Inside the Market’s roundup of some of today’s key analyst actions
Desjardins Securities analyst Benoit Poirier has ”increased confidence" in MDA Space Ltd. (MDA-T) following a recent tour of its Montreal facility, believing “the current stock price does not fully reflect the company’s growth potential.”
“MDA has experienced an uptick in customer conversations as the world looks to diversify away from the U.S./Starlink—repeat order on the horizon?,“ he said. ”The bidding pipeline spans North America, Europe, the Middle East and Africa, with potential customers including not just traditional satellite operators, but also MVNOs, telcos, automakers and sovereign governments. Notably, we believe the market may be underestimating how soon Telesat might exercise its option for 100 additional satellites —potentially even before the initial batch of 198 begins launching.“
Mr. Poirier said the recent investor tour included observing the manufacturing progress on its satellites for Globalstar Inc. as well as it CHORUS two-satellite radar constellation. He also question-and-answer session with CEO Mike Greenley, CFO Guillaume Lavoie and members of the senior leadership team.
“M&A road map unchanged—management to remain disciplined, talking down York Space reports," he said in a client note. “Management reiterated its disciplined approach, stating that it will not pay a premium above MDA’s current multiple and will only pursue profitable, financially sound targets that will not dilute margins. Any deal must also be accretive. In our view, this effectively dismisses recent reports linking MDA to a potential bid for York Space Systems and eases concerns about near-term equity dilution.”
Maintaining his “buy” recommendation for MDA shares, the analyst raised his 12-month target to $40 from $38. The average on the Street is $35.14, according to LSEG data.
“MDA continues to trade at a significant discount to peers and where it was trading immediately following its IPO,” he explained. “Furthermore, two recent successful space IPOs south of the border—Karman and Voyager—show the high level of investor interest and enthusiasm for this growing sector of the economy. Bottom line, as MDA continues to execute on its backlog and to increase visibility on new contract awards, these dynamics should support a sustained multiple re-rating."
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Raymond James analyst Michael Barth sees Keyera Corp.‘s (KEY-T) acquisition of all of Plains’ Canadian natural gas liquids business, along with some U.S. assets, for $5.15-billion is “unequivocally accretive.”
“KEY is up 5.2 per cent since announcing the Plains Canadian NGL transaction [on June 17], and has only outperformed the peer group by 6.4 per cent; we view this absolute and relative performance as an underreaction," he said. “This transaction strikes us as asset-quality neutral, and our estimates suggest the acquisition should end up being 16 per cent/15 per cent accretive to DCF/share on our 2026/2027 estimate, respectively. As far as large midstream M&A goes, this strikes us as home run territory.”
In a client note released Monday, Mr. Barth said he likes the acquired assets, and doesn’t not view the transaction as asset-quality dilutive. He also sees Keyera’s balance sheet remaining “strong” following the close of the deal.
“We estimate that 50 per cent of the acquired EBITDA is attributable to fee-based contributions from and around frac assets, and another 10 per cent is coming from contracted NGL pipelines (to feed the fracs),” he said. “Demand for frac capacity remains strong; we’ve seen a slew of industry expansions announced in recent years backed by long-term take-or-pay agreements, and we expect demand for this capacity to remain healthy as LNG ramps up. Plains did have volume exposure through fee-for-service contracts (small take-or-pay weight), but we think that’s a good ‘volume bet’ to make. Beyond frac, 40 per cent of acquired EBITDA is coming from Marketing businesses, but we estimate roughly half of that contribution is attributable to frac spreads vs. more conventional NGL marketing. Our analysis suggests that strip pricing for frac spreads is backwardated, but (a) still high enough for KEY to generate a healthy margin, and (b) we see risk skewed to the upside if AECO basis disappoints vs. strip pricing (which we think is likely). All-in-all, we don’t mind the modest increase in Marketing exposure.”
