Inside the Market’s roundup of some of today’s key analyst actions
After Alimentation Couche-Tard Inc. (ATD-T) surged 6.3 per cent on Wednesday as investors cheered renewed growth optimism following a return to positive growth in U.S. merchandise same-store revenues, Stifel analyst Martin Landry thinks the retailer’s shares “could continue their upward trend in the coming months.”
“Successful promotions in food, energy drinks and tobacco seem to be gaining traction and bringing back growth,” he said in a client note. “July was the strongest month in more than two years for U.S. merchandise same-store revenues and this momentum carried into Q2FY26. The return to growth in U.S. merchandise same-store revenues was combined with a 90 basis points year-over-year margin expansion, a healthy mix. Before [Wednesday’s] rebound, Couche-Tard’s shares were down 13 per cent year-to-date, on a lackluster operational performance and M&A overhang.”
“Near-term, investors will benefit from an active share buyback program to support the stock and longer-term, ATD should continue to be active in M&A.”
Couche-Tard eyes U.S. growth with Guy Fieri partnership, bargain meal bundles
After the bell on Tuesday, Couche-Tard, based in Laval, Que., reported first-quarter fiscal 2026 earnings per share of 78 cents, down 6 per cent year-over-year but topping Mr. Landry’s projection by 3 cents and the consensus expectation by 2 cents. He said “strong” U.S. gasoline margins last year “created a difficult comparable,” and if similar conditions were present, EPS would have been up 5 per cent from the last fiscal year.
“Management mentioned that the final month of the quarter was the strongest for the company in the last two years for U.S. merchandise same-store revenues,” he said. “That momentum continued into Q2FY26 with positive merchandise same-store revenues growth for the past 10 weeks in the U.S. and Canada. As a result, we increased our merchandise same-store revenue growth assumption by 100 basis points to 2 per cent for Q2FY26. This momentum is welcomed and partly explains why the shares performed well [Wednesday].”
Also emphasizing the growth of its loyalty program, Mr. Landry thinks the M&A pipeline appears “healthy.”
“Given the current challenging industry conditions, management is receiving a healthy deal flow of operators looking to sell,” he said. “The focus remains in North America and within the convenience channel as opposed to adjacent retail opportunities. Acquisitions remains an important growth driver for ATD and with a strong balance sheet we believe that the company will continue to create value for shareholders with its M&A strategy.”
With his updated forecast, Mr. Landry raised his target for Couche-Tard shares by $4 to $85, maintaining a “buy” recommendation. The average target on the Street is $84.72, according to LSEG data.
“We view an investment in Couche-Tard has having a low-risk profile due to: (1) the company’s strong cash flow generation, (2) the recession-resilient and online-resistant nature of the convenience industry, (3) Couche-Tard’s healthy balance sheet and (4) the impressive track record,“ he said.
“ATD’s shares trade at approximately 16 times forward earnings, roughly in-line with the 10-year average, while Canadian peers, such as grocers and dollar stores trade at a premium to their historical averages. ATD has a better balance sheet than historically with a leverage of 2 times debt/EBITDA, which provides flexibility to make further M&A transactions or return capital to shareholders.”
Elsewhere, other analysts making target adjustments include:
* National Bank’s Vishal Shreedhar to $84 from $82 with an “outperform” rating.
“Performance was encouraging; we think momentum in results should drive an inflection in earnings growth (we reflect positive EPS growth starting in Q2/F26), in addition to possible slight multiple expansion. The key for ATD is to deliver sustained growth via organic drivers and complementary acquisitions, in addition to share repurchases. Beyond Q1/F26, ATD repurchased 7.9 million shares for $405-million,” said Mr. Shreedhar.
* TD Cowen’s Michael Van Aelst to $89 from $85 with a “buy” rating.
“Conference call comments around U.S. SSS momentum building over Q1 and continuing into Q2 (led by foodservice, energy drinks) provides optimism — we now see Q2 US SSSG reaching 2 per cent — and pushed ATD stock up 6 per cent,“ said Mr. Van Aelst. ”Consumer health is not yet improving, so market share gains are driving the performance. Relative valuation remains attractive, particularly considering our 15-per-cent EPS CAGR forecast through F28.”
* Scotia’s John Zamparo to $84 from $78 with a “sector outperform” rating.
