Inside the Market’s roundup of some of today’s key analyst actions
National Bank Financial analyst Travis Wood thinks Strathcona Resources Ltd. (SCR-T) provides investors with “pure-play oil sands exposure to long-life development opportunities at what we view as a relative discount to the peer group.”
“Unique in many ways, the company effectively offers public investors access to long-term, private-style strategy where Strathcona leverages a value investing approach that embeds intrinsic value across the development of the portfolio over the long term,” he said.
“The focus on corporate-level returns through strict capital allocation decisions across a unique organizational structure creates a culture of accountability and innovation. With line-of-sight towards 200 mbbl/d [thousand barrels per day] of heavy oil production, up from just 120 mbbl/d today, investors are offered heavy oil growth at a reasonable price (HOGARP!), backstopped by ample liquidity, improving sustaining costs and expanding margins through asset optimization and cost management.”
In a research report released Monday, Mr. Wood initiated coverage of the Calgary-based company with an “outperform” recommendation, emphasizing it currently trades at a “reasonable” 25-per-cent discount to its oil sands peers, which he expects to narrow as it “improves liquidity and executes on its heavy oil growth plan.”
“What we like about Strathcona: * Unique management structure where strategic and capital decisions are supported by a team of executives, including the COO, CFO and CCO, leaving day-to-day accountability and innovation to three independent Presidents at the business unit level; *Long-term, disciplined value investing approach, inherently embedding shareholder value across both transactional and organic opportunities in the WCSB; * Transparent line-of-sight to organic growth across the thermal portfolio, where costs are expected to trend lower through reductions in steam-oil-ratios (SOR) and asset optimization opportunities; * Potential for a special dividend through the accumulation of pure value creation triggered by FCF generation and investment decisions; * Downstream market access through rail contracts that provide USGC exposure, limiting the company to WCSB price volatility,” said the analyst.
While he acknowledged Strathcona’s “significant” growth achieved since its inception, Mr. Wood expects it to “continue pursuing decent growth through the end of the decade (CAGR [compound annual growth rate] of 9 per cent versus post-Montney disposition levels) with line-of-sight to growing production towards 200 mboe/d over the next +5 years.”
“Ignoring any potential outcomes from the MEG takeover bid (we expect more clarity by the end of the summer), we see attractive growth optionality through 2030, supported by proven, capital efficient heavy oil projects and optimizations,” he added.
He set a Street-high target of $42 for Strathcona shares. The current average target is $31.80, according to LSEG data.
“We are ascribing SCR with a 2026 multiple, as we believe this better portrays the company’s full potential as it captures the recent divestiture of its natural gas and Montney portfolio (versus an approximate half year of results that would be captured in 2025),” he explained. “Despite the improvements Strathcona continues to make on the operational performance front (as we’ve seen recently at Tucker), we rank the asset quality (in particular those in the Cold Lake region) as average and therefore ascribe SCR with a target multiple in line with the peer group. While we await clarity on the outcome of the MEG takeover bid, we also await more colour on further opportunities to improve share liquidity, but we do flag the long inventory runway, unique management structure, the shovel-ready expansion and the crude-by-rail logistics network in Western Canada (and the natural hedge it provides) as some relative advantages we have earmarked as things to consider.”
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While emphasizing the presence of “fluid geopolitics,” RBC Dominion Securities analyst Michael Harvey does not expect significant capital expenditure or guidance changes from Canadian energy exploration and production companies during the approaching second-quarter earnings season, seeing “other themes including the startup of LNG Canada and accompanying views on pricing.”
“We expect that FCF generation and execution of RoC programs will continue to be focal points,” he added. “Our second quarter production and cash flow estimates generally sit in line with FactSet consensus figures on recent revisions; 2025 capex/production points to 17 per cent/15 per cent year-over-year gains in aggregate as midcap producers continue to lean into modest growth.”
In a note released Monday, Mr. Harvey made modest adjustments to his forecast to reflect outages and select company specific factors. His cash flow per share estimates for oil and gas-weight companies are now declines of 15 per cent and 22 per cent quarter-over-quarter, respectively, and down 9 per cent and up 6 per cent year-over-year.
“Select third party outages in June are likely to impact numbers as well, alongside strategic shut-ins on low AECO gas pricing,” he added.
With that view, he made a series of target price adjustments to stocks in his coverage universe:
- Advantage Energy Ltd. (AAV-T, “sector perform”) to $12 from $11. The average on the Street is $13.45.
