plans in Q3/25 (excess capital from Helly Hansen sale)," he said.
Elsewhere, a pair of analysts downgraded Canadian Tire:
* BMO’s Tamy Chen to “market perform” from “outperform” with a $175 target, falling from $191.
“We upgraded the stock in February as we felt the stock at $135 was pricing in a fairly punitive macro outlook and discounting the benefits selling Helly Hansen would have for CTC’s balance sheet and pace of share buybacks,” she said.
“What’s changed? We acknowledge our downgrade comes when the stock is now off its recent high. Our Market Perform rating reflects our now neutral view on the stock. With Q2/25 results and the latest commentary from management, we now have an updated glimpse on current consumer trends at least in CTC’s banners, how this sales trend is impacting volume-driven opex growth, where inflation-driven opex growth may be trending at, and True North spend. Our revised view from this updated glimpse is we now feel more cautious towards the opex outlook at CTC going forward ... On today’s share price, our SOTP valuation, which includes our revised estimates, implies CTC Retail is trading at 5.2 times our 2026E EBITDA vs. historical 4.5-6 times range.”
* TD Cowen’s Brian Morrison to “hold” from “buy” with a $184 target, down from $201.
“Canadian Tire Q2/25 results were slightly below consensus. The bigger issue is that following the Q1/25 release that drove material share appreciation, expectations were lofty for Q2/25. While there are many positive takeaways in the results, the focal point is that required investment for H2/25 will prove a greater headwind to leverage than previously forecast. Expectations were not met,” said Mr. Morrison.
Analysts making target changes include:
* Desjardins Securities’ Chris Li to $185 from with a “buy” rating.
“We are not entirely surprised by the sharp share price decline (down 11 per cent) as expectations were elevated ahead of the results,” said Mr. Li. “While top-line growth was strong, it was offset by heightened growth investments in both Retail and Financial Services which are expected to persist for the next few quarters. We expect the stock to be range-bound near-term until earnings visibility improves. For long-term investors, we believe successful execution of the True North strategy should drive attractive earnings growth longer-term.”
* Scotia’s John Zamparo to $150 from $145 with a “sector underperform” rating.
“CTC’s combination of a Q2 EPS miss, messaging of higher spending to come and a risk-off day drove the shares down double-digits,” said Mr. Zamparo. “Our bearish call on CTC has primarily been based on what we expected would be a difficult macro environment, particularly for higher-ticket discretionary items and the financial services business. Those results have held in better than expected, owing to execution, patriotic purchasing, and consumer spending that to this point has held in. However, we approach 2H with at least some caution on this front, and the higher SG&A messaging causes meaningful downward revisions in our EPS forecasts (down 5.6 per cent this year, down 14.7 per cent next year). We remain SU-rated on CTC, but increase our price target to $150 from $145 (lower EPS, higher multiple) on better top-line results than anticipated.”
* TD Cowen’s Brian Morrison to $184 from $201 with a “buy” rating.
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In a research report reviewing the second-quarter results from AtkinsRéalis Group Inc. (ATRL-T) titled Onwards and Upwards, Scotia Capital analyst Jonathan Goldman advises “investors that were waiting on the sidelines for a pullback should buy soon."
On Thursday, the Montreal-based firm, formerly known as SNC-Lavalin Group Inc, reported quarterly consolidated adjusted EBITDA of $256.4-million and adjusted earnings per share of 80 cents, exceeding the Street’s expectations of $240.2-million and 71 cents, respectively. The beat was driven by higher sales as well as better-than-anticipated gains in both its Engineering Services and Nuclear businesses.
“We were awaiting a potential pullback in the shares in case Engineering Services margins did not expand as quickly as expected,” said Mr. Goldman. “That did not happen: ES adjusted EBITDA margins of 15.7 per cent were well ahead of our estimate of 15.0 per cent. Moreover, Canada margins improved 430 basis points year-over-year to 15.1 per cent within the same zip code as peers. While there is always some lumpiness from quarter to quarter, and we’re not saying progress will be linear, we think the trends is upwards. Moreover, we think margin expansion is being supported largely by structural initiatives, such as improved pricing in the business lines, greater usage of GTC, and strong execution. ES organic growth guidance has been derisked, in our view, with the company now expecting mid-single-digits in 2025 vs. 7 per cent to 9 per cent previously. Nuclear always seems to surprise to the upside these days and there are additional catalysts (e.g.: Government of Canada selection of preferred vendor, initial purchase orders, new wins abroad).”
