Inside the Market’s roundup of some of today’s key analyst actions
Ahead of the start of earnings season for Canadian banks late next week, National Bank analyst Gabriel Dechaine touted “conservatism as a catalyst” in a research report released Friday titled Performance anxiety.
“With higher provisions on the horizon, and loan growth that could stay low for an extended period, not to mention a sector trading at 11.2 times forward EPS on average, it is hard to get excited about the Big-6 banks,” he said. “We also believe expectations are disconnected from reality. Looking ahead to fiscal 2026, we see a few banks expected to generate double-digit growth, which appears to be a stretch considering the credit and loan volume headwinds facing the Group. Our 2026E are 4 per cent below consensus. So which stocks can outperform against this backdrop?
“In our opinion, the ‘credit overhang’ is a double-edged sword. On one hand, the negative one, we believe investors are wary of rising impairment levels and earnings downside risk presented by the credit cycle. On the other hand, the positive one, we believe that banks that do more to address this downside risk could be rewarded by the market. ... Q2/25 will be a litmus test for this view.”
Mr. Dechaine pointed to three key themes across the sector:
* The expectation for a rise in provisions for credit losses
Analyst: “We expect banks to build performing provisions at a faster rate than the 6 basis points quarterly average since Q3/22. We are forecasting 10 bps of performing provisions, though we would not be surprised to see them range from 5-15 bps. Moreover, we are looking for updated guidance on the timing of ‘peak PCLs’, which we believe could be pushed back to mid-to-late fiscal 2026.”
* A troubling loan growth outlook
Analyst: “We expect continued moderation of lending volumes, notably across the mortgage and commercial portfolios. The volatile economic environment has stifled credit demand, which may be reflected in more conservative outlook commentary from banks that have been ‘cautiously optimistic’ to date.”
* Capital markets representing a “sole bright spot”
Analyst: “U.S. bulge bracket firms reported strong wholesale results in their calendar Q1/25 results, notably in terms of trading revenue, and notably on the equity/derivatives desks. We note that this expectation is broadly shared in the market. Combined with the fact that investors occasionally dismiss the sustainability of trading revenue performance, we believe this driver could be discounted. The caveat here is that if banks use ‘excess’ trading revenues to bulk up their performing provisions, investors may take a more positive view.”
Mr. Dechaine made a EPS reductions to a pair of banks, leading to a reduction in his targets for their shares. They are:
- EQB Inc. (EQB-T, “sector perform”) to $111 from $117. The average target on the Street is $119.64.
- Laurentian Bank of Canada (LB-T, “underperform”) from $25 from $27. Average: $27.80.
He made these targets for these stocks:
- Bank of Montreal (BMO-T, “outperform”) at $144. Average: $146.13.
- Bank of Nova Scotia (BNS-T, “sector perform”) at $71. Average: $75.40.
- Canadian Imperial Bank of Commerce (CM-T, “outperform”) at $95. Average: $94.26.
- Royal Bank of Canada (RY-T, “outperform”) at $179. Average: $177.20.
- Toronto-Dominion Bank (TD-T, “sector perform”) at $80. Average: $90.13.
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Stifel‘s Martin Landry reduced his quarterly earnings expectations for Alimentation Couche-Tard Ltd. (ATD-T) after "tempering” his expectations for U.S. merchandise same-store-sales growth and U.S. comparable fuel volumes “in light of the muted growth reported by peers.”
In a research note released before the bell, the analyst said the U.S. convenience store industry “does not appear to have turned the corner and is still experiencing flat to declining traffic/basket trends.”
“We are revising downward our Q4FY25 U.S. merchandise SSS growth assumption to a decline of 0.5 per cent year-over-year, down from our previous forecast of flat growth,” said Mr. Landry. “This adjustment reflects continued softness in consumer spending, particularly among low-income households. Over the past six quarters, ATD has not recorded positive SSS growth in the U.S., as value-conscious consumers continue to trade down and reduce basket sizes. In its Q1/25 earnings call Murphy USA discussed static purchasing behavior across income cohorts. Similarly, 7-Eleven reported an average 0.8-per-cent year-over-year decline in U.S. merchandise SSS over the same period as ATD’s Q4FY25. These trends are also consistent with recent earnings reports from companies operating in adjacent categories, such as major quick-service restaurants and energy drink manufacturers.”