- Birchcliff Energy Ltd. (BIR-T, “outperform”) to $8 from $7. Average: $8.
- Kelt Exploration Ltd. (KEL-T, “outperform”) to $8.50 from $8. Average: $9.17.
- Kiwetinohk Energy Corp. (KEC-T, “outperform”) to $21 from $18. Average: $21.10.
- NuVista Energy Ltd. (NVA-T, “sector perform”) to $16 from $14. Average: $16.96.
- Paramount Resources Ltd. (POU-T, “sector perform”) to $23 from $21. Average: $24.70.
- Tamarack Valley Energy Ltd. (TVE-T, “outperform”) to $6 from $5.50. Average: $5.75.
Mr. Harvey’s “top ideas” in the space remain ARC Resources Ltd. (ARX-T, “outperform” and $34 target) and PrairieSky Royalty Ltd. (PSK-T, “outperform” and $35 target). Both are on RBC’s “Global Energy Best Ideas” list.
For Arc, he said: “With a strong balance sheet and large M&A on hold (for now), the focus remains on Attachie development, RoC initiative and integrating assets from its pending Kakwa acquisition. ARC targets return of capital of 100 per cent of its FCF via base dividend tied to earnings growth and share buybacks. Production growth is not a specific target but rather an outcome of the most efficient way to execute projects (Sunrise, Attachie) paired with the Basin’s capacity to absorb new product and is unlikely to exceed 5 per cent organically.”
For PrairieSky, he said: “PrairieSky’s 2025/26 production profile is 63-per-cent/63-per-cent liquids-weighted with royalty revenue driven by liquids at 91 per cent/86 per cent. PrairieSky is the largest royalty landowner in the WCSB (18.5 million acres; 9.8/8.7 million acres Fee/GORR lands) and is supported by some of the top operators. The company has significant lands in all key plays throughout the WCSB. We expect 2025/26 corporate production to increase by 4 per cent/8 per cent with the Mannville Heavy, Clearwater, Viking and Duvernay plays leading the pack in activity. The royalty business model is also insulated from industry cost inflation, providing margin stability.”
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CIBC World Markets analyst Cosmos Chiu sees Vizsla Royalties Corp. (VROY-X) as “an attractive vehicle for investors to gain exposure and leverage to silver,” pointing to the recent price strength for the precious metal and a “dwindling universe of investible silver companies (a direct result of heightened M&A activity in the space).”
In a report released before the bell, he initiated coverage of the Vancouver-based company with an “outperformer” rating.
“VROY was first created as a spin-out in August 2024 from Vizsla Silver (VZLA) to hold a relatively small Net Smelter Return (NSR) royalty on the Panuco asset,” Mr. Chiu said. “This all changed when VROY completed a transformative transaction in June 2025 that increased its near-term NSR interest from 0.5 per cent to 3.5 per cent, with a concurrent equity financing that improved the liquidity of the company’s shares and grew the company’s market capitalization to more than $100-million, making it more attractive to investors.”
The analyst sees Panuco, located in Sinaloa, Mexico and operated by Vizsla Silver Corp. (VLZA-T), as one of the most prospective development projects in his silver coverage universe.
“The July 2024 Preliminary Economic Assessment (PEA) had highlighted an operation capable of producing more than 15 million ounce of silver equivalent (AgEq) annually (including more than 9Moz of silver) over a mine life of 10.6 years,” he explained. “Subsequently, in January 2025, VZLA released the results of its updated Mineral Resource Estimate (MRE), pointing to a 43-per-cent increase in M&I ounces to 222.4 million ounces of AgEq. The next potential catalyst will be the release of a Feasibility Study (FS) in H2/25, which will incorporate results from the company’s most up-to-date drill program, as well as results from its ongoing Test Mine program.
“VROY holds two distinct NSR royalties (essentially a top‑line, revenue-based royalty), with a 3.5-per-cent interest in the Silverstone concessions, including the most near-term production area at Copala, and a 2-per-cent interest in the Rio-Panuco concessions. Our base case NAV for VROY’s royalty interest is $154-million (on our commodity price deck), but we foresee upside potential in both throughput and grade. Our sensitivities demonstrate that, at spot prices, accompanied by a 20-per-cent increase in both grade and throughput, the NAV of the Panuco NSR royalty increases to $300 million.”
Pointing to its “discounted” valuation, he set a Street-high $4 target for Vizsla shares, exceeding the $3.25 average.