Mr. Goldman said he “wouldn’t want to bet” against a company with $1-billion of cash on its balance, noting AtkinsRéalis exited the quarter with leverage ratio of negative 0.3 times.
“Management is looking to deploy $1 billion to $1.5-billion in the next two years towards M&A on tuck-ins or multiple David Evans’ sized bolt-ons, which would get leverage back to the low-end of the target range of 1 times to 2 times,” he added. “[Scotia’s] strategy team correctly predicated the addition of ATRL during the MSCI rebalance. We can still expect outperformance to resume nearer the rebalance date as funds preposition and this can carry through up to a month post rebalance.”
Reaffirming his “sector outperform” recommendation for its shares, Mr. Goldman increased his target to $113 from $108. The average is $109.46.
Other analysts making adjustments include:
* National Bank’s Maxim Sytchev to $100 from $98 with a “sector perform” rating.
“Shares went parabolic post Q1/25 on Nuclear re-rate; [Thursday] we see a more normal reaction on a well-executing performance but against a 26-per-cent share price year-to-date advance vs. TSX at 13 per cent and in line to WSP/STN P/E valuation,” he said. “Next leg of share price appreciation appears more moderate to us as a result given the well-understood nature of positives.”
* Desjardins Securities’ Benoit Poirier to $116 from $115 with a “buy” rating.
“We are pleased with ATRL’s 2Q results and the Nuclear guidance increase,” he said. “The shift in capital allocation (from buybacks to M&A) as well as revised guidance for Engineering should not come as a total surprise. As a result, we have entirely removed buybacks from our model and remain confident in management’s ability to deploy $1.0–1.5-billion toward tuck-ins over the next 12–18 months. Our revised target price is mainly driven by increased Nuclear estimates, a key driver given the higher multiple.”
* ATB Capital Markets’ Chris Murray to $115 from $105 with an “outperform” rating.
“Post the 407 sale and debt repayments, the Company is in a net cash position, which we expect to support stronger M&A and buyback activity going forward. While ATRL has outperformed in 2025, we would remain buyers with increasing demand for its nuclear offerings and accelerating M&A activity providing upside to longer-term targets,” said Mr. Murray.
* RBC’s Sabahat Khan to $112 from $102 with an “outperform” rating.
“AtkinsRéalis reported Q2 results that were ahead of consensus, with Nuclear yet again a standout (2025 segmented revenue guide revised higher again). Although Engineering Services Regions (”ESR") organic growth was a bit soft, we believe the segment’s record backlog positions it well for an acceleration in H2 and beyond. Combined with a positive outlook for the remainder of the business, we continue to view AtkinsRéalis as attractive at current levels," said Mr. Khan.
* TD Cowen’s Michael Tupholme to $124 from $123 with a “buy” rating.
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Seeing WSP Global Inc.’s (WSP-T) second quarter as “solid” overall, National Bank Financial analyst Maxim Sytchev said he’s "a buyer on a downdraft" after its shares slid 3.5 per cent on Thursday.
“Share price retrenchment feels aggressive to us even though we understand that the market is very sensitive to organic growth numbers (we are buyers here); that being said, this is just one number and on the call management demonstrated confidence that APAC region will see improving trends as the year progresses given backlog and rationalization efforts that already took place and are yielding margin improvements already,“ he said. ”Double-digit growth at POWER will start becoming ‘organic’ once we lap the October 1, 2024, closing + 12 months. We view WSP’s platform as ready to undertake another move forward when it comes to M&A given 1.5 times leverage and relatively active market (note that UK-based 2,700-employee strong Ricardo was a nice addition already). Recall that Western Europe, the U.S. and AUS present white space in terms of specific geographic locales or vertical expansions.
“We view WSP shares as a core holding of any Canadian (and global) industrial portfolio.”
