Inside the Market’s roundup of some of today’s key analyst actions
With a recent "POWerful" move in its share price narrowing the net asset value (NAV) discount to his target price, RBC Dominion Securities analyst Bart Dziarski downgraded his rating for Power Corporation of Canada (POW-T) to “sector perform” from “outperform” previously based on valuation concerns.
“The stock has re-rated recently, driving approximately 600 basis points of alpha relative to the S&P TSX & S&P TSX Capped Financial indices, with the NAV discount narrowing to our 15-per-cent justified level,” he said in a research report. “Accordingly, we are downgrading to Sector Perform due to valuation. POW continues to be a strong capital return story with a 4.3-per-cent dividend yield (the lowest since Q3/21) and continued share repurchases (5 million shares re-purchased year-to-date) while maintaining multiple levers of growth (i.e. Sagard).”
Shares of the Montreal-based management and holding company rose a narrow 0.6 per cent on Friday following the late Thursday release of its second-quarter financial results, including adjusted diluted operating earnings per share of $1.36 that exceeded the analyst’s $1.33 forecast as well as the consensus of $1.29.
“The variance to our forecast was mainly driven by fair value increases at Sagard of $98-million (private equity, Wealthsimple),” said Mr. Dziarski." Per RBC analyst Darko Mihelic, GWO’s base EPS was above his estimate reflecting tax recoveries and experience gains partly offset by credit losses. IGM’s normalized EPS was above our forecast and consensus, with a slightly higher-than-forecast EBIT partially offset by ‘Other’. GBL’s contribution to earnings of negative $15-million was below our forecast of $44-million."
After introducing his 2027 forecast, which includes the expectation for mid-single digit EPS growth in GWO, IGM, and GBL’s contribution to earnings, Mr. Dziarski raised his target for Power Corp. shares by $1 to $58. The average on the Street is $60.43, according to LSEG data.
“POW’s current 15-per-cent discount to NAV is in-line with our justified discount given i) simplified organizational structure over the last 5 years, ii) GWO, IGM and GBL re-positioning their businesses and sporting respectable growth outlooks, and iii) growing Alternatives platform providing upside optionality,” he concluded. “Since 2019, POW has been actively surfacing value with $3.6-billion of asset monetizations to simplify its equity story, redeploying capital into seed investments within Alternatives, and returning capital to shareholders via NCIB and growing dividends. We expect further value-enhancing transactions over time. We no longer see valuation upside potential from a narrowing NAV discount.”
Elsewhere, other analysts making target adjustments include:
* Scotia’s Phil Hardie to $65 from $59 with a “sector outperform” rating.
“Power Corp (POW) delivered solid Q2/25 results that provided another data point that its core business is firing on all cylinders,” said Mr. Hardie. “Core operating subsidiaries delivered solid earnings with the alternatives platform surfacing significant investment gains. Our investment thesis related to POW remains intact with ‘all systems go’ and the stock delivering significant alpha generation to investors through a combination of NAV/sh growth, a tightened discount rate and dividend income. The stock is up 60 per cent over the past 12 months with a total shareholder return of over 65 per cent, but we see further upside potential. The NAV discount has tightened; however, even in the absence of further narrowing, we expect the combination of NAV growth and dividends to provide a 20-per-cent return. ... We think POW offers an attractive combination of value, resilience, and healthy dividend yield and that over time it will be recognized as a quality earnings compounder.”
* TD Cowen’s Graham Ryding to $62 from $56 with a “buy” rating.
“The quarterly result was in line with us (above consensus). Buybacks have been healthy year-to-date ($209-million) and the cash balance suggests this should persist. Our BUY rating is supported by our constructive view on the core operating companies (Great West and IGM), growing alternatives AUM, and solid capital returns (dividend increases and buybacks),” said Mr. Ryding.
* Desjardins Securities’ Doug Young to $60 from $55 with a “buy” rating.
“Overall, GWO and IGM had good underlying performance and Sagard’s contribution was well above our expectations this quarter. Yes, POW’s discount to NAV has narrowed considerably this year, but we still see further upside,” said Mr. Young
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In a research note titled All good things must come to an end, Desjardins Securities analyst Kyle Stanley dropped his recommendation for InterRent Real Estate Investment Trust (IIP.UN-T) to “sell” from “hold” to avoid higher tax implications brought on from its pending acquisition by CLV Group and Singapore sovereign wealth fund GIC.