“We are lowering our Q4FY25 U.S. samestore fuel volume growth assumption to down 1.5 per cent year-over-year, down from our prior estimate of down 1.0 per cent. This revision is informed by industry read-through, including 7-Eleven’s reported average decline of 2.4 per cent in retail gallons sold per store during the period corresponding to ATD’s Q4FY25 results. Additionally, Murphy USA reported a 4.2-per-cent year-over-year decline in same-store fuel volumes for Q1/25, which ended on March 31st. Murphy USA’s results, however, were partially impacted by the timing of the Easter holiday. This calendar effect won’t influence Couche-Tard’s Q4FY25 performance.”
Also raising his expense forecast due to “increased investments in technology aimed at enhancing inventory management, reducing stockouts, and minimizing waste,” Mr. Landry cut his earnings per share forecast for the quarter by 9 cents to 47 cents, which is 1 cent less than the result during the same period a year ago.
Keeping his “buy” recommendation for Couche-Tard shares, Mr. Landry also reduced his target to $82 from $84, citing the recent strength of the Canadian dollar. The average is $82.37.
"Short term, we expect ATD’s shares to be range-bound given difficult operating trends and the potential 7&i acquisition, which creates an overhang," he said.
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Emphasizing its performance on its cost-cutting initiative, CIBC World Markets analyst Krista Friesen upgraded AutoCanada Inc. (ACQ-T) to “neutral” from “underperform” previously.
“ACQ reported solid Q1 earnings coming in ahead of our and consensus expectations. While this was a good quarter, we suspect it benefited from some tariff-driven, pull-forward in sales in the month of March,” she said. “With that said, our focus heading into the quarter was on what ACQ would be able to accomplish on its cost-cutting plan. We were admittedly skeptical of the aggressive targets set forth by the company; however, the company exceeded its target of $36-million in run-rate savings by the end of Q1, achieving $57-million by the end of the quarter.”
“While ACQ has set cost-cutting initiatives in the past, what set this quarter apart was the company’s ability to execute. The company accelerated its cost transformation efforts under the ACX Operating Method, delivering an additional $48.1-million in annualized savings in Q1, and bringing total annualized run-rate savings to $57.1-million (versus its forecast of $36-million provided during Q4 reporting) since the plan’s launch in September 2024. While the company noted that given the need to maintain stable operations during execution, the remaining initiatives are more complex and less likely to be accelerated, it demonstrated ACQ’s ability to not only implement cost-saving measures but also to do so at an accelerated pace, which enhances our confidence in its ability to successfully achieve its targets and improve operational efficiency.”
Ms. Friesen hiked her target for the Edmonton-based company’s shares to $23 from $15. The average is $19.60.
“While we believe the company’s demonstrated ability to cut costs warrants an upgrade, we fall short of upgrading the name to an Outperformer rating given the macroeconomic uncertainty facing the industry,” she noted. “We highlight that a contributing factor for the company’s outperformance in Q1 was a pull-forward of demand due to tariffs. With the company noting emerging signs of consumer fatigue, there continues to be significant uncertainty in the industry, as well as a lack of clarity on whether this demand pull-ahead will lead to softness later in the year.”
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Citing uncertainty in commercial vehicle markets and the timing of its battery materials investment, National Bank Financial analyst Rupert Merer lowered his rating for NanoXplore Inc. (GRA-T) to “sector perform” from “outperform” following the late Tuesday release of its third-quarter results.
"GRA reported mixed Q3′25 results, with economic uncertainty in North American markets connected with recent tariff threats from the U.S.," he said. “Roughly 70 per cent of GRA’s sales are tied to the transportation sector and concentrated with some large customers. However, with cost control and the benefit of grants and refundable tax credits (reported in other income), its earnings beat.”
The Montreal-based graphene company reported quarterly revenue of $30.4-million, down 10 per cent year-over-year and falling short of the $35.3-million estimate of both Mr. Merer and the Street, which he attributed to “with order delays and push-outs for its transportation customers (roughly 70 per centof GRA’s market) with economic uncertainty impacting GRA’s large commercial vehicle customers.” However, adjusted EBITDA of $1.4-million exceeded both the analyst’s $1.3-million projection and the consensus of $1-million driven by the benefit of tax credits and grants.
Given the mixed results and market uncertainty, NanoXplore cut its full-year revenue guidance to $130-million (from $140-155-million).
“GRA continues its 5-year strategic plan, which includes approximately $140-million in investments towards battery materials and graphene-enhanced SMC plants,” he said. “Equipment installation is ongoing at the expanded St. Clotilde-de-Beauce SMC facility, though incremental production is delayed to FQ1’26E (was Q4’25E), due to reduced demand. First production at its new North Carolina SMC could come in FQ1′26E to support program launches, though also with some delays to timing. Government funding for its CSPG and dry graphene initiative is still awaiting Hydro Quebec’s power connection approval; prompting GRA to consider alternative expansion options (updates expected in Q4′25E). GRA highlighted progress in developing graphene markets (including the drilling fluid and insulation market) and could begin commercial activities soon.
