Inside the Market’s roundup of some of today’s key analyst actions
Scotia Capital analyst Maher Yaghi thinks wireless pricing in Canada is “potentially nearing an inflection point.”
“While this call could turn out to be 3-6 months early (similar to our call back in May 2023 when we materially lowered our wireless ARPU [average revenue per user] estimates), we have conviction that the setup is conducive to see price improvement in the coming months; here is why: (1) All 4 wireless players are hurting; (2) Lower prices have not led to gross loading market share gains for Freedom; (3) Quebecor has been successful in lowering churn, but further improvement will be expensive; (4) Quebecor is better off financially increasing prices as industry gross loading slows down; (5) We estimate that more than half of Canadian wireless subs have repriced into lower priced plans already; and (6) We believe flankers will match any Freedom price uptick,” he said.
“If our thesis pans out, we expect wireless pricing to bottom in early 2026.”
In a research report released Monday, Mr. Yaghi upgraded his rating for BCE Inc. (BCE-T) to “sector outperform” from “sector perform” previously, pointing to those conditions as well actions by its management to “rightsize its dividend, immunize the balance sheet from dilution in the U.S., and attractive valuations.”
“When BCE reported Q1 results, the company made 3 important announcements: they cut the dividend by 56 per cent, stopped the DRIP, and announced a JV with PSP that will be in charge of building fiber outside the traditional Ziply territory in the U.S.,” he explained. “Those 3 announcements were exactly what we described back in December as key ingredients for us to become more positive on the stock. We still didn’t upgrade our recommendation at the time because the company’s wireless business showed weak net loading metrics due to elevated churn metrics. Since then, we have learned a few new things. (1) In April and May, the company turned the corner on net adds as both months showed positive loading. (2) We believe in the next few months, the company will begin to reallocate more dollars toward reducing churn by offering more value added services such as Crave to improve the bundle’s attractiveness as well as upgrading customers with handsets, bringing back the company closer to its 2 large peers in terms of percentage of handset upgrades within the mix.
“Another important point in our BCE upgrade is our views on pricing ... As ARPU pressure begins to recede in the coming 6 months, overall pressure on consolidated results should improve. We expect FCF generation in 2026 to be in the same ballpark as 2025, supporting dividends and deleveraging, with a FCF distribution ratio of around 70 per cent.”
Believing BCE shares are now undervalued, Mr. Yaghi kept a one-year target of $39. The average on the Street is $33.92, according to LSEG data.
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Seeing its Cariboo project in British Columbia as “substantially advanced and catalysts near for a valuation re-rating,” RBC Dominion Securities analyst Harrison Reynolds raised Osisko Development Corp. (ODV-X) to an “outperform” recommendation from “sector perform” after assuming coverage of the Montreal-based company.
“The April 2025 feasibility study confirmed Cariboo’s base case potential for 180koz/year at $1,200/ oz AISC [all-in sustaining cost] over a 10 year reserve life,“ he said. ”The critical path is securing project financing, which we expect by YE2025 to support first gold 24 months after. We model financing through a debt facility of $650-million and equity raise of $300-million (net of 5-per-cent discount to current share price). Our asset NAV (8 per cent) for Cariboo is US$1.8-billion at spot gold based on reserves-only and assumes first production in 2028 (vs. the H2/27 management case). Folding in the resource inventory raises our Cariboo NAV by 40 per cent to US$2.5-billion through an incremental 10+ years of mine life. We see meaningful exploration potential at Cariboo to convert resources to reserves and further define the potential of the deposit at depth.”
Mr. Reynolds also suggested Cariboo could be sold, seeing it as a “an attractive acquisition target as a permitted project in a safe jurisdiction with potential upside from mine life extension and/or capacity expansion.”
“Potential acquirers could look at higher throughput scenarios to pull forward production and improve project economics,” he added. “At ODV’s discounted valuation, we see high takeout potential by a group of mid-cap producers with expanding cash flows looking to add production growth at a manageable cost.”
Believing Osisko Development’s current valuation does not reflecting fundamentals, Mr. Reynolds set a target of $5 per share. The average is $5.42.
“Shares have underperformed over 3+ years due to development, permitting, and financing headwinds, but we believe sentiment could improve with permits secured and recent FS streamlining development and confirming economics,” he said. “We see compelling value in Cariboo either as an acquisition target or post-financing with further visibility into production by 2028.”
“Our $5 PT is based on 0.8 times NAV, in line with developer peers, but below growth producers at 1.0x. Spot gold prices imply significant upside potential, with our base case NAVPS rising 80 per cent to $11.08. ODV is trading at 0.2 times spot P/NAV (0.3 times on Cariboo only) vs. emerging/growth producer peers at 0.3 times/0.8 times. We anticipate multiple expansion as sentiment rebounds following improved project fundamentals with a potential inflection point coming after the financing overhang is resolved and delivery of the bulk sample program in H2. In our view, ODV is well-positioned to benefit from investors looking down-cap for leverage to higher gold prices on lagging valuations while we could see accelerating M&A drive shares higher. Outside of Cariboo, there’s potential optionality in the Trixie deposit (Utah) though we do not view it as core to our positive thesis on ODV.”
