Inside the Market’s roundup of some of today’s key analyst actions
RBC Dominion Securities analyst James McGarragle thinks Air Canada (AC-T) diversification has become “a key differentiator in an uncertain backdrop.”
That led him to raise his recommendation to “outperform” from “sector perform” following Friday’s release of stronger-than-anticipated first-quarter results, which sent its shares soaring 14.6 per cent.
“Key for us from Q1 is that management navigated a significant drop in transborder demand effectively, which demonstrates AC’s diverse network and its ability to adapt quickly to an evolving environment, which we believe is going to drive a re-rate higher in the shares,“ said Mr. McReynolds. ”Moreover, while we continue to discount heavily our out-year FCF estimates, these estimates call for a meaningful FCF inflection, which we now discount ‘less heavily’ following very strong operating performance in Q1 and which screens extremely attractive following recent weakness in the shares.”
Air Canada reported revenue for the quarter of $5.2-billion, falling in line with Mr. McGarragle’s estimate despite a year-over-year decline in capacity of 0.4 per cent, which fell below his expectations of a flat result. EBITDA of $387-million blew past his $312-million estimate, due, in part, to margins of 7.4 per cent, exceeding his 6-per-cent projection driven by strong cost controls.
“AC is taking steps to manage costs in a tough operating backdrop, which was evident in CASM-ex coming in much lower than consensus in Q1,” he said. “This gives us confidence in the team’s ability to achieve full-year cost guidance, which implies strong cost reduction during the remainder of the year. Overall, we believe this significantly reduces downside risk related to weakness in transborder demand, which was a key driver of our prior cautious view coming into the quarter.
“Out-year FCF inflection compelling. We have always viewed Air Canada’s out-year FCF inflection as compelling, with FCF yields of more than 30 per cent and more than 50 per cent on our 2028 and 2029 estimates, respectively. That said, we believe those estimates need to be discounted heavily given a lot can happen over the next 3-4 years. However, Q1 results give us increased confidence in the team’s ability to navigate an uncertain outlook, and we therefore discount ‘less heavily’ the company’s out-year FCF inflection. All that to say, we see risk/reward skewed heavily toward reward.”
While acknowledging airline profitability is “very sensitive to changes in macro” and demand trends remain “a key risk going forward,” Mr. McGarragle hiked his target for Air Canada shares to $25 from $16. The average target on the Street is $23.40, according to LSEG data.
“We came away positive on Q1 results and are taking our estimates higher, despite the company lowering its guide, as we already built in demand headwinds and to reflect strong cost control,“ he explained. ”Our 2025 estimate increases to $3.3-billion (from $3.2-bilion) versus guidance for EBITDA of $3.2-3.6-billion. Our 2026 estimate also moves up on fuel. Key for us is that we expect Q1 performance to drive a re-rate in the shares and have therefore increased our target multiple to 4 times (from 3.3 times), a premium versus historical given solid performance in a tough backdrop.”
Elsewhere, others making target changes include:
* National Bank’s Cameron Doerksen to $24 from $23 with an “outperform” rating.
“We acknowledge that demand for air travel and yields may be impacted by the current economic uncertainty, but so far demand for air travel outside of routes to the U.S. is holding up relatively well,” said Mr. Doerksen. “We also highlight that based on current prices, lower jet fuel costs and the recent strengthening of the CAD are two potential earnings tailwinds.
“Our view remains that Air Canada shares are already pricing in a downturn in air travel demand.”
* Stifel’s Daryl Young to $23 from $22 with a “buy” rating.
“Looking forward, management’s outlook was broadly positive, noting bookings/yields/load factors remain stable through Q2/Q3, albeit with a differing mix of destinations,” he said. “U.S. Transborder is understandably weak (tariffs plus weaker C$) but not falling off a cliff (bookings have stabilized at down low-teens). Moreover, this is largely being offset by favourable demand for highly profitable long-haul international destinations. At the same time AC is managing costs well and using delays in new aircraft deliveries to act opportunistically on share repurchases with a new $500-million SIB (while keeping leverage less than 2.0 times). We acknowledge that the Canadian consumer remains very stretched, but it does not appear to be impacting the near-term, plus tariff-related uncertainty may be passing peak, setting the stage for AC shares to claw-back their valuation.”
* Scotia’s Konark Gupta to $24 from $21 with a “sector outperform” rating.