“GRA finished Q3 with $31-million liquidity ($21-million in cash). Leveraging its healthy financial position, GRA plans to fund its capex for its five-year plan through its long-term credit facility and government support, highlighting no additional equity needs.”
After dropping his revenue forecast through fiscal 2026 and adjusting his projections to account for the results, Mr. Merer trimmed his target for the company’s shares to $2.80 from $3. The average target is $3.86.
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National Bank Financial analyst Maxim Sytchev sees AtkinsRéalis Group Inc. (ATRL-T) “getting more predictable, on balance.”
Shares of the Montreal-based firm jumped 10.9 per cent on Thursday after it reported revenue for the quarter of $2.546-billion, above both Mr. Sytchev’s estimate at $2.264-billion and the Street’s forecast at $2.398-billion). Consolidated EBITDA came in at $214-million also topped projections ($176-million and $205-million, respectively) due to “more pronounced (than expected) Nuclear revenue.”
“On balance, this is a good start to the year, driven by nuclear; engineering growth will resume given backlog additions that we saw this quarter,” the analyst said. “Cash from the 407 sale will, of course, only further solidify the balance sheet while also dramatically simplifying the reporting / analytical structure of the company, hopefully driving down the discrepancy between Atkins’ valuation and that of its direct peers. Stock’s move upward [Thursday] morning is deserving, in our view, but maybe not the entire 12 per cent. Further re-rate is a function of multiple expansion, supported by NCIB and resumption of growth in the engineering space.”
Raising his earnings expectations and valuation multiple given “the magnitude and visibility of growth has strengthened” for its Nuclear business, Mr. Sytchev emphasized “nuclear carries the torch in Q1; engineering to get the baton in H2.”
“Nuclear momentum continues in full force,” he said. “With over $5-billion in backlog for the business, revenue visibility continues to get even stronger as sentiment continues to improve on the sector following over a decade of avoidance/disdain. While procurement work carries a lot of pass-through revenues and lower imbedded margins, the magnitude of growth more than offsets this minor drag. MONARK development continues in full force, with around 300 engineers involved in the project and $31-million of CapEx in the quarter, and is scheduled for commercial availability by the end of 2027E; the Canadian government has been a supportive partner in the technology’s development. Lastly, the U.S. Nuclear business has formed a JV with professional services firm Strata-G, which should enable the pursuit of additional DoE opportunities.
“ESR growth to be H2/5E anchored. Despite the 4-per-cent organic top-line retraction in the quarter on tough comps and project completions, management is confident in achieving the 7-9-per-cent target for the full year on a strong second half. In the U.S., underlying growth remains strong as IIJA fund flows (now 1/3 disbursed) have not been interrupted while macro-related delays/disruptions have been minor thus far. Management continues to work on scaling the Canadian business in Ontario and out west, and is confident in achieving an improvement in full-year margins. Middle East revenues are likely to be flat year-over-year given recent funding pullbacks in Saudi Arabia (little desire to increase exposure further here). In the UK and Ireland, water and defense remain the primary growth anchors.”
Keeping an “outperform” rating for its shares, Mr. Sytchev increased his target to $92 from $88. The average is $92.77.
Elsewhere, others making target adjustments include:
* TD Cowen’s Michael Tupholme to $106 from $95 with a “buy” rating.
“We are encouraged by the Q1/25 PS&PM EBITDA beat, ATRL’s record backlog and increased Nuclear revenue guidance for 2025 and 2027,” he said. “Although Q1/25 ESR performance was soft, ATRL remains confident of achieving its 2025 ESR targets (supported by ESR’s record backlog). We remain positive on ATRL’s outlook and see its valuation as attractive (despite recent share-price gains). ATRL remains our top pick.”
* Desjardins Securities’ Benoit Poirier to $100 from $98 with a “buy” recommendation.
“Today’s share price reaction (up 11 per cent) came as a pleasant surprise,” said Mr. Poirier. “Although Engineering Services faced a tough year-over-year comparison (due to three projects), Nuclear momentum (backlog up 64 per cent quarter-over-quarter) and greater clarity on capital deployment were very well-received. While our 2025 forecast already assumes 6.6 million of share repurchases (of 13.3 million possible), we still expect ATRL to end 2025 with negative leverage, leaving room for further capital deployment (M&A and buybacks) and value creation.”
* Raymond James’ Frederic Bastien to $110 from $105 with an “outperfofrm” rating.