"For non-tax-exempt investors, assuming the vote on August 25 passes, we recommend selling ahead of the deal closing to avoid higher taxation,“ he explained. ”As per the transaction circular, 21–24 per cent of the $13.55 offer price will be classified as ordinary income and taxed at the unitholder’s marginal tax rate. However, should taxation not be an issue, we expect the unit price to converge on the deal price ahead of closing (late 2025/early 2026)."
Mr. Stanley added: “Given the level of investment in the portfolio over the years and associated CCA depreciation, it is unsurprising that the tax basis is low. As a result, $2.85–3.30 of the C$13.55/unit offer price is expected to be classified as ordinary income (21–24 per cent of the price) and taxed at the investor’s marginal tax rate. For reference, this compares with 8.5–9.0 per cent of the SMU takeout price being classified as ordinary income as part of its 2023 privatization. With this in mind, taxable investors should consider selling ahead of the deal’s consummation to avoid the more elevated tax burden."
Following a “soft” second-quarter update last week, he kept his $13.55 target for InterRent units, reflecting the deal price. The average is $13.45.
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RBC Dominion Securities analyst Paul Treiber thinks Constellation Software Inc.‘s (CSU-T) better-than-anticipated second-quarter results reveals “the strength” of its operating model.
"Amidst concerns regarding a slower pace of acquisitions, Constellation surprised to the upside, with much stronger organic growth and profitability. As a result, Q2 adj. EBITDA and FCF were well above expectations. We believe the upside stems from Constellation’s operating model and the reduced drag from transforming acquisitions," he said.
After the bell on Friday, the Toronto-based reported revenue of $2.84-billion, up 15 per cent and matching Mr. Treiber’s estimates while in-line with the consensus ($2.87-billion) "as stronger organic growth offset lower contribution from acquisitions." He added “profitability surprised to the upside with adjusted earnings per share of $24.02 topping projections ($19.57 and $22.11, respectively).
"Constant currency (CC) organic growth was 4 per cent year-over-year, above our estimate for 2 per cent and up from 2 per cent Q1," he said. “Notably, Q2 was well above Constellation’s 10-year average (2 per cent). The upside reflects core maintenance organic growth, which strengthened to 6 per cent constant currency, up from 4 per cent Q1 and above Constellation’s 10-year average of 4 per cent. Notably, we estimate that the unusually high organic growth at Lumine (6 per cent Q2, 1-per-cent normalized) did not have a material uplift on Constellation’s organic growth.”
“Altera rebounded compared to Q1, but the Q2 upside reflects more than Altera. We believe the broader positive surprise stems from the reduced drag from a lower pace of acquisition (transformation of acquisitions typically weighs on margins and organic growth). Also, it’s possible that managers are pursuing organic initiatives, in light of lower contribution from acquisitions. Moreover, managers have a strong focus on driving FCF growth, with TTM [trailing 12-month] FCF up 20 per cent year-over-year and TTM FCF2S up 19 per cent year-over-year.”
Seeing its valuation now “attractive relative to growth,” Mr. Treiber raised his target for Constellation shares to $6,000 from $5,700, reiterating an “outperform” rating. The average is currently $5,577.00
“We believe that Constellation Software is likely to generate one of the highest returns for shareholders over the long term in our coverage universe. Our Outperform thesis reflects: 1) Constellation’s ability to rapidly compound capital through acquisitions; 2) solid underlying fundamentals as a result of an attractive market structure and ROIC-based performance incentives; and 3) Constellation’s valuation is attractive relative to growth potential,” he explained.
Elsewhere, TD Cowen’s David Kwan increased his target to $5,700 from $5,600 with a “buy” rating.
“With the stock underperforming in recent months, we think the solid Q2 results including the strong EBITDA beat, rebound in growth, and pickup in M&A activity should help improve sentiment and ultimately the share price. We expect stronger M&A activity ahead and think that the recent pullback is a great buying opportunity for this proven high quality, defensive name,” said Mr. Kwan.
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Seeing its margins moving higher with a “catch up” in net operating income and its M&A activity set to “reaccelerate”, ATB Capital Markets analyst Chris Murray raised his recommendation for Mainstreet Equity Corp. (MEQ-T) to “outperform” from “sector perform” following better-than-expected second-quarter results.