In separate reports, Mr. Reynolds raised the firm’s targets for these stocks after assuming coverage:
* Artemis Gold Inc. (ARTG-X, “outperform”) to $32 from $28. The average is $25.56.
Analyst: “Artemis Gold is ramping up Blackwater to be a best-in-class standalone producing asset in BC, Canada. Following ramp-up that is in progress to 300koz/ year, there is further value to be unlocked via the acceleration of mill expansions that would increase production to more than 500koz/year by 2027. In our view, scalable production at high margins in a quality jurisdiction support multiple expansion to a premium valuation reflective of the scarcity value.”
* K92 Mining Inc. (KNT-T, “outperform”) to $18 from $19. The average is $16.82.
Analyst: “We are constructive on the outlook for K92 as it evolves the high-grade Kainantu mine in Papua New Guinea from a growth producer to a top-tier gold asset. We expect the imminent commissioning of the Stage 3 expansion to drive a step change in production while bringing cash costs down. Executing on the Stage 3 & 4 expansions should support momentum while exploration success adds upside optionality; however ramp-up delays and PNG geopolitics remain key risks.”
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Following weaker-than-anticipated first-quarter results, National Bank Financial analyst Dan Payne downgraded Lycos Energy Inc. (LCX-X) to “sector perform” from “outperform” previously, citing “ongoing uncertainty and volatility have caused the company to retreat to a defensive stance (restricting capital and terminating its strategic review).”
On Thursday, the Calgary-based company reported cash flow per share of 23 cents, falling 4 cents below the Street’s projection on average production.
“Due to ongoing uncertainty and volatility in the macro, the company has elected to; a) temporarily suspend its capital program until the fall, with $11-million to be allocated through the balance of the year ($40-million total spend; down 40 per cent year-over-year), and b) terminate its strategic review process (again, as the current landscape is not conducive), and each as a means to best insulate the economic returns of its inventory, and opportunistic shareholder returns over the long term,” said Mr. Payne after coming off research restriction.
With its “retreat to a defensive stance,” Mr. Payne reduced his forecast, pointing to “lower implied estimates and discounted view of its value potential,” and cut his target for Lycos shares to $2 from $4.75. The average on the Street is $2.94.
“Our target price is now based on a 3 times multiple (previously 4 times), which is intended to better align with its historical trading multiple (vs. current 2.3 times) and observed market transaction values,” he explained.
Elsewhere, ATB Capital Markets’ Amir Arif lowered his target to $2.25 from $2.80 with an “outperform” rating.
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National Bank Financial analyst Maxim Sytchev argues the “hype” surrounding potential expansion of nuclear power use is approximately priced into shares of AtkinsRéalis Group Inc. (ATRL-T), however he thinks the “excitement being backed by backlog growth can push valuation into much less reasonable territory.”
In a research report released Monday titled Is blue sky outcome already priced in?, Mr. Sytchev said investors are already paying for the nuclear opportunities and “likely rightfully so.”
“Amid positively evolving regulatory landscape, nuclear-related equities are seeing material fund flows and multiple expansion (relevant peers at 19 times EV/EBITDA now) ... We attempt to derive a valuation for the business using a ‘bottom-up approach’ by using a discounted cash flow,” he said. “Our baseline run-rate for the segment is aligned with ATRL’s 2027 targets. On top of this, we layered on both current and potential projects that are not imbedded in the guidance with cash inflows for new builds being recognized uniformly over a 10- to 12-year period and refurb projects having more front-loaded inflows over a 5-year span in a cadence similar to guidance. Our base case assumption suggests an implied value of $26.24 per ATRL share (before corporate costs), which is slightly below our updated $32.41 multiple-driven valuation in our NAV for the Nuclear business. While one could argue that growth could continue to surpass expectations in the near-term, one can hardly call our long-term assumptions punitive.”
The analyst emphasizes Nuclear is “important” for the Montreal-based company, but he thinks a “bigger upside kicker needs to come from Engineering.”