“We still remain conservative due to uncertainties around macro and Canadian travel demand,” said Mr. Gupta. “While Q1 was negatively impacted by various headwinds, yield remained positive and AC expects stable yields through Q3, aided by more disciplined capacity growth. It is also witnessing stable booking trends as transborder weakness is offset by strength in other markets. Management is making efforts to reduce/defer costs and capex, which along with delays in aircraft deliveries, are helping preserve strong liquidity and supporting incremental buybacks. We believe AC remains well-positioned to navigate short-term uncertainties and to recapture growth lost during the pandemic over the long term.”
* Canaccord Genuity’s Matthew Lee to $27 from $24 with a “buy” rating.
“Air Canada reported Q1 results last week with numbers above Street expectations. Our biggest takeaway from the quarter was the firm’s EBITDA guidance, which was cut by $200-million but was still better than many investors expected. In our view, management is expertly navigating geopolitical turmoil by 1) repositioning its network towards high-demand destinations, 2) controlling cost with its efficiency program expected to generate $150-million in savings this year, and 3) harnessing its balance sheet through the repurchase of shares. Nevertheless, management remained cautious on the F25 outlook with its guidance reduction coming despite bookings being up $1-billion sequentially, largely in line with our expectations. Along with the quarter, AC announced the repurchase of $500-million in shares, which will bring its share count down to 300 million, the 2028 target set out in its investor day. In our view, this was both opportunistic and value generative, suggesting that AC’s near-term visibility is perhaps better than investors give it credit for. While the carrier is certainly not out of the woods yet, we continue to view AC’s current valuation as attractive given its position in the Canadian market, solid balance sheet, and effective cost management.”
* CIBC’s Kevin Chiang to $24 from $21 with an “outperformer” rating.
“AC’s reported Q1 reaffirmed our view that its network reach and diverse revenue stream have created a more resilient earnings profile. While the airline is seeing pockets of weakness, especially into U.S. leisure destinations, the airline has been successful in redeploying capacity into more profitable markets. We continue to view AC as a deep value name,” said Mr. Chiang.
* ATB Capital Markets’ Chris Murray to $31 from $32 with an “outperform” rating.
“AC is relatively well-positioned for the current environment given its diversified international network, healthy demand conditions domestically, and increased buyback activity in Q2/25, keeping us constructive on its outlook,” he said.
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Citing its weaker growth assumptions, ATB Capital Markets analyst Martin Toner lowered Docebo Inc. (DCBO-T, DCBO-Q) to a “sector perform” recommendation from “outperform” previously, despite the release of first-quarter results that exceeded the Street’s expectations.
TSX-listed shares of the Toronto-based software company plummeted 17.1 per cent on Friday after reduced its guidance for the current fiscal year, seeing subscription revenue growth of 10-11 per cent (from 11.5-12.5 per cent), total revenue growth between 9-10 per cent (from 11-12 per cent) and adjusted EBITDA margin between 17-18 percent (from 18-19 per cent).
It attributed the changes to continued macro-economic headwinds that will affect its small and medium sized business and lower mid-market customers as well as a seven-figure negative impact to its annual recurring revenue base resulting from Amazon Web Services terminating an agreement.
Mr. Toner called the loss of AWS as “unfortunate but not systemic.”
“Given DCBO’s high rate of growth in 2021, there was a 75-per-cent year-over-year increase in contracts up for renewal,” he explained. “The company emphasized that Q1/25 was the highest renewals quarter it has ever experienced. This surge in renewals is attributed to a large number of 3-year-old contracts reaching the end of their term. AWS, accounting for 1.8 per cent of total ARR, informed management during the quarter that it will not renew its Skills Builder contract (expiring December 31, 2025) as they opt to build an internal solution. According to management, the decision reflects AWS’s strategic preference for in-house development, not a shift to a competing vendor. AWS uses Docebo for three smaller, low six-figure ARR contracts in other departments, with renewals coming up over the next three years. Management believes that these are unlikely to move to internal solutions due to their smaller scope. We estimate the impact of the Amazon loss will be a $4-million headwind for ARR in Q4/25. According to the non-renewals were very close to their estimate, within reasonable levels and overall retention is strong.”
With the lower guidance, Mr. Toner cut his 2025 and 2026 adjusted EBITDA estimates, leading him to drop his target for its shares to $45 from $75. The average is $58.78.
“We are no longer confident that Docebo can reaccelerate revenue growth back to the 20-per-cent-plus range and have lowered our long-term revenue growth estimates,” he said. “At a valuation of 18 times EV/EBITDA, we believe Docebo is too expensive for most value investors and is no longer an attractive growth stock. When compared to other profitable mid-cap North American SaaS names, Docebo appears relatively fairly valued.”