"MEQ reported another impressive quarter, with strong rental rates, easing cost pressures, and increased stabilized unit base offsetting the impact of normalizing vacancy levels and lower M&A,“ he said. ”Acquisition activity improved in Q3/FY25 with MEQ adding 183 doors, with an additional 87 acquired post-quarter. We expect significant liquidity and increasing levels of uncertainty to support a reacceleration in inorganic growth over the near to medium term, with improving margin trends, mark-to-market adjustments, and higher stabilization rates supportive of the growth outlook.
“With relative and absolute valuations moderating in 2025 (less than 16.0 times 2026 estimated FFO, 1.1 times BV), we see better value in MEQ and view the potential for easing monetary policy in H2/25 as a near-term catalyst.”
Mr. Murray sees the Calgary-based company poised to benefit from more beneficial vacancy rates and believes it’s “ready to play offence.”
“The average vacancy rate was 5.0 per cent (up 40 basis points quarter-over-quarter) or 4.4 per cent (down 10 basis points quarter-over-quarter) on a stabilized basis. While we believe current vacancy rates reflect more balanced market conditions after reaching record lows (i.e., sub 3.0 per cent) in 2024, we see potential for vacancies to drift higher in certain markets given the increasing supply of purpose-built rental units,” he said. “Unstabilized units declined to 12.0 per cent of total units (down 260 basis points year-over-year) on lower M&A activity, with ongoing stabilization supportive of NOI trends.”
“M&A improved q/q with 183 doors acquired in Q3/FY25 ($85-million/door) and an additional 87 units acquired in early Q4/FY25. Softer transaction volumes in 2025 have increased liquidity levels to $815-million, providing capacity for above-average unit growth in the coming periods, particularly given elevated uncertainty and signs of softening conditions in certain markets, which creates opportunistic conditions for the Company.”
He raised his target for its shares to $235 from $225. The average is $242.50.
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Saputo Inc. (SAP-T) had a “strong” performance in the first quarter of its fiscal 2026, according to National Bank Financial analyst Vishal Shreedhar, emphasizing “solid” earnings before interest, taxes, depreciation and amortization (EBITDA) growth across all of its operating segments.
"We expect investor focus to be on steady execution amid a volatile commodity and macro backdrop,“ he said in a client note. ”We acknowledge that SAP is a show-me story; recent performance has been encouraging, enabling multiple appreciation."
Shares of the Montreal-based dairy company jumped 8.9 per cent on Friday reported quarterly earnings per share of 44 cents, rising 5 cents from the same period a year ago and exceeding both Mr. Shreedhar’s 39-cent estimate and the consensus expectation of 38 cents. It also raised his quarterly dividend by a penny to 20 cents per share.
“USA results reflect benefits from improvement initiatives (duplicate costs down 50 per cent year-over-year); Green Bay to close in December, which will improve conversion costs,” he said. “SAP believes USA EBITDA margin can return to 10-per-cent-plus longer term (remaining benefits from capex investments; F2025 USA EBITDA margin was 7 per cent). NBF is short of SAP’s USA aspirations over our forecast horizon as we continue to monitor execution. Europe margin benefited from pricing and cost efficiencies among other factors. SAP previously stated expectations, longer term, for Europe EBITDA margin in the low to mid-teens (NBF models 9.9 per cent in F2026). We believe Argentina is making progress on its margin improvement. SAP noted a narrowing gap between inflation and ARS devaluation, providing mgmt with more visibility. SAP noted better weather in Australia recently; we believe this could support future quarters (more milk supply).
“Canada performance continues to be strong.”
With the results, Mr. Shreedhar increased his full-year 2026 EPS projection to $1.89 from $1.79 with his 2027 estimate rising to $2.16 from $2.10.
That led him to bump his target for Saputo shares to $35 from $29, keeping an “outperform” recommendation. The average target is $34.56.
Elsewhere, others making changes include:
* Scotia’s John Zamparo to $36 from $29 with a “sector outperform” rating.
“FQ1 was the quarter investors had hoped for from Saputo for years: internal capex projects have not only ended but provided healthy returns, market conditions improved, and duplicate costs flowed off,” said Mr. Zamparo. “Better yet, SAP is growing volumes even in challenged sectors like quick-service restaurants, and has taken pricing with seemingly little volume loss. We’ve increased our rest-of-year estimates (we now project 36-per-cent EPS growth for F26) and taken our target multiple up a couple turns to 18 times. Both internal and industry dynamics look quite favorable for Saputo. We expect that as investors once again gain comfort around the commodity, the stock can continue rerating.”