“It may take some time before AtkinsRéalis’ engineering practice is up-to-snuff versus WSP Global or Stantec, but the firm possesses something its Canadian peers don’t—an enviable nuclear business that is firing on all cylinders. So much so, it powered better-than-expected results and a record backlog of $5 bln for 1Q25, compelling management to raise its financial targets for the near and medium term. Keeping ATRL’s exclusive CANDU license, strong balance sheet and above-average growth prospects in mind, we reaffirm our Outperform rating and raise our target price,” said Mr. Bastien.
* RBC’s Sabahat Khan to $102 from $92 with an “outperform” rating.
“Overall, given the record backlog, strength in Nuclear, and various global tailwinds in Engineering Services Regions that management outlined, we believe AtkinsRéalis remains well-positioned for 2025+,” he said.
* ATB Capital Markets’ Chris Murray to $105 from $100 with an “outperform” rating.
“We remain constructive on ATRL and would remain buyers after today’s rally given the robust outlook for Nuclear combined with expectations for stronger ES growth in H2/25,” said Mr. Murray.
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In other analyst actions:
* In a report titled Simmering, Not Yet Sizzling, RBC’s Ryland Conrad initiated coverage of MTY Food Grpup Inc. (MTY-T) with a “sector perform” rating and $51 target. The average is $50.75.
"MTY is a leading franchisor of restaurants in North America with more than 7k locations across 85 diversified banners. While we see value in the stock at current levels, we are looking for more timely entry points and incremental visibility around the company’s ability to generate more meaningful organic growth alongside any easing of macro headwinds," he said.
* In response to its agreement with Strathcona Resources to acquire its Kakwa assets for all-cash consideration of $1.6-billion, National Bank’s Travis Wood raised his ARC Resources Ltd. (ARX-T) target to $35 from $33, maintaining an “outperform” rating. Other changes include: RBC’s Michael Harvey to $34 from $32 with an “outperform” rating, ATB Capital Markets’ Patrick O’Rourke to $33.50 from $31 with an “outperform” rating and Desjardins Securities’ Chris MacCulloch to $35.50 from $34.50 with a “buy” rating. The average on the Street is $32.85.
“Although somewhat material, the tuck-in style and asset fit should make this somewhat of an easy integration for the company,“ said Mr. Wood. ”Based on our estimates and the all-cash nature of the deal, our CFPS is up 10 per cent, while our FCF is up less than the company points to given what may be our higher than anticipated capital spending across the newly acquired asset next year (near $200-million). Broadly, it makes sense, with synergies likely to come from infrastructure optimization as well as scale itself."
* National Bank’s Maxim Sytchev cut his Bird Construction Inc. (BDT-T) target to $28 from $30 with a “sector perform” rating, while Stifel’s Ian Gillies moved his target to $34 from $34.50 with a “buy” rating The average is $32.19.
“We’ve been fielding many questions around the reason(s) for BDT’s recent share price moves,” he said. “Year-to-date shares are down 4 per cent vs. TSX at up 4 per cent but the amplitude has been pretty wide. We did not have the mental (or more precisely psychological) fortitude to upgrade in April when shares hit $18.00; now with the stock having moved up, we are back to square one – relatively expanded valuation (on solid execution, mind you) and another missed opportunity, balanced with a H2/25E-weighted outlook.”
* TD Cowen’s Aaron MacNeil raised his Keyera Corp. (KEY-T) target to $47 from $45. Other changes include: Raymond James’ Michael Barth to $51 from $50 with an “outperform” rating, Scotia’s Robert Hope to $51 from $50 with a “sector outperform” rating and National Bank’s Patrick Kenny to $43 from $41 with a “sector perform” rating. The average target is $46.32.
"Keyera posted another strong quarter with its core infrastructure assets continuing to see solid growth,“ said Mr. Hope. ”The KFS frac III was formally sanctioned, which was not a surprise, and other projects, including KAPS Zone 4, appear to be making significant progress. KFS III gives greater visibility to the company’s fee-based growth outlook. Our target price increases $1 to $51 to reflect the value of the KFS III project. The shares were weak following the quarter, which we attribute to the 2025 Marketing guidance of $310-$350-million being lower than some expected with consensus at $349-million (though in-line with our estimates). Our go-forward estimates do not materially move.
“Keyera remains one of our favourite midstream names given it has: low leverage (management forecasts 2.0 times adjusted debt to EBITDA at Q1/25 vs. target of 2.5-3.0 times); (2) a low payout ratio (66 per cent in 2025 vs. target of 50-70 per cent); (3) volume growth driving improving returns on existing assets, and (4) new project announcements
* National Bank’s Zachary Evershed cut his target for shares of Mattr Corp. (MATR-T) to $14 from $19, keeping an “outperform” rating, while Stifel’s Ian Gillies raised his target to $14 from $12 with a “buy” rating. The average is $15.56.