“Our prior bullishness on ATD stemmed from multiple sources, and that was amplified this quarter. Fuel margins and nicotine are thriving; food is positive and improving, and the Guy Fieri collaboration could hold real promise; while the sizable buyback provides support. As other large-cap names in our coverage face more questions about valuation, ATD’s (17.7 times our NTM [next 12-month] EPS forecast) looks compelling. ATD appears well-positioned to post at least a few more quarters of solid growth,” said Mr. Zamparo.
* CIBC’s Mark Petrie to $87 from $84 with an “outperformer” rating.
“While 0.4-per-cent SSS growth is not much to get excited about, sentiment on ATD’s organic growth potential is as low as we can recall. So comments about accelerating momentum had an outsized effect on shares. We remain cautious about a re-acceleration to the halcyon days of 4-per-cent-plus SSS but are comfortable with gradual recovery supported by further progress on food and beverage,” said Mr. Petrie.
=====
In response to a recent 30-per-cent share price “downdraft” from all-time highs and the accretive $82.3-million acquisition of New Westminster, B.C.-based Fraser River Pile & Dredge (GP) Inc., National Bank Financial analyst Maxim Sytchev is “stepping in again” to Bird Construction Inc. (BDT-T), upgrading his recommendation to “outperform” from “sector perform” previously.
“We were leery of BDT’s parabolic share price rise in 2024 (despite management’s excellent execution); the dynamic came to a screeching halt on the back of organic growth moderation at an estimated negative 11 per cent in Q2/25 (vs. expectations of 10-per-cent top-line CAGR [compound annual growth rate]), bringing BDT shares to down 12 per cent year-to-date (vs. up 16 per cent for TSX),“ he explained.
“We have been searching for a catalyst to upgrade the stock on the back of a disappointing Q2/25, but wanted to see the negative earnings revision backdrop to at least subside; now that that cycle has more than likely flushed out (Street EPS estimates for 2025E have been revised downward by 25 per cent since February 2025), with this strategic tuck-in M&A in a growing end-market, the hump of expectations is behind us. We like FRPD’s exposure (port, marine, and dredging are generally aligned with dual-use infrastructure for civilian/military applications), attractive pre-synergies multiple (4.1 times EV/EBITDA vs. BDT’s own 7.6 times on 2025E), EPS accretion (up 7 per cent), and more balance vertical split (infrastructure now at 30 per cent of overall sales vs. 15 per cent pre-deal); these factors all make us think that the stock will go higher.”
After the bell on Wednesday, Mississauga-based Bird announced the acquisition of Fraser River Pile & Dredge, which serves the marine construction, land foundation, and dredging sectors in Western Canada. Mr. Sytchev thinks the deal “significantly increases Bird’s pro forma revenue exposure to accelerating infrastructure spending across Canada, including vital ’nation-building’ projects and the snowballing build-out of both trade-enabling and defense-focused physical infrastructure.”
“FRPD’s high proportion of self-perform work aligns with Bird’s strategic and operational criteria for acquisitions, and will incrementally lower reliance (and associated risk) on subcontractors going forward,” he added. “In addition, FRPD brings significant cross-selling opportunities, including with legacy Jacob Bros operations as the purchase scales up Bird’s B.C. infrastructure operations.”
After adjusting his forecast to account for the transaction as well as seasonality, the analyst increased his target for Bird shares to $28 from $26. The average is $32.63.
“Recall that post last quarter, we already lowered our estimates (predominantly via the top line) for 2025E/2026E as Industrial customers continue to monitor the macroeconomic uncertainty before giving final go-aheads on projects,“ he said. ”We are now more confident around the Street reflecting a more realistic growth trajectory that is still likely to result in 8-per-cent EBITDA margins in 2027E; top-line 10-per-cent CAGR feels like a stretch at the moment but with tonight’s announced transaction and material backlog, we should be in the ballpark. We are nevertheless still below consensus as timing of some of the programs has been trickier to model as we are uncertain what macroeconomic event could act as a catalyst for BDT’s customers; note that we have also adjusted our margin expectations when in comes to seasonality in H2/25E, modeling a more pronounced rebound by year-end as projects start to cycle through.”
=====
Scotia Capital analyst Ovais Habib sees Montage Gold Corp. (MAU-T) “building West Africa’s next major gold mine” through its flagship asset, the development-stage Koné gold project in Côte d’Ivoire.