* Desjardins Securities’ Chris Li to $36 from $31 with a “buy” rating.
“SAP’s strong 1Q reflects improved execution, commercial initiatives and stabilizing market demand, resulting in volume growth. Capital investments (lower duplicate costs and improved efficiencies) and favourable mix are driving better profitability. While one quarter does not make a trend and there are always uncontrollable factors, the solid results give us confidence that low-teens EBITDA growth is achievable, a nice inflection from no growth in the past two years,” said Mr. Li.
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In other analyst actions:
* Seeing “less upside from here,” CIBC’s Mark Jarvi downgraded Emera Inc. (EMA-T) to “neutral” from “outperformer” with a $68 target, rising from $65. Other changes include: Scotia’s Robert Hope raised to $70 from $67 with an “outperform” rating, Raymond James’ Theo Genzebu to $70 from $66 with an “outperform” rating, TD Cowen’s John Mould to $74 from $69 with a “buy” rating, National Bank’s Patrick Kenny to $62 from $60 with a “sector perform” rating and RBC’s Maurice Choy to $70 from $69 with an “outperform” rating. The average is $65.12.
“While EMA delivered another blowout quarter (well above raised estimates), the stock was met with a muted response,” said Mr. Jarvi. “We believe that’s because there’s only modest carry-through on earnings uplift to future years and EMA stock has re-rated/been performing very well year to date. Stronger results in 2025 and a P/E multiple re-rate were key to our thesis on the name. At this point, even with modestly higher 2026/2027 estimates and a higher P/E target multiple, the implied total return to our new target is a modest 6 per cent ... We are not negative on the name, and perhaps we are moving too soon on the downgrade, but we simply don’t see the same opportunity to drive relative alpha in EMA vs. our coverage and other Outperformer-rated names.”
* Citing “softer” business conditions and “unclear on [the] timing of improvement,” TD Cowen’s Derek Lessard downgraded GDI Integrated Facility Services Inc. (GDI-T) to “hold” from “buy” with a $30 target, down from $47. The average on the Street is $34.
“GDI’s shares are down 30 per cent year-to-date (down 19 per cent since Q2/25 results), given the Q2/25 revenue miss and weakening outlook on business spending,” said Mr. Lessard. “Although we continue to like GDI’s longterm top-line opportunities and improving profitability/FCF, we believe it is appropriate to move to HOLD, given the lack of any clear near-term catalysts.”
* National Bank’s Zachary Evershed raised his Adentra Inc. (ADEN-T) target to $42.50 from $41 with an “outperform” rating. The average target is $42.61.
“Despite short-term uncertainty from elevated interest rates and geopolitical volatility, we remain bullish on the long-term and rate ADEN Outperform,” said Mr. Evershed.
* TD Cowen’s John Mould lowered the firm’s Algonquin Power & Utilities Corp. (AQN-N, AQN-T) target to US$6 from US$6.50 with a “hold” rating upon assuming coverage. The average is US$6.17.
“We remain cautious regarding AQN’s rate-case outcomes, particularly in Missouri, given the PSC staff’s request for a lower ROE due to past customer service and billing issues,” said Mr. Mould.
* TD Cowen’s Cherilyn Radbourne cut her ATS Corp. (ATS-T) target to $46 from $49 with a “buy” rating, while Scotia’s Jonathan Goldman trimmed his target to $45 from $46 with a “sector perform” rating. The average is $46.11.
“The decline in bookings should not have come as a complete surprise given the company was lapping several large enterprise orders last year,” said Mr. Goldman. “Moreover, bookings can be lumpy quarter to quarter, funnel commentary remained positive, and full year revenue growth outlook was unchanged (i.e., high-single-digits organic). That said, we think low-single-digits bookings growth is a more reasonable expectation this year. The slower margin recovery is in line with our thesis and further expansion will likely be more a function of operating leverage. Management still expects margin expansion this year, but noted progress may not be linear.”
* Mr. Evershed dropped is target for GDI Integrated Facility Services Inc. (GDI-T) to $33 from $41.50, below the $38.25 average, with a “sector perform” rating.