Elsewhere, National Bank’s Richard Tse downgraded Docebo to “sector perform” from “outperform” and dropped his target to US$35 from US$45.
“While the ... results were in line, guidance was not, care of the uncertain macro that’s impacting sales cycles,” said Mr. Tse. “But even beyond the macro, what’s also impacting valuation is the lack of consistent execution. Instead, what we’ve seen over the past year are a number of one-offs such as changing target market (small to large), leadership stock sales and executive changes. So while the macro backdrop may be a fair explanation for the downward guidance revision for the year, it does not take away from the negative valuation re-rating caused by those one-offs.
“Despite [Friday’s] meaningful pullback in the stock price, we think the risk-to-reward profile against the above has become balanced until we see a more consistent trajectory in execution, despite the macro. As such, we’re downgrading to Sector Perform.”
Meanwhile, others making target changes include:
* Canaccord Genuity’s Robert Young to US$43 from US$48 with a “buy” rating.
“Given a more uncertain macro outlook and higher levels of deal scrutiny, Docebo took a more conservative stance on its full-year outlook for 2025,“ he said. ”At the same time, Docebo announced the loss of a marquee customer contract with Amazon AWS contributing $4-million ARR. The Q1 headline metrics were ahead of expectations but marred by ARR below our model. Management countered concerns of churn, but did not provide any metrics. The company continues to curate a healthy pipeline with growing deal size and higher SI engagement and has begun to build a FedRAMP pipeline post its placement in the FedRAMP marketplace. Following a selloff, Docebo trades at 3.1 times C25E EV/Sales, which we believe is an attractive entry point for a ‘Rule of 30′ company. We have made downward revisions to our estimates to reflect the Q1 and F2025 guidance.”
* Stifel’s Suthan Sukumar to US$42 from US$52 with a “buy” rating.
“While optics are poor, we don’t believe there are structural issues. Growing caution given increased macro uncertainty remains a key factor for consecutive outlook cuts, while management departures appear to be more of growing pains, and we see the AWS use-case loss as a one-off. We believe our thesis for Docebo’s competitive differentiation and ability to sustain enterprise share gains still holds, supporting a view for more consistent growth ahead, but given the pullback, we can’t help but think they are now a more attractive takeout target to PE/strategics when considering their leading market position, recurring revenues, and cash-flows,” he said.
* Scotia’s Kevin Krishnaratne to US$40 from US$45 with a “sector outperform” rating.
* CIBC’s Stephanie Price to US$37 from US$48 with an “outperformer” rating.
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National Bank Financial analyst Richard Tse raised his rating for Telus International Inc. (TIXT-Q, TIXT-T) to “outperform” from “sector perform” following “solid” first-quarter results and full-year guidance, citing its valuation and seeing “an inflecting outlook following a number of years of continuing declines.”
“While that’s not to say the underlying model will have margins reverting to previous levels, it appears the Company is executing to recast its services towards growth markets, which we think sets up for improving numbers looking ahead,” he added.
n Friday before the bell, the Vancouver-based company, a subsidiary of Telus Corp. (T-T), reported quarterly revenue of $670-million, exceeding the $650-million projection from both Mr. Tse and the Street. Adjusted EBITDA of $90-million also topped expectations ($88-million).
Telus International also reiterated its 2025 goal of 2-per-cent organic growth. That implies revenue of $2.711-billion and an adjusted EBITA margin of 14.8 per cent, falling in line with estimates.
“All in, we believe FQ1’25 was a solid quarter relative to expectations with increasing stabilization across a number of business segments where the Company’s top five largest customers grew both sequentially and year-over-year, including its large social media customer (in our opinion, Meta), which grew year-over-year after continued declines in FY24,” said the analyst. “At 4.1 times EV/Adj. EBITDA (after adding back SBC) on FY25 estimates; we see an attractive risk-to-reward profile.”
Mr. Tse raised his target to US$3.50 from US$3. The average target is US$6.72.
Elsewhere, other target adjustments include:
* Stifel’s Suthan Sukumar to US$4 from US$5 with a “buy” rating.
“TIXT reported better Q1 revenues relative to expectations, underscoring better-than-expected stability across the business with respect to demand, pricing, and the competitive backdrop, with in-line EBITDA performance, highlighting a stable base of margins to build from as the company balances higher growth investments with profitability as they navigate a transitioning industry with a greater focus on AI-led capabilities and higher-value opportunities. Net/net, with a reaffirmed FY guide, this quarter helps to reaffirm our thesis for TIXT’s ability to sustain share gains vs. peers with both new and existing clients, supporting a recovery in organic growth rates. With valuation at trough levels (4.7 times C26E EBITDA), we continue to see risk to the upside,” he said.