“KEY’s ND/EBITDA had trended below the long-term target range of 2.5-3.0 times ahead of this announcement; that low going-in leverage combined with an attractive purchase price helps keep pro forma ND/EBITDA more than 3 times post close. With the strong balance sheet and DCF/share accretion, we see a path to KEY growing the dividend at a more than 8.5-per-cent CAGR from 2024-2029 while holding the DCF payout ratio flat at 2024 levels. If we think about total shareholder return (TSR) as current yield + growth, that works out to a TSR of 13-14 per cent.”
Keeping his “outperform” rating for Keyera shares, Mr. Barth hiked his target to $59 from $51. The average is $50.31.
Elsewhere, TD Cowen’s Aaron MacNeil upgraded Keyera to “buy” from “hold” and raised his target to $51 from $47.
“This transaction is clearly accretive and highlights the potential that M&A can have on the per-share metrics of an under-levered balance sheet. Although we view the transaction as dilutive to overall asset quality, we see the industrial logic for this transaction, given system overlap and opportunity for synergy capture,” said Mr. MacNeil. others making target changes include:
Analysts making target adjustments include:
* ATB Capital Markets’ Nate Heywood to $48 from $46 with a “sector perform” rating.
“The acquisition bolsters KEY’s NGL infrastructure and Marketing business, strategically increasing NGL supply, diversifying basin and customer markets, adding pipeline connectivity, and further expanding its market access,” said Mr. Heywood. “The deal is expected to close in Q1/26 and for modeling purposes we have started contributions from the assets in Q2/26. The deal is being financed through the aggregate $2.07-billion equity offering with the remaining $3.08-billion funded through various debt sources. We see leverage climbing higher from 2.0 times at Q1/25 to 3.0 times by year-end 2026, and falling sharply through 2028 toward the low end of management’s 2.5-3.0 times target ratio. The transaction is expected to be immediately accretive on a distributable cash flow per-share basis, and we see AFFO/share climbing higher by 15 per cent in 2027e from our previous estimate.”
* Scotia’s Robert Hope to $54 from $51 with a “sector outperform” rating.
“We like the transaction as: 1) the assets are highly complimentary and should yield significant near- and long-term cost / growth synergies, 2) it is highly accretive with management pointing to mid-teens cash flow accretion (we estimate 18 per cent in 2027), 3) the funding plan maintains Keyera’s strong financial footing, and 4) it increases the overall scale of the business. Our 2026 and beyond estimates increase to reflect the transaction,” said Mr. Hope.
* CIBC’s Robert Catellier to $56 from $47 with an “outperformer” rating.
“This transformation acquisition adds to the company’s strengths and is materially accretive to DCF/sh while maintaining leverage and payout ratio metrics,” said Mr. Catellier.
* RBC’s Maurice Choy to $53 from $46 with an “outperform” rating.
“We favourably view the proposed Plains transaction, particularly: (1) the strategic benefits of enhancing and extending Keyera’s NGL infrastructure; (2) the mid-teens DCF/share accretion in the first full year; and (3) Keyera’s philosophical approach to M&A that was exhibited by this deal, including a funding strategy that not only avoids any funding overhang, but also maintains a degree of financial flexibility. Beyond the Competition Bureau approval process and initiatives to strengthen the quality of the pro forma cash flow profile, investors will likely focus on the combined portfolio’s longer-term growth potential beyond the base plan,” said Mr. Choy.
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While he acknowledging “the chaos and market volatility that characterized most of its second fiscal quarter, Scotia Capital analyst Phil Hardie thinks AGF Management Ltd. (AGF.B-T) has “managed to demonstrate resilience.”
“AGF has demonstrated solid operating momentum through its first quarter,” he said ahead of its earnings release on Wednesday.
“However, we expect the combination of elevated uncertainty, market volatility and erosion of household confidence to create headwinds. That said, we think AGF may surprise investors with its resilience. We are forecasting Q2/25 mutual fund net sales of approximately $50-million (0.2 per cent of Beg. AUM) compared to outflows of $112-million (-0.4 per cent of Beg. AUM) in Q2/24 and inflows of $258-million last quarter. The last few months have seen large market swings. A solid rally in May limited the decline in AUM to roughly 0.5 per cent.”
Mr. Hardie is currently projecting operating earnings per share for the quarter of 40 cents, up 5 cents from the same period a year ago but down 8 cents from the first quarter.