* Mr. Evershed increased his Savaria Inc. (SIS-T) target to $26 from $24 with an “outperform” rating. The average is $25.43.
* National Bank’s Baltej Sidhu reduced his target for Boralex Inc. (BLX-T) to $41 from $43 with an “outperform” rating, while Scotia’s Robert Hope cut his target to $35 from $36 with a “sector perform” rating. The average is $38.55.
“Boralex shares were quite weak (down 5 per cent) following its Q2 results that missed expectations on weak European pricing and generation as well as the surprise announcement that Bruno Guilmette, EVP & CFO, will be stepping down to pursue another opportunity,“ said Mr. Hope. ”That being said, we see this as an overreaction given the company’s overall bench strength and increasing visibility to its longer-term strategic plan. Our EBITDA estimates move down slightly to reflect the quarter as well as the slight delay of some project in-service dates. This in part brings down our target by $1 to $35. We view Boralex as an easy-to-own, high-quality renewable power developer. Boralex is currently trading at 10.9 times 2027E EV/EBITDA versus our target multiple of 11.8 times."
* Stifel’s Daryl Young raised his Cargojet Inc. (CJT-T) target to $130 from $125 with a “buy” rating, while Acumen Capital’s Nick Corcoran cut his Street-high target to $170 from $175 with a “buy” rating. The average is $141.38.
“Q2/25 results were in-line, underpinned by robust domestic network revenue growth (up 14 per cent year-over-year) and charter (up 22 per cent year-over-year), offset by continued declines in ACMI (down 9 per cent). Domestic network growth continues to be a highlight, which management attributes to structural e-commerce adoption trends. EBITDA margins were solid at 33.7% (~161bps above consensus), despite a 10% decline in block hours and are expected to be maintained. In terms of the outlook, management was constructive and noted that it expects a traditional seasonal improvement in activity levels in H2/25 across all three segments (EU-US trade recovery, one-time charter opportunities in advance of de minimis rule changes, and seasonal upswing in China flights). Overall, we continue to like the set-up for Cargojet. The domestic network is supported by accelerating structural e-commerce demand trends, while international provides eventual cyclical upside as global trade relationships are formalized,” said Mr. Young.
* Desjardins Securities’ Frederic Tremblay bumped his Cascades Inc. (CAS-T) target to $10.50 from $10 with a “hold” rating. The average is $10.42.
“2Q results and the 3Q outlook were largely in line with expectations. The main element keeping us on the sidelines is the cautious demand outlook caused by lingering uncertainty surrounding tariffs and trade policies. In this difficult environment, we believe CAS is doing the right thing by prioritizing strategic enhancements to its production assets, leverage reduction and efforts to generate profitability improvements,” said Mr. Tremblay.
* RBC’s Pammi Bir raised his Chartwell Retirement Residences (CSH.UN-T) target by $1 to $21 with an “outperform” rating. Other changes include: Scotia’s Himanshu Gupta to $22 from $20, TD Cowen’s Jonathan Kelcher to $22 from $21 with a “buy” rating and Desjardins Securities’ Frederic Tremblay to $22 from $21 with a “buy” rating. The average is $21.22.
“In the context of a sluggish economic backdrop, CSH continues to set up favourably. With multi-year demand tailwinds at its back and muted near- term supply growth, we see more room for operating metrics to run in both the same-property and growth portfolios. Indeed, as occupancy rises, the benefits of operating leverage are becoming increasingly visible. Simultaneously, accretive portfolio high-grading is providing another lever for growth, as management capitalizes on its stronger cost of capital. With a near sector best growth profile, we reiterate Outperform,” said Mr. Bir.
* Mr. Bir also increased his CT Real Estate Investment Trust (CRT.UN-T) target to $17, exceeding the $16.49 average, from $16 with a “sector perform” rating.
"After another in line print, we believe CRT sets up well amid a still cloudier than usual environment. Its defensive CTC-anchored portfolio should continue to deliver moderate organic growth, complemented by a sizeable pipeline of mostly CTC-related projects. While the Canada Square office retrofit may not be a major value creator, it’s nonetheless an important step forward in the long-term value creation exercise. All said, valuation seems well-supported," he said.
* Mr. Bir raised his Granite REIT (GRT.UN-T) target to $88 from $86 with an “outperform” rating. The average is $85.17.