* Canaccord Genuity’s Aravinda Galappatthige to US$6 from US$5.50 with a “speculative buy” rating.
“TELUS International’s (renamed TELUS Digital) Q1/25 report was slightly better than expected in terms of headline financial metrics, and guidance was unchanged. While there are hints of broader industry conditions improving following an extended trough, TIXT’s Trust & Safety segment remains an area of focus and potential downside risk. Competitive conditions and pricing across the segments remain fluid. We continue to rate TIXT as SPECULATIVE BUY,” said Mr. Galappatthige.
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Desjardins Securities analyst Chris MacCulloch said he’s reducing his “level of concern” on NuVista Energy Ltd. (NVA-T), raising his recommendation for its shares to “buy” from “hold” following last week’s release of “strong” first-quarter results that led to positive revisions to his forecast.
“Among the small/mid-cap producers within the Desjardins E&P coverage universe, the company increasingly stands out as providing both a robust organic growth profile and competitive capital returns, even with the backdrop of softer oil prices, all while retaining one of the strongest balance sheets in the sector,” he said.
While acknowledging the macro headwind from softer condensate prices, Mr. MacCulloch said he believes “NVA retains an attractive return profile, targeting 7–10-per-cent growth, coupled with a shareholder-friendly capital allocation backstopped by a commitment to repurchase at least $100-million of stock this year.”
“Based on current strip prices, we see the company outpacing its commitment, remaining on track to deliver $130-million of buybacks in 2H25, with a similar pace expected next year contributing to a 21-per-cent total shareholder return profile in 2026, which is best in class within the Desjardins E&P coverage universe,” he said. “That is before NVA dips into the balance sheet to supplement buybacks, which it could do temporarily to the extent that net debt is sitting $80-million below the soft $350-million target. More importantly, we believe the company’s ambitious growth plans are structurally well-supported as WCSB heavy oil production continues ramping from the oil sands and Clearwater, which is expected to support condensate demand (for diluent) in perpetuity. For all the above reasons, we continue to view NVA as a highly attractive takeout candidate by a larger entity seeking additional Montney resource.”
Mr. MacCulloch’s target for NuVista shares moved to $17 from $16.50. The current average is $16.96.
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In a separate note, seeing its “solid” quarterly results “giving credence to a Clearwater revival story,“ Mr. MacCulloch also raised Tamarack Valley Energy Ltd. (TVE-T) to a “buy” recommendation from “hold” previously.
“After stepping back from most of our oil-weighted, small/mid-cap coverage universe in mid-March on the back of a more bearish oil price outlook, we have warmed up to the TVE story as returns to target have increased, primarily on the back of exceptional operational performance,” he said.
“Specifically, we have trimmed our operating and capex assumptions while recent Charlie Lake well results and successful waterflood implementation in the Clearwater supported an increased production forecast. On that note, while improved operational performance has trimmed the historically wide valuation discount vs Headwater Exploration in recent months, we believe there is scope for further tightening relative to the current 1.6 times delta (2026E EV/DACF) based on current strip prices.”
The analyst thinks “there is scope for further efficiency improvements as the company doubles waterflood injection capacity to 30,000 bbl/d by year-end” after the Calgary-based company posted “another operationally driven cash flow beat, complemented by reduced capex and increased production expectations.”
“TVE appears to be carefully managing Street expectations ahead of its June 25 investor day, which is expected to include an updated five-year plan, including revisions to capex and production growth, along with details on its recent land swap with Baytex Energy for additional acreage at Seal and in the Charlie Lake,” he said. “Bottom line, we believe recent market volatility has created an attractive entry point for investors seeking heavy oil exposure from a producer which has enhanced returns through efficiency improvements, as shown by its sub-US$40/bbl WTI break-evens.”
His target rose to $5.25 from $5. The average is $5.64.
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Desjardins Securities analyst Kyle Stanley said “it is difficult to recommend allocating new capital” to European Residential Real Estate Investment Trust (ERE.UN-T) given the limited potential return to his target of $2.75 per unit.
Accordingly, he lowered his recommendation for the Toronto-based REIT, which focuses on multi-residential real estate properties in the Netherlands, to “hold” from “buy” as the disposition of its portfolio continues.