"While we are disheartened by another round of cuts as tepid end market demand pushes MATR’s post-MEO ramp up to the right, we highlight that the risk/reward dynamic at current valuations remains appealing, with exposure to high growth end markets such as data centres and the nuclear renaissance, with certifications in light water and SMR being pursued to round out the portfolio beyond CANDU,“ he said. ”We reiterate our Outperform rating as we believe the long-term thesis remains intact and that patience will (eventually) be rewarded."
* National Bank’s Matt Kornack increased his target for units of Nexus Industrial REIT (NXR.UN-T) to $7.25 from $6.75 with a “sector perform” rating, while Raymond James’ Brad Sturges bumped his target to $8.50 from $8.25 with an “outperform” rating. The average is $8.11.
"NXR put up solid operating metrics in Q1 and completed its transition to a pure-play industrial REIT with less than a handful of office and retail properties remaining," he said “The quarter came in slightly ahead of our estimates when adding back one-time transaction-related adjustments. Management maintained their outlook for mid-single-digit organic growth with a strong start from the Ontario portfolio, where known leasing contributed to a positive print (100-plus-per-cent leasing spreads), tenants currently in CCAA processes will dent this a bit in Q2 but leasing at development/expansion sites will be an offset. Trade remains a risk but for now the tone of discussions has been a little more favourable.”
* Mr. Kornack also increased his target for Pro REIT (PRV.UN-T) to $5.50 from $5 with a “sector perform” rating. Other changes include: Raymond James’ Brad Sturges to $6 from $5.75 with an “outperform” rating and TD Cowen’s Sam Damiani to $5.50 from $5 with a “hold” rating. The average is $5.78.
"PRO reported solid Q1 results to begin the year, with stable occupancy and better-than-expected rent spreads on industrial leasing,“ he said. ”The Winnipeg transaction will establish the framework for an ongoing strategic relationship that could be leveraged for future growth and speaks to creativity and platform value in a period of time when public markets remain largely closed/punitive on valuations. Q1 results are supportive of management’s outlook for NOI growth with the geographic exposure and asset type looking well positioned in the context of a more uncertain macro environment."
* RBC’s Pammi Bir raised his Sienna Senior Living Inc. (SIA-T) target by $1 to $19 with an “outperform” rating. The average is $19.33.
“Post largely in-line Q1 results, we believe SIA continues to setup well amid ongoing equity market anxiety. The uptick in 2025 retirement SP NOI growth guidance is encouraging, as the benefits of operational strides and robust fundamentals continue to surface. Significant enhancements in govt funding and improved cost controls have also put the LTC platform on stronger footing to deliver steady, moderate organic growth. A more active pace of capital deployment is also moving portfolio quality up the curve. In short, we think valuation is wellsupported,” said Mr. Bir.
* Desjardins Securities’ Benoit Poirier increased his Stantec Inc. (STN-T) target to $153 from $148 with a “buy” rating. Other changes include: RBC’s Sabahat Khan ( to $150 from $138 with an “outperform” rating, TD Cowen’s Michael Tupholme to $165 from $145 with a “buy” rating, ATB Capital Markets’ Chris Murray to $145 from $140 with a “sector perform” rating, Stifel’s Ian Gillies to $156 from $143 with a “buy” rating, Scotia’s Jonathan Goldman to $146 from $144 with a “sector outperform” rating and National Bank’s Maxim Sytchev to $147 from $144 with an “outperform” rating. The average is $143.91.
“We have increased our estimates to account for the Page and Ryan Hanley acquisitions. Following the solid start to the year, in addition to the contribution from the acquisitions and the unchanged demand backdrop (insulation from U.S. budget cuts), we are now quite confident that STN would increase its guidance when it reports in August,” said Mr. Poirier. “We now forecast 6.8-per-cent organic growth driving net revenue of $6.6-billion (12-per-cent growth), EBITDA of $1.126-billion (17.1-per-cent margin) and EPS of $5.25 (19-per-cent year-over-year growth) in 2025.”
* Raymond James’ Steve Hansen increased his Superior Plus Corp. (SPB-T) target by $1 to $10.50, exceeding the $9.95 average, with an “outperform” rating.
“We are bumping our target ... on Superior Plus Corp. (SPB) based upon: 1) the company’s solid 1Q25 print; 2) robust ‘Superior Delivers’ progress; 3) wide-ranging CNG growth opportunities; 4) accelerating buybacks; and 5) the stock’s heavily discounted valuation,” he said.