“Based on the pace of refurbishment projects, recent new build announcements, contemplated programs (like OPG), investors are imputing $800-milllion-plus EBITDA business in late 2020’s/early 2030’s, a material step-up vs. $204-million actuals in 2024,” he explained. “While we believe the new ‘nuclear paradigm’ is defensible, we still want to remind investors that the biggest positive lever for ATRL’s share price re-rating relates to better execution in Engineering business, a dynamic that was glossed over in Q1/25 nuclear-infused reporting, given Engineering’s much larger EBITDA contribution - $785-million in 2024 vs. nuclear’ s $204-million; more specifically, a 1 times EV/EBITDA multiple change in Engineering impacts NAV by 5 per cent vs. same for Nuclear at 1.5 per cent. All-in, with cleaned up balance sheet post 407, nuclear momentum and hopefully better H2/25E in Engineering, the path of least resistance is to the upside.”
Reiterating his “outperform” rating for shares of AtkinsRéalis, Mr. Sytchev increased his target to $98 from $92, pointing to a “rapidly expanding relative valuation for nuclear peers amid much more conducive to growth landscape (hence EV/EBITDA applied to nuclear business at 20 times vs. 16 times prior as peers are closer to 19 times and ATRL’s nuclear business is engineering only, has no exposure to commodity risk, controls own tech vs. just being a service provider while also being able to participate in engineering capacity on non-CANDU projects). The average target on the Street is $100.54.
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Desjardins Securities analyst Doug Young thought the second quarter was “good” for Laurentian Bank of Canada (LB-T), emphasizing “management is encouraged by the progress made one year after its investor day.”
“That said, the bank’s transformation is still in the early stages,” he added.
Shares of the Montreal-based bank jumped 6.1 per cent on Friday after reported cash earnings per share for the quarter of 73 cents, exceeding Mr. Young’s estimate by 8 cents and the consensus projection on the Street by 7 cents.
He summarized the release by saying: “Positives: (1) Solid cash EPS beat, driven by adjusted PTPP earnings. (2) Decent credit performance. PCL rate of 19 basis points was in line with our estimate. It had lower impaired PCLs sequentially and some migrations from stage 1 to stage 2. New gross impaired loans decreased both year-over-year and quarter-over-quarter. No change to the total PCL rate guidance in the high teens. (3) Commercial loans grew 1 per cent quarter-over-quarter, mainly from inventory financing. Utilization of 46 per cent remains below the historical level of mid-50s. Management expects inventory finance balances to decrease in 3Q FY25 due to normal seasonality, and it remains cautiously optimistic on utilization rebounding in FY26. The commercial real estate pipeline continued to show positive momentum. (4) NIM was 1bps above our estimate, but management expects NIM to be down in 3Q FY25, driven by lower inventory financing volume. (5) Adjusted efficiency was below our estimate, due to both higher revenue and lower expenses. Management expects some acceleration in investment in 2H FY25 and for the adjusted efficiency ratio for the full year to be at mid-70s. (6) The CET1 ratio was slightly above our estimate at 11.0 per cent. Management appears to be comfortable sitting at a higher level to support future balance sheet growth. A roughly $1-billion deployment in inventory finance loans should consume 40 basis points of capital.”
Also “nothing stands out” concern-wise from the release, Mr. Young increased his target for Laurentian shares to $29, which is the current average, from $27, keeping a “sell” rating.
Elsewhere, other analysts making changes include:
* Scotia’s Mike Rizvanovic to $32 from $28 with a “sector perform” rating.
“The market reacted positively to this quarter’s results which featured a high-quality EPS beat and a constructive outlook. Particularly encouraging, in our view, are anticipated efficiency gains from ongoing cloud migration and the prospects for further normalization in utilization rates for the Inventory Financing business in F2026, both of which could help meaningfully improve the bank’s PTPP earnings trajectory. We are more positive on LB coming out of the quarter and have modestly increased our EPS forecasts. That said, one quarter does not necessarily mark the beginning of a trend, and so we still view LB as a show-me story that admittedly could have meaningful upside given the bank’s heavily discounted valuation multiple,” he said.
* National Bank’s Gabriel Dechaine to $28 from $25 with an “underperform” rating.
“We have increased our forecasts to reflect higher net interest income and commercial loans in Q2/25. We are also increasing our target P/E multiple (on 2026E) on LB to 7 times from 6.5 times to reflect the bank’s consistently growing capital position, which we believe has value in this market environment,” said Mr. Dechaine.
* CIBC’s Paul Holden to $33 from $28 with a “neutral” rating.
“There were small positives with FQ2 results as funding mix improved and credit is showing stability. However, loan growth is not likely to improve in F2025 and LB has yet to report meaningful progress toward its investor day targets,” said Mr. Holden.
* Raymond James’ Stephen Boland to $28 from $27 with a “market perform” rating.
“We continue to wait for evidence of operational improvements before adopting a more positive outlook on the stock. LB remains at mid single digit ROE business, and we expect this to remain for the next several quarters,” said Mr. Boland.
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In other analyst actions:
* CIBC’s Ty Collin initiated coverage of Spin Master Corp. (TOY-T) with a “neutral” rating and $28.00 price target. The average is $32.50.