“Residential portfolio SP [same property] revenue growth of 0.7 per cent year-over-year was negatively impacted by 540 basis points year-over-year of occupancy loss as suites continue to be held vacant to facilitate the wind-down process,” he said. “SP AMR [average monthly rent] growth and blended leasing spreads remained healthy at 6.2 per cent year-over-year and 19.5 per cent year-over-year, respectively.
“Formal bid process sets some parameters. We view a competitive bidding process as the most desirable way to maximize unitholder value in a time-efficient manner, while offloading some administrative dealings to the brokers CBRE and Rubens Capital. We believe the decision to transition to a competitive process indicates a healthy level of existing interest in the remaining asset base, which gives us confidence that a transaction can occur in short order following the 3Q25 bid date.”
Mr. Stanley said he sees upside if bids as part of the formal bidding process come in ahead of his $3 per unit estimate of portfolio value, or transaction costs/taxes are below our 25 cents per unit estimate.
“We believe early interest in the remaining portfolio has been encouraging, with the final bid date in 3Q25 now offering investors a definite timeline,” he noted.
His target remains $2.75. The average is $2.88.
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In other analyst actions:
* Raymond James’ Steve Hansen upgraded Decisive Dividend Corp. (DE-X) to “outperform” from “market perform” with a $8 target, up from $7. The average on the Street is $8.13.
“We are increasing our target price on Decisive Dividend (Decisive) to $8.00 (vs. $7.00 prior) and upgrading our rating back to Outperform (vs. Market Perform prior) based upon the company’s: 1) solid 1Q25 print; 2) improving order activity and backlog; 3) advanced M&A pipeline; and 4) attractive total return prospects,” he said.
* Seeing it “turning the corner as a pure-play utility,“ RBC’s Nelson Ng raised his target for Algonquin Power & Utilities Corp. (AQN-N, AQN-T) to US$6 from US$5.50 with a “sector perform” rating. Other changes include: CIBC’s Mark Jarvi to US$5.75 from US$5.75 with a “neutral” rating, Scotia’s Robert Hope to US$6 from US$5.50 with a “sector perform” rating and National Bank’s Rupert Merer to US$6.75 from US$6.25 with an “outperform” rating. The average target is US$5.64.
“Algonquin posted solid Q1/25 results, with core earnings (excluding one-time items) coming in slightly above consensus estimates. We view the shares as fairly valued at current levels and look to the investor update on June 3 for additional clarity over the 2025-27 period. We are increasing our price target to $6.00 (from $5.50) to reflect improving investor sentiment as the new CEO (Rod West) leads the company forward as a pure-play utility,” said Mr. Ng.
“Following his first 60 days at the company, Rod West (CEO) expressed optimism about the company’s potential to become a premium utility company. He identified key areas for improvement, including enhancing customer outcomes, strengthening community engagement, better leveraging economies of scale, and he is very focused on closing the ROE gap on the existing portfolio. We note that pending rate cases total $180 million of additional revenue requests.”
* National Bank’s Don DeMarco moved his B2Gold Corp. (BTO-T) target to $7 from $6.50 with an “outperform” rating. The average on the Street is $6.02.
* Citi’s Stephen Trent trimmed his Bombardier Inc. (BBD.B-T) target to $107 from $109 with a “buy” rating. The average is $114.29.
“Forecast adjustments for Buy-rated Bombardier include the incorporation of (1) a stronger, expected jet delivery mix, including potential defense segment upside, (2) slightly higher, associated margins, (3) higher net interest expense and (4) 1Q’25 results into our model. Citi’s adj EPS estimates for the Canadian business jet manufacturer shift from US$6.57 this year, US$7.89 next and US$10.11 in ‘27E to US$6.56, US$8.02 and US$10.27, respectively,” he said.
* RBC’s Jimmy Shan trimmed his Canadian Apartment Properties REIT (CAR.UN-T) target by $1 to $54 with an “outperform” rating, while Raymond James’ Brad Sturges bumped his target to $51.50 from $52 with an “outperform” rating. The average is $50.80.
“The 4-per-cent year-over-year decline in FFO/unit was in large part due to de-leveraging – leverage neutral, it would have been flat,” Mr. Shan said. “Q1 was a mixed bag. Margin was pressured in Q1 though should improve over balance of 2025 from carbon tax and less weather-related impact. Turnover rent growth moderated to 7 per cent though could improve once turnover tenant mix changes as portfolio-wide MTM opportunity is mid-20 per cent. Occupancy is holding well at 98 per cent and it appears summer leasing is progressing well. Net, while CAP’s Q1 operating performance ranks mid-pack, stock remains attractively valued.”