The negative reaction for the Street came after the Montreal-based professional services firm reported net revenue of $3.476-billion, up 16 per cent year-over-year on a consolidated basis but narrowly below Mr. Sytchev’s $3.531-billion estimate and the consensus forecast of $3.495-billion. Adjusted EBITDA of $633-million came in better than anticipated ($629-million and $627-million, respectively) as margins improved from the same period a year ago. Adjusted earnings per share of $2.35 matched the analyst’s projection and topped the Street by 8 cents.
“The 81 basis points year-over-year jump in EBITDA margins was well ahead of our expectations and, perhaps more importantly, was driven by several complementary factors,” said Mr. Sytchev. “Firstly, the increased use of digital tools (and digital-related revenues continue to grow at twice the rate of the overall business, in line with WSP’s targets) has increased employee productivity noticeably. Secondly, utilization also ticked up, providing a direct flow through to higher incremental profits. Lastly, WSP’s expertise and reputation have allowed the company to become a preferred consultant across a multitude of sectors and geographies, helping pricing power.
“M&A continues to be a significant value driver. POWER continues to grow at double-digit rates and has seen a big increase in margins since the acquisition closed only 10 months ago. The employees are in the process of being transitioned to the new ERP system and, overall, 70 per cent of employees and 80 per cent of EBITDA have now been onboarded. Given the structural step-up in energy demand and grid strengthening/expansion initiatives, the bidding pipeline is very promising and there are plenty of cross-selling opportunities. For the upcoming Ricardo acquisition (expected to close in early Q4/25E), management is confident that margins can be brought up to that of WSP as a whole.”
Following modest adjustments to his financial forecast, Mr. Sytchev raised his target for WSP to $297 from $292. The average is $307.14.
Elsewhere, other changes include:
* RBC’s Sabahat Khan raised to $293 from $289 with an “outperform” rating.
“WSP delivered Q2 results that were in line to ahead of Street expectations, reflecting good progress in the base business and notable execution in the acquired POWER Engineers business, while 2025 Adjusted EBITDA expectation was nudged to the higher end of the previous guidance range. Overall, we continue to view the compounding story as firmly intact and expect a re- acceleration of organic growth going forward,” said Mr. Khan.
* ATB Capital Markets’ Chris Murray to $305 from $270 with a “sector perform” rating.
“While guidance was left unchanged, management expects to achieve the higher end of its Adjusted EBITDA range, in-line with ATBe. Bookings remained healthy in the quarter, with management remaining positive on demand conditions in H2/25. While improving margin trends and M&A support a sizable increase to our PT, valuations keep us neutral on WSP,” said Mr. Murray.
* Desjardins Securities’ Benoit Poirier to $313 from $301 with a “buy” rating.
“Based on the two developments below, we have raised our FCF estimates meaningfully. Even after accounting for the Ricardo cash outflow, we expect WSP to end 2025 and 2026 with leverage of just 1.5 times and 1.1 times, respectively. This points to solid M&A capacity and lowers the risk of equity dilution—supporting further upside from WSP’s track record of accretive deals. We see [Thursday’s] share price reaction (down 4–5 per cent) as unjustified and an excellent buying opportunity,” he said.
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Seeing its stock “fully valued until further catalysts emerge,” Raymond James analyst Stephen Boland lowered his rating for ECN Capital Corp. (ECN-T) to “market perform” from “outperform” previously.
“ECN reported its 2Q25 results on August 7th, with EPS of $0.04 in-line with RJL and consensus,” he said. “As expected (and telegraphed by management last quarter), a marked improvement in originations at Triad (setting a record this quarter) was offset by another seasonally slow quarter for the RV/Marine division as the industry continues to grapple through a period of tapered demand for boats and recreational vehicles. Reflecting the weakness in RV/Marine, ECN tightened their annual EPS guidance range to $0.18-$0.23 from $0.19-$0.25 previously. We’d note that guidance still implies a considerable improvement in operating results in the second half of the year, though management does expect a notable uplift in RV/Marine originations following a strong June/July season. Triad is also expected to benefit from ongoing operational initiatives (a new co-CEO was hired this quarter) and continued strength in Chattel originations. The addictions to management may take time to translate into higher financial success.
“With ECN’s stock moving closer to our $3.25 target, we are downgrading our rating to Market Perform due to the lower return to our target price. We expect results to improve through 2H25, though we believe the shares are largely reflecting this dynamic following a 20-per-cent-plus run since the beginning of June (S&P/TSX 6.0 per cent). And while the expiry of the Champion standstill in September lends credence to a potential takeover scenario, this may be dependent on a sale of the RV/Marine division. As such, with the current valuation and uncertainty with the future structure of the businesses and company we are moving to a Market Perform rating.”