“On the back of encouraging leasing progress, our confidence in GRT continues to build. In the face of ongoing U.S. trade policy uncertainty, GRT has managed to move the dial forward on occupancy, particularly in the U.S.. Meanwhile, its low leverage has enabled it to flex the balance sheet to accelerate unit buybacks and acquisitions. In short, execution is on point, though valuation has room to catch-up,” said Mr. Bir.
* Scotia’s Phil Hardie bumped his Fiera Capital Corp. (FSZ-T) target to $8 from $7.50 with a “sector perform” rating. The average is $7.25.
“The second quarter results were much more quiet than the drama-filled first quarter that saw 1) a leadership transition, 2) a major pivot in capital priorities with a 50-per-cent dividend cut, and 3) elevated outflows likely representing the last of major expected redemptions from PineStone,” said Mr. Hardie. “We think this moved several lingering investors into the rearview mirror with evolving focus now shifting toward execution leading to renewed operational momentum.
“Management has progressed through a strategic transition with a greater focus on more profitable private markets and higher-value public equity strategies as a source of growth. We think key delivery points for management to drive the stock will need to include: 1) positive flows into key growth areas, 2) margin expansion through cost control, and 3) debt reduction. We were pleased with the cost control demonstrated in the second quarter, and while flows were impacted by pre-announced redemption of two large mandates, we continue to believe the worst is behind Fiera and an inflection point to positive inflows is on the near-term horizon.”
* Scotia’s Ben Isaacson cut his Interfor Corp. (IFP-T) target to $18, matching the average, from $20 with a “sector perform” rating.
“We maintain a Sector Perform rating on Interfor. First, on ops, the IFP team continues to manage the portfolio well, producing exactly as messaged, with no expected downtime in Q3. Second, B/S leverage remains stable in a 35-per-cent to 37-per-cent net debt to cap ratio range, despite a tough macro. This has largely been possible due to non-operational cash inflow actions taken, as well as from regional diversification. While further monetization opportunities remain, the low-hanging fruit has limits. Third, on strategy, two shareholders we’ve spoken with are thinking about whether 25-per-cent crossborder exposure is the right long-term target - we have no view, yet. Fourth, on the lumber outlook, markets remain fragile: over-supplied in the U.S. and over-taxed coming across the border from Canada. That said, W.SPF has begun to re-rate higher to cover the latest duty rates. Based on this, we’ve adjusted ‘25E and ‘26E EBITDA to $130-million and to $270-million, respectively. Fifth, on valuation, our IFP PT moves to $18, as our estimates move lower - partially offset by hiking our multiple to 6.5x - above mid-cycle and so appropriate for a weak outlook, in our view. IFP remains our preferred way to gain exposure to lumber price torque,” said Mr. Isaacson.
* Stifel’s Martin Landry raised his Lassonde Industries Inc. (LAS.A-T) target to $255 from $250 with a “buy” rating. The average is $254.
“Lassonde reported strong Q2/25 revenues of $742 million, up 10 per cent organically,” said Mr. Landry. “This strong organic growth rate is due to a solid performance in Canada where Lassonde benefits from the “Buy Canadian” movement. The company’s U.S. operations are also doing well with 10-per-cent volume growth leading to market share gains. As a result, management raised its revenue guidance for 2025, calling for revenues to increase slightly more than 10 per cent year-over-year vs up 10 per cent previously. We see potential upside to management’s guidance and model a revenue growth of 12.4 per cent year-over-year, given the recent momentum in Canada. Orange concentrate appears excluded from U.S. tariffs applied to Brazilian exports, a sigh of relief for the company. Perhaps the only negative newsbite of the quarter was delays in the CAPEX related to the New Jersey facility due to permitting issues.”
* RBC’s Ryland Conrad raised his Leon’s Furniture Ltd. (LNF-T) target to $35 from $33 with an “outperform” rating. The average is $33.54.
“We believe Leon’s is positioned to deliver steady capital appreciation, enhanced capital returns, and strategic optionality leaning on: (i) market-leading positions in the furniture and appliance categories bolstered by a national retail network and strong brand equity (Leon’s, The Brick); (ii) its vertically integrated ecosystem and ancillary businesses that are growth and margin accretive; (iii) a solid balance sheet (0.5 times net debt/EBITDA) and healthy FCF generation ($2 per share for 2025E); and (iv) M&A and/or real estate optionality with 5.6 million sqft. of owned real estate,” said Mr. Conrad. “At 6.5 times FTM [forward 12 month] EV/EBITDA versus a historical range of 4.0-11.0 times and retail peers at 9.0 times, we believe current levels represent an attractive accumulation opportunity.”