* Canaccord Genuity’s Matthew Lee trimmed his Canadian Imperial Bank of Commerce (CM-T) target to $92 from $93 with a “hold” rating. The average is $94.14.
* TD Cowen’s Sean Steuart raised his Canfor Corp. (CFP-T) target to $18 from $17 with a “buy” rating. The average is $17.17.
“Management efforts to optimize CFP’s production base in recent years (shrinking B.C. footprint and growth efforts in the U.S. South and Europe) now leave less than 20 per cent of total sales exposed to U.S. duties/expected tariffs. A moderating capex plan should allow for sustained financial flexibility, even as CFP faces steep increases in CVD/ADD deposit rates. We believe CFP offers attractive long-term value,” he said.
* Scotia’s Jonathan Goldman cut his Cascades Inc. (CAS-T) target to $10 from $11.50 with a “sector outperform” rating. The average is $9.92.
* National Bank’s Giuliano Thornhill increased his target for units of Chartwell Retirement Residences (CSH.UN-T) to $21.50 from $20, which is the current average, with an “outperform” rating. Other changes include: TD Cowen’s Jonathan Kelcher to $21 from $20 with a “buy” rating, Scotia’s Himanshu Gupta to $20 from $19 with a “sector outperform” rating and Desjardins Securities’ Lorne Kalmar to $21 from $20 with a “buy” rating.
“CSH’s Q1 performance was notably strong, primarily driven by margin expansion in its SP Pool which exceeded street expectations,” said Mr. Thornhill. “It was noted a low-40-per-cent margin profile is attainable for the calendar year. As occupancy continues to recover alongside demographic aging, margins should maintain this level thanks to lower input costs as the unemployment rate trends to 7 per cent. The boomer cohort is growing and when combined with the current supply/demand imbalance, rental growth in future periods will be heightened. Currently, the next anticipated growth driver for CSH units we view as likely is multiple expansion. Supportive of this assumption is WELL’s current 2026 FFO/u trading multiple of 26 times, which compares to CSH at 18 times.”
* Desjardins Securities’ Chris MacCulloch raised his Cenovus Energy Inc. (CVE-T) target to $23.50 from $22.50 with a “buy” rating. The average is $25.57.
“The company delivered impressive operational and financial performance which contributed to a 10-per-cent rally in the stock. While we are optimistic that CVE has recaptured operational momentum with most major turnarounds in the rear-view mirror, particularly on the downstream side, we believe several additional quarters of operational outperformance will be required to improve investor sentiment,” said Mr. MacCulloch.
* Mr. MacCulloch trimmed his Tourmaline Oil Corp. (TOU-T) to $75 from $76 with a “hold” rating. The average is $76.54.
“While the update was poorly received by the market, we believe the company has an opportunity to reset the narrative when it unveils an updated multi-year plan in 2H25, including a revised development strategy incorporating recent acquisitions. Until then, we remain cautious on the stock as valuation continues to stretch amid more compelling opportunities elsewhere in the sector,” he said.
* Mr. MacCulloch cut his Vermilion Energy Inc. (VET-T) target to $10 from $10.50 with a “hold” rating. The average is $13.64.
“Despite VET capturing modest cost synergies from the Westbrick Energy acquisition, the market continues questioning the strategic rationale of the transaction, which encumbered the balance sheet while handcuffing the company’s ability to accelerate buybacks. Furthermore, recent oil price weakness limits the attractiveness of non-core asset dispositions to help right the ship,” he said.
* RBC’s Drew McReynolds moved his Cineplex Inc. (CGX-T) target to $14 from $13 with a “sector perform” rating. The average is $13.25.
“We believe a strengthened theatrical release window, added film supply from streaming platforms, resilient consumer demand, and renewed momentum within diversification businesses (location-based entertainment, media) have bolstered Cineplex’s earnings power and visibility heading into a stronger box office in 2025 and 2026,“ he said. ”At a FTM [forward 12-month] EV/EBITDA multiple of 7.0 times versus an historical range of 6.0–13.0 times, we continue to see value in the shares and see value relative to peers given Cineplex’s higher-growth and more diversified and differentiated asset mix, stronger competitive position, and potential for non-core asset sales, enhanced capital returns, and/ or strategic optionality. While media and location-based entertainment are not immune to rising economic headwinds, theatrical exhibition has historically proven resilient.”