Maintaining his “sector perform” rating for AGF shares, he raised his target to $14 from $11.50. The average is $13.42.
“AGF’s high exposure to equities is likely to provide torque to the stock price in an upward equity market swing, supported by a strong balance sheet that provides a floor to the stock in the event of a sell-off,” he said. “We expect the elevated market volatility to erode confidence in the earnings outlook and sentiment towards the “higher beta” asset managers, putting pressure on valuation multiples in the near term. That said, we expect these stocks to continue to lead through market recovery cycles.
“Given the transitioning market conditions we expect investors to be focused on what this means for the near-term sales outlook and capital allocation priorities. We also expect to see continued interest in AGF’s product development pipeline and growth strategy across its alternatives platform. ... We have raised our estimates given higher than initially forecast AUM for the quarter and have introduced our 2027 estimates. ”
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RBC Dominion Securities analyst Michael Siperco sees Skeena Resources Ltd.’s (SKE-T) Eskay Creek mine in Northwestern British Columbia as “a top-tier gold (and silver) project, with substantial funding in place and a clear path to production in mid-2027.”
He said a recent site visit highlighted the early work underway ahead of full construction on completion of permitting, which has been guided for late 2025.
“Skeena has mobilized an owner-operated mining equipment fleet, including recently commissioned larger haul trucks, to pre-strip the pit, targeting 3 million tons of material in 2025, using the waste rock for construction,” said Mr. Siperco. “First ore from the high-grade near-surface orebody is expected by mid-2026 with plans for more than1mt of stockpiled ore ahead of mill commissioning.
“Early infrastructure items on track and under budget. Key milestones ahead include the enclosure of the mill building ahead of this winter and the completion of the Volcano Creek substation and permanent camp construction by January 2026 to support peak workforce during full construction. Water management infrastructure construction, including the water treatment plant is underway with completion expected by YE25. Planned spend this year is $250-300-milion (inline with our model).”
Emphasizing momentum has been building ahead of final permitting, the analyst raised his target to $26 from $23 to reflect “higher progress to date and upside beyond the current mine plan.” The average target on the Street is $19.82.
“Execution on near term milestones could lead to further upside as the project is de-risked and takeout potential grows,” said Mr. Siperco, keeping an “outperform” rating.
“SKE trades at 0.70 times NAV at spot, a premium to the developer universe we track at consensus of 0.45 times, justified by the location in B.C., the high-grade open pit resource, and unmodeled upside optionality. Progress in permitting and construction over the next 6-12 months could lead to further multiple expansion and takeout potential, in our view.”
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Citi analyst Patrick Cunningham predicts near-term lithium pricing will “likely remain depressed without significant supply response,” however he adds continued battery demand from companies, such as General Motors Co. and Ford Motor Co., “suggests potential improvement in lithium economics in the latter part of the decade.”
In a research note released before the bell on Monday, he reviewed a tour of Lithium Americas Corp.’s (LAC-T) Thacker Pass project in Nevada and technical development centre as well as meetings with its leadership team, including CEO Jonathan Evans and CFO Luke Colton. The analyst does not currently cover the Vancouver-based company.
While he was optimistic about the potential stemming from Thacker Pass, touting the Lithium America’s “tried and true” mining methodologies and its timeline for mechanical completion and first production by late 2027, Mr. Cunningham warned of “limited near-term greenshoots in lithium.”
“Citi’s commodities team recently published its 3Q25 outlook for lithium,” he said. “Despite 20-per-cent year-to-dateprice declines, supply-side action remains limited. As a base case, the team expects 0-3 month lithium salt prices at $7k per ton, while spodumene prices were downgraded from $700/t to $600/t. The team also expects market surplus to continue into 2027 assuming current spot dynamics with potential upside risk from African exports. Inventory overhang as well as uncertain ex-China EV demand and ESS outlook are likely to limit near-term pricing recovery.