“We view Spin Master as a leading operator in the global toy industry with coveted brands and attractive economics,” he said. “But tariffs present a new set of challenges for the industry, which is both heavily import-dependent and economically sensitive, and was already facing headwinds. We believe that Spin Master is relatively well positioned to weather the disruption and can mitigate most of the direct costs, but the category is vulnerable to a pullback in discretionary spending. Recovering off recent lows, shares now appear to be pricing in a lower-tariff earnings scenario, and we believe potential upside from further tariff relief is balanced by remaining macro-related downside risks. We believe a larger re-rate is contingent on a more stable trade backdrop, and we look for signs of robust consumer spending and strong execution from TOY before gaining more conviction.”
* In response to U.S. President Donald Trump’s latest plan to raise tariffs on steel imports, Stifel’s Ian Gillies cut his Algoma Steel Group Inc. (ASTL-T) target to $13 from $14 with a “buy” rating. The average is $11.25.
“This event creates a significant negative outcome for Algoma with the critical questions being (1) when and if the Canadian government will provide support to the Canadian steel industry; and (2) how long can Algoma remain solvent with these tariffs in place (mid 2026E in our view assuming no new sources of available liquidity),” he said. “The stock is now a call/ put option on U.S. and Canadian government policy. We are lowering our target price to $13.00/sh while retaining our BUY rating. This view is predicated on some sort of trade agreement being reached between Canada-U.S. in the next 6-9 months, in addition to ASTL receiving some form of government support. We would be buying the stock aggressively on significant weakness on Monday morning.”
* ATB Capital Markets’ Frederico Gomes cut his Canopy Growth Corp. (WEED-T) target in a half to $1.60 with an “underperform” rating following “negative” fourth-quarter 2025 results. The average is $3.30.
“The results show that Canopy would need to materially improve gross margins (16.2 per cent this quarter), cut operating expenses, and increase revenue to reach break-even adj. EBITDA,” said Mr. Gomes. “We believe the Company’s most attractive growth opportunity lies in international medical cannabis markets, which are growing at a rapid pace and provide better margins than the Canadian adult-use market. To that point, Canopy has unified its global medical cannabis businesses in Canada, Europe, and Australia under a single structure reporting directly to its CEO. Management has also announced cost cuts expected to yield $20-million in annualized savings (in COGS and SG&A) over the next 12 to 18 months, with 50% of this target already executed. De-leveraging initiatives, including the prepayment of US$100-million of the Company’s credit facility during the quarter, also support improved cash flows through a reduction in cash interest costs (cash interest was $11.7-million this quarter). Based on our estimates, we expect Canopy to reach break-even adj. EBITDA only in FY2027, and to continue tapping its ATM (US$173-million left) to support liquidity needs.”
* Raymond James’ Michael Glen hiked his Aritzia Inc. (ATZ-T) to $78 from $60 with an “outperform” rating. The average is $68.
“We had an opportunity to sit down with Todd Ingledew, CFO of Aritzia, for a general update. Exiting the meeting it is clear to us that top-line trends continue to track strongly, with management also referencing that recent tariff reprieves with China will help provide sourcing windows for fall. Exiting the meetings, we are increasing our F2026/F2027 EBITDA and EPS by 12 per cent and 16 per cent, respectively. We also believe there will be a series of positive revisions with consensus over the coming months as estimates are adjusted to reflect recent tariff revisions and sales trends,” he said.
* Mr. Glen also increased his K-Bro Linen Inc. (KBL-T) target to $48 from $45 with an “outperform” rating. The average is $48.17.
“On May 13, K-Bro announced its largest acquisition to date, U.K. based Star Mayan Limited for £107-million ($199-million). Star Mayan is a leading commercial laundry business in England, serving the healthcare and hospitality markets with seven operating facilities. On an LTM [last 12-month] basis, Star Mayan generated £94 million in sales with an adj. EBITDA of £14.2-million. The transaction is very complementary to K-Bro’s existing U.K/Scotland footprint, substantially scales revenue (2.4 times), and adds a significant amount of health-care focused revenue. Adjusting for £2-million of identified synergies and cost savings, the indicated multiple was 7.6 times,” he said.
* TD Cowen’s John Kernan raised his Lululemon Athletica Inc. (LULU-Q) target to US$373 from US$370 with a “buy” rating. The average is US$333.65.
* Following the close of its $190-million acquisition of Cole Group, an Alberta-based logistics services company specializing in customs brokerage, freight forwarding and trade consulting, National Bank Financial’s Cameron Doerksen trimmed his Mullen Group Ltd. (MTL-T) target to $17.50 from $18 with an “outperform” rating. The average is $16.68.
“Although end markets remain challenged, Mullen is well positioned to grow through acquisition and valuation remains compelling,” said Mr. Doerksen.