* National Bank’s Zachary Evershed increased his Doman Building Materials Group Ltd. (DBM-T) target to $10.50, exceeding the $9.50 average, from $9 with an “outperform” rating, while Canaccord Genuity’s Yuri Zoreda cut her target to $10 from $11 with a “buy” rating.
“We rate DBM Outperform as it continues to execute in a difficult near-term environment, working towards a bullish long-term outlook on housing markets driven by strong demographics and under-building exhibited over the last decade,” said Mr. Evershed.
* Canaccord Genuity’s Mark Rothschild cut his Dream Office REIT (D.UN-T) target to $16.50 from $20 with a “hold” rating. Other changes include: National Bank’s Matt Kornack to $16 from $16.75 with a “sector perform” rating and Desjardins’ Lorne Kalmar to $18 from $19.50 with a “hold” rating. The average is $18.14.
“Q1 saw an improvement in in-place occupancy, although largely driven by properties outside of Toronto with the latter exhibiting stability (notwithstanding a drag from transaction activity),” said Mr. Kornack. “Given commitments on vacant space the outlook for the remainder of 2025 should result in better occupancy so long as retention levels are roughly in line with historic averages and assuming the sale of the REIT’s Overland Park property (its sole building in the U.S.), where tenant non-renewal is possible. During and post quarter a sizable portion of the remaining ownership position in Dream Industrial (DIR) was monetized with recently booked tax losses being used to offset the capital gains impact. The result is a $0.10 hit to earnings, although the cash flow implications are less punitive given the relatively low payout ratio and there are concrete liquidity / balance sheet benefits.”
* RBC’s Pammi Bir cut his Dream Industrial REIT (DIR.UN-T) target by $1 to $14 with an “outperform” rating, while Desjardins’ Kyle Stanley cut his target to $14 from $15.50 with a “buy” rating. The average is $13.68.
“As tariff-related macro uncertainty persists, DIR’s trimmed down earnings guidance was perhaps not entirely unexpected. While leasing velocity is facing some headwinds, we see the revised organic growth call as within reach supported by the large gap between in-place & market rents. As well, our forecasts still reflect above average earnings growth. In short, sentiment may need time to build (D reducing its stake likely doesn’t help), yet valuation seems excessively discounted,” said Mr. Bir.
* Seeing a “strong” first quarter setting it up to meet or exceed its full-year guidance, National Bank’s Patrick Kenny bumped his target for Enbridge Inc. (ENB-T) to $64 from $63 with a “sector perform” rating. The average is $65.05.
* Desjardins Securities’ Frederic Tremblay raised his GDI Integrated Facility Services Inc. (GDI-T) target by $1 to $49 with a “buy” rating, while Scotia’s Jonathan Goldman raised his target to $42 from $41 with a “sector perform” rating. The average is $44.88.
“1Q25 results offered a glimpse of GDI’s margin expansion efforts, which we expect to also be visible in future quarters,” said Mr. Tremblay. “Growth-wise, we view 1Q as the trough organically as factors weighing on Technical Services and, most notably, Business Services USA start to dissipate in 2Q. We like GDI’s working capital/balance sheet progress and view it as supportive of the disciplined M&A strategy.”
* Scotia’s Ben Isaacson raised his Interfor Corp. (IFP-T) target to $20 from $22.50 with a “sector perform” rating. The average is $21.75.
* National Bank’s Vishal Shreedhar hiked his Lassonde Industries Ltd. (LAS.A-T) target to $231 from $223 with a “sector perform” rating. Other changes include: Stifel’s Martin Landry to $250 from $243 with a “buy” rating and Canaccord Genuity’s Luke Hannan to $275 from $240 with a “buy” rating. The average is $252.75.
“We consider LAS to be a company with turnaround potential, predominantly within the U.S. operations. We acknowledge that recent operational performance has been encouraging. Notwithstanding, heightened capex and an uncertain macroeconomic backdrop are key considerations,” said Mr. Shreedhar.
* National Bank’s Matt Kornack bumped his Northview Residential REIT (NRR.UN-T) target to $16, matching the average on the Street, from $15.75 with a “sector perform” rating.
“NRR started the year off on strong footing as NOI margin outperformance combined with lower financing costs led to a beat vs. our estimates,” said Mr. Kornack. “Apartment results remain strong, offset in part by waning performance in the commercial segment. Western and Atlantic Canada saw strong rent growth on a same-property basis, bucking macro concerns. Leverage remains elevated, although the REIT continues to pay down its credit facilities, driving earnings accretion from the arbitrage in CMHC financing vs. floating rates. On capital allocation, the REIT continues to sell assets and advance closer to its $100-150-million asset sale target by 2026, which provides immediate accretion to our estimates and should incrementally improve the REIT’s leverage profile.”