His target remains $3.25, which sits below the $3.50 average on the Street.
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In other analyst actions:
* Scotia’s Kevin Krishnaratne cut his Altus Group Ltd. (AIF-T) target by $2 to $53 with a “sector perform” rating. The average is $58.71.
“Altus Analytics (AA) reported broadly in-line recurring revenue exFX at 3.7 per cent (we were at 4.0 per cent vs. outlook range of 3.0 per cent to 5.0 per cent), but better Adj. EBITDA margins of 29.3 per cent vs. the Street’s 28.7 per cent,” said Mr. Krishnaratne. “FY25 revenue guide was lowered, reflecting uncertainty in VMS given the softer CRE backdrop, though there are some positive signs potentially on the horizon (VMS recurring bookings strong, transaction volumes stabilizing, and transaction dollar volumes up). Still, we view management’s approach to guidance as prudent given VMS clients remain on the sidelines and as we wait to see how adoption of the company’s newer ARGUS Intelligence modules progresses (big software renewal opportunity in Q4 will provide some insight on traction with the modules and on the company’s shift to asset-based pricing models).”
* Mr. Krishnaratne raised his Kinaxis Inc. (KXS-T) target to $240 from $225 with a “sector outperform” rating. The average is $226.41.
“KXS delivered another strong quarter of results with SaaS growth accelerating and the company posting its fifth consecutive quarter of Rule-of-40 performance. Impressively, win rates are improving and demand for its solutions is benefiting from multiple tailwinds, not just tariff uncertainty, but owing to a growing appreciation by customers for the need to maintain supply chain resiliency. We believe the SaaS growth guide of 13 per cent to 15 per cent is likely conservative given the strong demand backdrop (we are at the top end of the range), and look forward to more beat and raise performance for the remainder of the year,” Mr. Krishnaratne said.
* RBC’s Sabahat Khan cut his ATS Corp. (ATS-T) target by $1 to $49 with an “outperform” rating, while Raymond James’ Michael Glen lowered his target to $46 from $48 with an “outperform” rating. The average is $46.56.
“ATS reported FQ1 Adj. EBITDA modestly ahead of Street estimates, while FQ2 revenue guidance was in line,” said Mr. Khan. “Although organic growth (down 1.2 per cent year-over-year) and bookings (down 20.7 per cent year-over-year organically) were below forecasts, we believe the company’s near-record backlog positions it well going forward (with potential for upside from recent legislation coming out of the U.S., which could encourage re-shoring).”
* Desjardins Securities’ Jerome Dubreuil raised his BCE Inc. (BCE-T) target to $40.50 from $40 with a “buy” rating, while TD Cowen’s Vince Valentini increased his target to $35 from $33. The average is $33.93.
“With BCE shares closing up 2 per cent, we are encouraged that the market looked past the 2025 downward FCF guidance and is starting to better appreciate the medium-term outlook. We expect more investors will soon run the math on Ziply, which could drive attention toward the under-owned BCE. While EBITDA growth in Canada is slightly trailing the previous mid-point of guidance, we believe the improving wireless trends and the Ziply opportunity are not well-reflected in the stock,” said Mr. Dubreuil.
* RBC’s Bart Dziarski increased his target for Brookfield Corp. (BN-N, BN-T) to US$83 from US$81, exceeding the US$71.57 average, with an “outperform” rating. Other changes include:TD Cowen’s Cherilyn Radbourne to US$83 from US$82 with a “buy” rating and BMO’s Sohrab Movahedi raised his target to US$69 from US$66 with an “outperform” rating.
“Brookfield Corporation (BN) continues to deliver solid quarterly results with multiple catalysts that could deliver multi-year growth in distributable earnings and value per share: (1) growth in Brookfield Wealth Solutions (BWS) through higher assets, including via enhanced distribution channels; (2) cash carried interest that management expects to meaningfully step-up in 2026 & beyond; (3) the rotation of core real estate into BWS over time as well as the continued sell-down of the Transitional & Development assets; and (4) continued accretive share buybacks below our estimated NAV,” Mr. Dziarski said.