* Raymond James’ Michael Barth raised his Pembina Pipeline Corp. (PPL-T) target by $1 to $64 with an “outperform” rating. The average is $59.44.
"PPL has been the worst performing Canadian midstream/pipe name in our coverage universe both year-to-date and over the last twelve months on the back of concerns about Alliance, the Dow project deferral, and investor concerns that KEY will eat into PPL’s lunch,“ he said. ”Individually and collectively we think this has been an overreaction, and valuation looks increasingly attractive to us. We still view PPL as having the best vertically integrated midstream network in Canada, and see plenty of upside from both sanctioned and unsanctioned growth that we think is underappreciated. Our model has Infrastructure-only Adj. EBITDA/share growth of 7 per cent/year from 2024-2028, and even if that growth is back-end weighted, it’s definitely there."
* Stifel’s Ian Gillies dropped his Russel Metals Inc. (RUS-T) target to $49 from $54.50 with a “buy” rating, while TD Cowen’s Michael Tupholme reduced his target to $50 from $52 with a “buy” rating. The average is $51.
“RUS delivered a solid quarter with adj. EBITDA beating FactSet consensus by 1.3 per cent. The near-term outlook has deteriorated due to tariff uncertainty and steel and non-ferrous pricing discrepancies in Canada,” Mr. Gillies said.
* National Bank’s Matt Kornack bumped his SmartCentres REIT (SRU.UN-T) target to $25.25 from $25 with a “sector perform” rating. The average is $27.19.
" SRU’s quarter was largely in line with expectations as the REIT was able to get in-place occupancy back north of 98 per cent with committed leasing taking figures almost to 99 per cent, functionally full. Leasing spreads were consistent quarter-over-quarter with slight improvement on non-anchor space but lower achieved anchor rent increases. Anchors figure prominently in the lease maturity profile for 2026 and 2027, which will provide downside protection but likely constrain organic growth. On this front, the REIT has had a solid year with up 4.4 per cent year-to-date and around 4 per cent expected for the year, but this quarter had a particularly weak prior year comp and H2 won’t have this benefit. Q4 should see stronger cash figures as leasing completed this quarter didn’t have rent commencement until later in the year," said Mr. Kornack.
* Desjardins Securities’ Doug Young cut his Sun Life Financial Inc. (SLF-T) target to $90 from $95 with a “buy” rating, while Scotia’s Mike Rizvanovic cut his target to $83 from $88 with a “sector perform” rating. The average is $88.25.
“Following a relatively in line quarter that led us to only modestly reduce our EPS forecasts through 2026, we were surprised by the magnitude of SLF’s share price decline on earnings day, suggesting that the price action was less related to near-term EPS downside risk and related more to a degradation in the lifeco’s relative P/ E multiple, which was sitting at a group high prior to Q2 earnings season. Top of mind for investors coming out of the quarter are concerns about the U.S. business, both Dental and stop-loss, as well as another y/y decline in the operating margin for MFS. We felt guidance on the quarterly call was not indicative of any meaningful improvement on those key business lines in the coming quarters, which makes it difficult to see any nearterm catalysts for the stock. As such, we remain Sector-Perform-rated on SLF shares," said Mr. Rizvanovic.
* RBC’s Bart Dziarski raised his Trisura Group Ltd. (TSU-T) target to $55 from $51 with an “outperform” rating, while Desjardins Securities’ Doug Young bumped his target to $54 from $51 with a “buy” rating. The average is $54.25.
“Q2/25 marked another quarter in the right direction for Trisura, which reported “no surprises” in Exited lines, strong growth in Primary Lines (e.g. Surety, Warranty, Corporate Insurance), solid 21-per-cent year-over-year BVPS [book value per share] growth, and solid 18-per-cent ROE,” said Mr. Dziarski. “We believe consistent results similar to this quarter will serve as catalysts to improve sentiment on the name and ultimately drive a re-rating higher. Trisura continues to trade at a discounted valuation (1.9 times on a forward P/B multiple). We re-iterate our Outperform rating and are increasing our target to $55 (from $51). We recently added Trisura to our Small Cap Conviction List.”