* RBC’s Andrew Wong increased his Nutrien Ltd. (NTR-N, NTR-T) target to US$65 from US$60 with an “outperform” rating. The average is US$62.05.
" We think Nutrien continues to execute well with Retail set to achieve 2026 targets, cost savings on-track for early realization, and more efficient capex spend, while ag and fertilizer fundamentals are supportive,“ said Mr. Wong. ”We forecast solid cash generation at $2-billion (8-per-cent yield) annually, supporting a rock-solid dividend, regular buybacks, and opportunistic Retail M&A. We think the negative share price reaction to a Q1 miss was misguided and remain positive on Nutrien as a solid defensive ag name with strong fundamentals amid broader macro and trade uncertainty."
* TD Cowen’s Graham Ryding increased his Onex Corp. (ONEX-T) target to $140 from $134 with a “buy” rating, while Scotia’s Phil Hardie moved his taerget to $132 from $130 with a “sector outperform” rating. The average is $134.
“We are encouraged by Onex’s Q1/25 update, and while uncertainties and potential headwinds have picked up since the start of the year, we believe the stock’s discount already reflects a high degree of risk,” said Mr. Hardie. “Further, we believe investors are likely underestimating the potential for NAV growth and discount tightening over the next twelve months.
“Case in point, Q1/25 saw sequential NAV growth of 3 per cent despite a weaker environment across several major public equity indices. Further, the company continues to advance monetization efforts and recently announced the sale of a minority stake in Westjet. The deal, combined with cumulative distributions, would see Onex fully recoup its initial stake investment and be on track for a return on capital of 2.6 times based on the implied value of its remaining stake. Management noted this represents a 25-per-cent premium to the carrying value of its Westjet investment at quarter end. The company continues to actively buy back shares, which given the discounted stock price are likely to be accretive to NAV/sh and continue to signal to investors that the management team continues to pull levers to drive shareholder value.”
* National Bank’s Patrick Kenny lowered his Pembina Pipeline Corp. (PPL-T) target to $56 from $58 with a “sector perform” rating, while RBC’s Maurice Choy cut his target to $62 from $65 with an “outperform” rating. The average is $61.63.
“While we acknowledge the potential for financial downside associated with the Alliance Pipeline settlement discussion, we believe there were positives to take away from the quarterly results event that were overshadowed and not rewarded by the market given the stock price underperformance post-results release,” said Mr. Choy. “As we anticipate a resolution (and with that, clarity) on the settlement will emerge soon, these positives and the attractiveness of the company’s relative stock undervaluation and cash flow profile should collectively resonate better with investors.”
* RBC’s Darko Mihelic raised his Sun Life Financial Inc. (SLF-T) target to $88 from $82 with an “outperform” rating. Other changes include: CIBC’s Paul Holden to $91 from $89 with an “outperformer” rating and Desjardins’ Doug Young to $93 from $87 with a “buy” rating. The average is $89.83.
“SLF’s results were stronger than expected across most segments,” said Mr. Mihelic. “U.S. stop-loss experience improved from last quarter and Dental results reflected favourable claims experience (Medicaid repricing) year-over-year. MFS continued to see net outflows in Q1/25 but at less than half of last quarter’s net outflows. SLF has solid capital to return to shareholders via its renewed NCIB and dividend which was higher than our estimate. As for all lifecos, there may be upcoming earnings pressures but we see the risk as modest and we believe SLF can manage through a slowing global economy and market volatility well.”
* Canaccord Genuity’s Aravinda Galappatthige raised his Telus Corp. (T-T) target to $21.50 from $20.25 with a “hold” rating. Other changes include: National Bank’s Adam Shine to $22 from $21 with a “sector perform” rating, Scotia’s Maher Yaghi to $24.50 from $23.50 with a “sector outperform” rating and Desjardins’ Jerome Dubreuil to $25.50 from $25 with a “buy” rating. The average is $22.35.
“We believe management’s north star of minimizing capex intensity minus EBITDA growth is a good one to create shareholder value, and the company’s attractive asset mix should enable it to meet its objectives,“ said Mr. Dubreuil. ”We have, however, increased our target less than the share price reaction. The market cheered the results and the dividend growth plan. T now has to execute on deleveraging to match its shareholder distribution ambitions.”