“With China supply dominance and a deep trough in lithium prices, the success of building out U.S. supply chains will likely require support from the government and additional incentives to ensure adequate returns. It will take more than just Thacker Pass. Currently, ALB operates the only producing asset in the U.S. at Silver Peak, NV but pared back its ambitions on broader U.S. supply. The company deferred spending on conversion capacity in South Carolina while still prioritizing permitting activities at King’s Mountain. While a coordinated focus on building US supply would likely include ALB, the company will likely be under significant balance sheet pressure at current lithium prices. LIRC has two U.S. royalties in its portfolio – clay resources in exploration/evaluation in the Southwest. While the geology at Thacker Pass is quite unique, successful production from a clay resource would be a strong proof of concept for the assets in LIRC’s portfolio. Overall, we are encouraged by the buildout of a U.S. domestic lithium supply chain, but the current price environment is likely to challenge investment without intervention."
In the note, Mr. Cunningham reiterated a “buy” rating and $6 target for shares of Toronto-based Lithium Royalty Co. (LIRC-T). The average on the Street is $7.46.
“With LIRC being the first lithium-focused royalty company, we analyzed P/NAV multiples of senior (more than $5-billion market cap) and junior (less than $5-billion market cap) mineral royalty companies to triangulate our multiple of approximately 0.75 times P/NAV. We believe the multiple is appropriate given potential for asset closures under current market conditions, partially offset by the upside from mineral resources from given assets,” he explained.
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Desjardins Securities analyst Lorne Kalmar thinks Primaris Real Estate Investment Trust’s (PMZ.UN-T) $416-million acquisition of Hamilton’s Lime Ridge Mall from Cadillac Fairview is “very much on strategy” and sees it “additive on both a quality and productivity basis.”
“This represents PMZ’s first transaction with CF,” he said. “We had previously highlighted Lime Ridge as a potential acquisition target and estimate that there are at least six additional malls in the pension fund’s portfolio that fit the REIT’s strategy. The concurrent secondary offering enhances PMZ’s trading liquidity significantly while removing the overhang of a future sell-down of units by CF. It should also enable PMZ to continue to transact with CF. Lastly, the addition of another market-dominant mall should enhance its negotiating leverage with tenants.”
“Lime Ridge is the dominant mall in Hamilton, with annual sales of $251-million and sales productivity of $841/sf. The mall is currently 61.3 per cent occupied (62.3 per cent committed), owing to two former anchor spaces (HBC and Sears); excluding these two boxes, for which minimal value was attributed as part of the acquisition, we estimate occupancy is 90 per cent. Management expects an 8–9-per-cent return on incremental capital spent to retenant these two boxes. Given the REIT’s growing track record of acquisitions outperforming initial expectations, we see no reason that PMZ could not replicate that success with Lime Ridge.”
Resuming coverage following Primaris’ $124.3-million secondary offering that came in conjunction with the acquisition, Mr. Kalmar raised his funds from operations forecast for both 2025 and 2026 while maintaining his “buy” rating and $17 target for its units. The average is currently $17.59.
Elsewhere, CIBC’s Tal Woolley raised his target to $19 from $17.50 with an “outperformer” rating, while RBC’s Pammi Bir reiterated an “outperform” rating and $18 target.
“We continue to see a mix of good value and growth in PMZ. From our lens, the purchase advances portfolio quality up the curve, with an opportunity for PMZ to drive NOI upside by implementing its proven leasing strategies and leveraging the scale of its platform. Importantly, the balance sheet remains in solid form, with leverage well below sector level,” said Mr. Bir.
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In other analyst actions:
* Following a visit to Aya Gold & Silver Inc.’s (AYA-T) Zgounder silver mine and the advanced-stage polymetallic asset, Boumadine, in Morocco, Scotia’s Ovais Habib trimmed his target for its shares to $18.50 from $19 with a “sector outperform” rating. The average is $19.70.
“The visit reaffirmed our view that Aya is making steady progress on its growth strategy, with visible operational traction and an increasingly scalable production profile,“ he said. ”With the ramp-up to a new mine configuration at Zgounder underway, we believe the company is well-positioned to build toward a 6 Moz/year silver platform while unlocking multi-asset optionality.”