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Citi’s Stephen Trent raised his forecast for Air Canada (AC-T) with a stronger Canadian dollar expected to result in lower cost per available seat mile, excluding fuel charges, as well incorporating the impact of the recent completion of its $500-million substantial issuer bid share buyback.
The analyst is now projected second-quarter earnings per share of 71 cents, up 6 cents from his previous model. His full-year 2025 forecast jumped to $2.25 from $2.11, while his 2026 and 2027 estimates jumped to $3.13 and $3.37, respectively, from $3.05 and $3.25.
In a research note released late Sunday, Mr. Trent also questioned whether recent recommendations from Canada’s competition watchdog to boost competition in the airline industry, including allowing foreign-owned carriers to fly domestic routes and phasing out restrictions on foreign ownership, will have a significant impact for consumers.
“Canada’s antitrust watchdog appeared to create a stir, earlier this month, when it recommended that the country eliminate foreign ownership restrictions on Canadian airlines that only fly domestically,” he said. “While we understand the consumer desire for more choice/lower fares, allowing foreign carriers to own 100 per cent of Canadian domestic airlines, seems far removed from any guarantee of meaningful reduction in fares.
“Assuming that authorities eventually move ahead with this proposal, key questions would include (1) what new domestic routes would such carriers operate, and/or where would they increase existing domestic frequencies, which would result in both lower airfares and increased profitability for the carriers in question, (2) to what degree would authorities unilaterally provide foreign carriers cabotage rights, or the right to operate domestic flights, while not requesting foreign cabotage rights for Canadian airlines, and (3) to what degree would authorities consider easing the ticket price burden through reduced airport fees?”
Mr. Trent kept a “buy” rating and $25 target for Air Canada shares. The average on the Street is $23.40.
“Although Air Canada appears to have very similar opportunities, Canadian dollar trends and somewhat lower FCF generation at least somewhat reduce Air Canada’s comparability with its U.S. peers, on a fundamental basis,” he said.
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When Rogers Communications Inc. (RCI.B-T) reports its second-quarter results on July 23, National Bank Financial analyst Adam Shine expects further evidence of pressure stemming from the ongoing domestic wireless battle, while he anticipates “some” cable growth and a positive impact from its National Hockey League rights package, leading to gains in its Media segment.
“While pricing pressure in Wireless hasn’t found a new bottom, competitive pressures persist and the sector is still working through a lapping of reduced immigration,” he said. “Price increases and other actions likely helped Cable revs return to modest growth in 2Q, with five Canadian teams in the NHL playoffs offering a boost to Media revs. We forecast capex of $835-million (consensus estimate: $959-million) as this metric appears to be skewing to lower end of annual guidance and FCF of $852-million (CE $693-million).”
For the quarter, he’s currently projecting total revenue of $5.18-billion, up 1.7 per cent year-over-year (from $5.093-billion) and narrowly higher than his consensus forecast of $5.113-billion. However, he estimates adjusted earnings per share will fall 3.9 per cent to $1.12 from $1.16 a year ago (versus the Street’s expectation of $1.07).
Keeping an “outperform” rating for Rogers shares, Mr. Shine raised his target by $1 to $53 based on his revised forecast. The average is $51.11.
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In other analyst actions:
* In response to “mixed” fourth-quarter 2025 results, Ventum Capital’s Amr Ezzat cut his Tecsys Inc. (TCS-T) target to $47 from $52 with a “buy” rating. The average is $48.40.
“[Friday’s] conference call reinforced two key points,” he said. “First, there are no signs of pipeline fatigue, despite the lower SaaS growth guide and ongoing political noise around potential Medicaid cuts. Management emphasized that 90 per cent of F2026 SaaS revenue is already contracted, with early FQ1 indicators pointing to continued momentum – including in US healthcare, where policy risks have not translated into any observable commercial slowdown. Second, SaaS margin expansion remains firmly on track, with execution progressing across three known levers: platform migrations, cloud infrastructure efficiency, and reduced support intensity. While EBITDA guidance was revised downward, the underlying thesis – expanding SaaS margins on a growing, sticky base – remains intact.
“The business remains in the midst of an earnings inflection, with explosive SaaS growth driving structurally higher profitability (case in point: Thursday’s 6-per-cent year-over-year revenue growth translated into 55-per-cent EBITDA growth). With SaaS margins set to expand meaningfully in the coming years, we see a clear path to a quintupling of EBITDA – a story that rewards patience.”