* Mr. Dziarski also raised his Element Fleet Management Corp. (EFN-T) target to $47 from $43 with an “outperform” rating, while BMO’s Tom MacKinnon raised his target to $40 from $35 with an “outperform” rating.. The average is $42.46.
“Q2/25 results continue to highlight why Element is our top growth pick. Management expects to be at or above 2025 guidance on all metrics (except originations). Element continues its path of shifting towards a capital-light business model announcing Element Mobility and a new partnership with Motus which enhance its value proposition with clients and, in the case of Motus, opens up a new TAM for companies whose employees drive their own cars for work,” Mr. Dziarski said.
* RBC’s Greg Pardy cut his Canadian Natural Resources Ltd. (CNQ-T) target to $62 from $64 with an “outperform” rating, while Raymond James’ Michael Barth increased his target to $54 from $52 with an “outperform” rating. The average is $51.71.
“Our constructive stance towards CNQ reflects its top-drawer leadership team, shareholder alignment, best-in-class operating performance, abundant shareholder returns and free cash flow generation throughout the cycle. We are reaffirming an Outperform recommendation on CNQ and trimming our one-year target price by $2 (3 per cent) to $62 per share. CNQ remains our favourite senior producer in Canada and is on our Global Energy Best Ideas list,” said Mr. Pardy.
* Scotia’s Konark Gupta raised his Cargojet Inc. (CJT-T) target to $140 from $138 with a “sector outperform” rating. Other changes include: TD Cowen’s Tim James to $160 from $150 with a “buy” rating and ATB Capital Markets’ Chris Murray to $145 from $155 with an “outperform” rating. The average is $140.75.
“We are surprised by the muted reaction to Q2 results and to particularly two positive announcements, considering valuation was already below the pre-pandemic trough of 7.5 times heading into the earnings,” said Mr. Gupta. “While CJT is not highly liquid (plus float has been shrinking with buybacks), we see a compelling long-term opportunity here. If valuation remains depressed for longer, we think the story could become ripe for strategic outcomes such as privatization. Our thesis is hinged on our view that CJT will continue to balance growth with FCF, which makes EV/EBITDA valuation of 6.2 times on 2026E highly attractive vs. prepandemic average of 10 times. Besides solid competitive moat and high margins, CJT enjoys long-term contracts with top customers extending to 2029-2037 - a rare feature in freight industry.”
* RBC’s Matthew McKellar raised his Cascades Inc. (CAS-T) target by $1 to $11 with a “sector perform” rating, while TD Cowen’s Sean Steuart moved his target to $10 from $9.50 with a “hold” rating. The average is $10.17.
“Cascades seems to be gaining operational momentum into H2/25 with the resolution of steam issues at Greenpac, progress in ramping up Bear Island, and continued optimization of its tissue system. We maintain some caution around the potential for rising recovered paper prices, and continue to see more compelling opportunities elsewhere in our coverage for now, but acknowledge that we could see a path to stronger results with good execution, particularly as it relates to Bear Island and the cost savings program,” said Mr. McKellar.
* RBC’s Keith Mackey bumped his target for Enerflex Ltd. (EFX-T) to US$13 from US$12 with an “outperform” rating. Other changes include: TD Cowen’s Aaron MacNeil to $17 from $15 with a “buy” rating, Raymond James’ Michael Barth increased his target to $18.25 from $17.75 with an “outperform” rating, ATB Capital Markets’ Tim Monachello to $19 (Canadian) from $16.50 with an “outperform” rating and BMO’s John Gibson to $16 (Canadian) from $15 with an “outperform” rating. The average is $15.46 (Canadian).
“Enerflex reported a solid quarter, with EBITDA, EPS and Engineered Systemsbookings well ahead of our expectations. We remain bullish on EFX shares given exposure to positive macro trends, expanding ROCE/financial metrics, and broadened capital allocation approach. ... Enerflex is on RBC’s Global Energy Best Ideas list,” said Mr. Mackey.
* National Bank’s Giuliano Thornhill raised his Extendicare Inc. (EXE-T) target to $16.10 from $15.40 with an “outperform” rating. The average is $16.23.
“Despite strong execution and financial outperformance, EXE’s muted share price reaction suggests investors are adopting a wait-and-see approach or that there could be fatigue setting in for the sector. With multiple catalysts now in play for EXE, such as integrating Closing the Gap and potential deployment of capital, attention turns toward continued execution and optimal capital allocation decisions,” said Mr. Thornhill.
* National Bank’s Matt Kornack increased his Flagship Communities REIT (MHC.U-T) target to US$23, exceeding the US$21.72 average, from US$21.75 with an “outperform” rating. Other changes include: Raymond James’ Brad Sturges to US$22.75 from US$22.25 with a “strong buy” rating and RBC’s Jimmy Shan to US$23 from US$21 with an “outperform” rating.
“MHC printed another strong quarter, these are becoming par for the course as underlying fundamentals remain strong for the business as its affordable housing offering meets the moment in the U.S. where home prices remain high, interest rates elevated and with traditional rental properties still achieving lofty rents relative to MHC product in similar markets,” said Mr. Kornack. “It is worth noting that capex has been elevated which is likely aiding operating performance (since going public the REIT has spent 45 per cent of NOI on property investments). We see no reason why performance should slow materially in the near future and remain constructive on the name given its high implied cap rate vs. growth being achieved.”
* Scotia’s Phil Hardie raised his Goeasy Ltd. (GSY-T) target to $235 from $230 with a “sector perform” rating, while BMO’s Étienne Ricard raised his target to $232 from $228 with an “outperform” rating. The average is $238.11.
“Investors reacted positively to goeasy’s Q2/25 results, which reflected a solid recovery with earnings ahead of expectations and 2025 guidance maintained. This followed a disappointing start to the year. The quarter was characterized by robust loan growth, relatively solid underlying credit trends, and a sequential recovery in the financial revenue yield. The yield expansion follows a surprisingly steep compression last quarter that created some investor concerns about goeasy’s ability to meet its 2025 targets. The second quarter is likely to alleviate those concerns,” Mr. Hardie said.
* Mr. Hardie increased his target for Onex Corp. (ONEX-T) to $140 from $135 with a “sector outperform” rating. The average is $144.
“We are encouraged by Onex’s Q2/25 performance, and while broader macroeconomic uncertainties remain, we believe the stock’s discount already reflects a high degree of risk,” said Mr. Hardie. “We believe investors are likely underestimating the potential for NAV growth and discount tightening over the next twelve months.”
“The quarter saw several examples of management pulling levers to drive shareholder value. These included successful value-accretive monetizations in WestJet and Precision Concepts, solid fundraising across Private Equity and Credit Platforms, continued share buybacks which given the discounted stock price are likely to be accretive to NAV/sh. The quarter also saw an improving outlook on M&A activity which we expect to support further monetization activity as the year progresses. Onex remains one of our top value ideas, and given the steep discount it trades at vs. our forward NAV estimate, we think the stock offers an attractive entry opportunity.”
* TD Cowen’s Graham Ryding increased his IGM Financial Inc. (IGM-T) target to $57 from $55 with a “buy” rating. Other changes include: BMO’s Tom MacKinnon to $49 from $47 with a “market perform” rating, RBCs’ Bart Dziarski to $49 from $46 with a “sector perform” rating and National Bank’s Jaeme Gloyn to $58 from $56 with an “outperform” rating. The average is $52.50.
“Adjusted EPS of $1.07 was comfortably above us and consensus, and up 15 per cent year-over-year,” Mr. Ryding said. “Wealth adjusted net earnings were up 20 per cent year-over-year, asset management was up 8 per cent, and strategic investments were up 12 per cent year-over-year. We are encouraged with management’s appetite for buybacks, improving trends within the core entities and strategic investments.”
* National Bank’s Zachary Evershed bumped his target for shares of Jamieson Wellness Inc. (JWEL-T) to $40.50 from $40 with an “outperform” rating. Other changes include: TD Cowen’s Derek Lessard to $45 from $42 with a “buy” rating and BMO’s Stephen MacLeod to $42 from $41 with an “outperform” rating. The average is $42.
“With exceptional growth in China in Q1 at 71.0 per cent bringing year-to-date growth in the country to 62 per cent, even the newly increased annual guidance of 30-40 per cent for the country implies a much slower pace in H2 (in the 6-23-per-cent range),” said Mr. Evershed. “While Q3 is another difficult comp with 81.7-per-cent year-over-year growth in the year ago period, we note Q2 delivered on top of the 106.6-per-cent increase in the comp period, so this isn’t an insurmountable obstacle. We believe management may be understating H2’s potential, particularly given: growth in traditional channels (icing on top of growth in social commerce), growing brand equity with consumers, and market share growth outpacing all foreign-branded competitors.”
* In response to “strong” quarterly results and a 20-per-cent dividend increase, Stifel’s Martin Landry moved his Leon’s Furniture Ltd. (LNF-T) target to $30 from $27 with a “hold” rating. Other changes include: BMO’s Stephen MacLeod to $32 from $29 with a “market perform” rating and National Bank’s Ahmed Abdullah to $35 from 34 with an “outperform” rating. The average is $35.
“Leon’s Furniture reported Q2/25 EPS of $0.57, up a strong 29 per cent year-over-year and higher than our estimate of $0.48 and consensus of $0.46. The beat vs our expectations was broad based and is explained by higher revenues, higher gross profit margins and lower SG&A expenses than expected. The company is benefitting from a favourable mix, sourcing enhancement and efficiency programs implemented in the last year. On the back of these strong results and improving balance sheet, the Board has approved a 20-per-cent dividend increase. We have raised our forecasts to reflect the recent momentum and increased our valuation multiple, which translate into an increase of our target price ,” said Mr. Landry.
* Seeing its momentum continue with an “exceptional” second quarter, Mr. Landry raised his Maple Leaf Foods Inc. (MFI-T) target to $40.50 from $36.50 with a “buy” recommendation. Other changes include: Scotia’s John Zamparo to $35 from $30 with a “sector perform” rating, TD Cowen’s Michael Van Aelst to $42 from $41 with a “buy” rating, RBC’s Irene Nattel to $38 from $35 with an “outperform” rating and National Bank’s Vishal Shreehar to $36 from $31 with an “outperform” rating. The average is $37.79.
“Maple Leaf reported a resounding Q2/25 beat with adjusted EPS of $0.56, higher than our forecasts of $0.43 and consensus estimates of $0.46,” said Mr. Landry. “The earnings beat was driven by strong sales growth of 8 per cent year-over-year, the fastest growth pace of the last four years. In addition, the company reported strong gross margin expansion of 214bps, to 17.2 per cent, the highest level of the last four years. As a result, the company increased its adjusted EBITDA guidance, with the mid-point of $690 million higher than previous consensus estimates of $674 million. Investors reached well, sending the shares up 9 per cent on the day, to new 52-week highs. Maple Leaf’s valuation, at 7.8 times 2026 EBITDA is 30 per cent lower than peers, which is unwarranted in our view. Given the recent success and improved balance sheet, we see a good potential for valuation to re-rate higher.”
* TD Cowen’s Craig Hutchison raised his target for Lundin Mining Corp. (LUN-T) to $18 from $16 with a “buy” rating. The average is $16.66.
“Lundin shares outperformed [Thursday] (up 11 per cent) after reporting a solid Q2/25 beat from stronger sales volumes and cash costs,” said Mr. Hutchison. “Operations are tracking well to meet 2025 guidance, which makes the company a standout relative to its base metal peers. We reiterate LUN as one of our top picks in our coverage universe.”
* RBC’s Darko Mihelic cut his Manulife Financial Corp. (MFC-T) target to $49 from $51 with an “outperform” rating. The average is $47.92.
“MFC’s Q2/25 was a little light, earnings in Asia face headwinds, and the Comvest acquisition is marginally accretive. We caution some volatility may ensue until the assumption/strategic review ends. We are okay with the capital deployment and we do not expect a radical departure from its strategy (think tweaks). Like IAG, we believe capital deployment such as additional NCIBs can help MFC reach its medium-term target ROE of 18-per-cent-plus by 2027,” said Mr. Mihelic.
* RBC’s Harrison Reynolds hiked his OceanaGold Corp. (OGC-T) target to $28 from $25 with an “outperform” rating. The average is $25.30.
“OceanaGold is doing what many mining companies promise to do: deliver significant FCF to a healthy balance sheet with strategic optionality to allocate capital to the highest return avenues while providing leverage to gold without outsized execution or jurisdictional risk. We are incrementally upbeat following strong Q2 results demonstrating another quarter of operational delivery. In our view, OceanaGold Corp. is positioning itself as a compelling mid-cap gold producer that could be palatable to a wide array of investors. We believe the combination of tangible FCF, capital returns, and advancing growth projects can drive outperformance,” said Mr. Reynolds.
* BMO’s Ben Pham trimmed his target for Pembina Pipeline Corp. (PPL-T) to $57 from $59 with an “outperform” rating. The average is $59.50.
“PPL’s Q2/25 results were in line, 2025 guidance tightened, and $0.3-billion of new growth announced,” said Mr. Pham. “Furthermore, momentum is building on new developments not yet in our valuation that have positive reads for WCSB volumes and PPL: this includes $1-billion-plus of conventional pipe expansions and also the Greenlight project’s recent success in securing adequate transmission MW’s for an Alberta data center complex. Given that positive outlook, we maintain Outperform rating with target to $57 (vs. $59) on recent Alliance settlement/lower tolls.”
* Believing its “wireless thesis remains intact under new pricing discipline dynamics,” Desjardins Securities’ Jerome Dubreuil trimmed his Quebecor Inc. (QBR.B-T) target to $43 from $44 with a “buy” rating.
“We view the 5-per-cent share price drop on earnings day as slightly excessive, given 2Q25 was broadly in line when adjusting for one-time items,” said Mr. Dubreuil. “That said, with fears of industry disruption alleviating, some investors may feel less urgency to own the disruptor. Still, QBR’s wireless growth thesis is intact, as we expect it to keep gaining market share. In our view, stronger cable performance would help lift the stock back toward its all-time highs, although the path to achieving that improvement remains uncertain.”
* RBC’s Irene Nattel raised her Saputo Inc. (SAP-T) target to $37 from $35 with an “outperform” rating. The average is $31.
* RBC’s Maurice Choy bumped his target for South Bow Corp. (SOBO-T) to $39 from $38 with an “outperform” rating. Other changes include: ATB Capital Markets’ Nate Heywood to $35 from $34 with a “sector perform” rating and National Bank’s Patrick Kenny to US$26 from US$25 with a “sector perform” rating. The average is $34.81.
“While there were a number of positive updates related to Milepost-171 and the Blackrod Connection project construction, we like that South Bow has delivered another set of relatively predictable (and ‘no fuss’) quarterly results, particularly in light of its spin-off less than a year ago. Along with having both the deleveraging and post-spin-off transition plans being on track, we expect investor confidence in the delivery of South Bow’s dividend to be reaffirmed, with the stock offering the highest yield in our Canadian Energy Infrastructure coverage of around 7.5 per cent,” said Mr. Choy.
* National Bank’s Maxim Sytchev trimmed his Stella-Jones Inc. (SJ-T) target to $92 from $93 with an “outperform” rating. Other changes include: , while Desjardins Securities’ Benoit Poirier to $89 from $94 with a “buy” rating and RBC’s James McGarragle to $78 from $82 with a “sector perform” rating. The average is $86.13.
“In the last several quarters investor concerns centred around pricing in Poles, compounded by volumes,” said Mr. Sytchev. “Ties as well were weaker. With a $100-million top-line guide cut (most of the Street was around $3.6-billion), this is not a great set-up. At the same time, utility CAPEX expectations are ramping up, meaning Poles volumes will get better. SJ remains an inexpensive way to play the utility infrastructure game but clearly of a much slower growth calibre.”
* BMO’s Jeremy McCrea raised his Vermilion Energy Inc. (VET-T) target to $12 from $10.50 with a “market perform” rating. The average is $13.64.
“Vermilion has seen plenty of share price volatility as uncertainties surrounding European gas prices, leverage, A&D and exploration success all weigh on investor risk appetite. Despite these headwinds, VET remains steadfast in building a balanced portfolio of assets. Q2 was transformative for the company with the US and Saskatchewan divestments and portfolio high-grading. Furthermore, the production and cash flow beat, along with the reduction of Montney well costs, should be encouraging for investors. We are raising our target price ... to reflect the improved well economics and optimistic outlook,” said Mr. McCrea.