“The project is a large-scale, low-cost open-pit development anchored by the Koné and Gbongogo deposits, along with upside for exploration and strategic minority interests in regional gold projects,” he said in a client report. “Backed by a robust feasibility study outlining a 16-year mine life and average annual production of 223 thousand ounces at an all-in sustaining cost (AISC) of $998/oz, the project is currently under construction, fully permitted, and on track for first gold in Q2/27.
“Montage is fully financed for the initial capital costs of the Koné project, with $825 million in non-equity funding secured. This includes a $625-milling gold stream and $75 million loan facility from Wheaton Precious Metals Corp. (WPM-T; rated Sector Outperform), and a $75 million subordinated stream and $50 million loan from Zijin Mining (Zijin; not covered). We believe the company remains adequately funded, even with modest 5-per-cent inflation to the capital budget. This robust financial position follows an oversubscribed $180-million private placement completed in July 2024."
Mr. Habib initiated coverage of the Vancouver-based miner with a “sector outperform” rating, pointing to the appeal of Montage as “a single-asset developer with a large-scale resource base, access to key infrastructure, and competitive operating costs in a mining-friendly jurisdiction.”
“We also view Montage as a potential consolidation target or consolidator, supported by strategic backing from the Lundin Family and Zijin Mining, and by its thoughtful approach to building exploration optionality through minority investments in early-stage companies across West Africa,” he noted. “We believe some or all of these equity investments could evolve into joint venture opportunities and/or create regional synergies with Montage’s Koné asset over time.”
In justifying his bullish stance, Mr. Habib also emphasized he sees Montage offering “meaningful exploration upside across its portfolio.”
“The company is actively unlocking value across its 1,318 km² land package through a focused exploration strategy aimed at lifting the Koné production profile beyond 300 koz per year (currently 223 koz per year),” he said. “Since 2024, the company has added 544 koz of new resources and is targeting the discovery of 1 Moz of Measured & Indicated (M&I) resources at grades 50 per cent higher than the Koné deposit (currently 0.57 grams per tonne [g/t]). The 2025 drill program has been expanded to 120 km, with key targets including Gbongogo South, Koban North, ANV, and Lokolo. Several of these deposits sit on or near existing mining permits, offering near-term integration potential.”
Seeing “a significant valuation re-rating opportunity as Montage Gold continues to advance the Koné project, which is progressing on time and on budget,” the analyst set a target of $6.25 per share, exceeding the average on the Street of $6.11.
=====
In a research report released Thursday titled No Time Like the Current to Build a U.S. Copper Mine, National Bank Financial analyst Andrew Dusome initiated coverage of Ivanhoe Electric Inc. (IE-T) with an “outperform” rating, seeing its flagship Santa Cruz Copper Project providing a domestic source of copper cathode and “supporting the U.S. Administration’s aim of supply chain independence.”
“[Santa Cruz] s located approximately 92 kilometres south of Phoenix in Pinal County, Arizona,” he said. “The project location provides many advantages as it is in proximity to key infrastructure to build/operate a mine as well as major cities with a large mining workforce. The current LOM [life-of-mine] plan envisions an U/G mine with a 20+ year mine life producing 3 billion pounds of copper cathode for sale within the domestic U.S. market.”
“As the Santa Cruz Copper Project is located on a large private land package, the federal permitting requirements are reduced, which we believe streamline the permitting process. Given the focus on developing domestic copper sources within the U.S., we expect IE to have strong government support as already evidenced through the Letter of Interest received from the U.S. EXIM Bank to fund the construction of Santa Cruz. With the current U.S. administration’s focus on strengthening America’s copper industry, supply chain resilience and reducing trade imbalances, we believe Santa Cruz is well positioned to be one of America’s next copper mines.”
Mr. Dusome also emphasized the Phoenix, Ariz.-based company is “leveraging its disruptive exploration technology including Typhoon. It has also forged notable links with global mining powers Ma’aden and BHP through its 94.3-per-cent-owned owned Computational Geosciences Inc. (CGI).
“Our Outperform rating is based on the attractiveness of the Santa Cruz Copper Project, which has strong potential to fill a growing need for domestic U.S. copper production, additional exploration upside throughout IE’s portfolio, driven by advanced proprietary technology as well as management’s pedigree, including Executive Chair Robert Friedland, who is a leading mining entrepreneur. We believe the combination of these factors warrants a premium valuation to peers,” he added.
The analyst set a target of $18 per share, matching the average on the Street.
=====
TD Cowen analyst Tim James’s estimated equity value for FirstService Corp. (FSV-Q, FSV-T) in 12 months “continues to move steadily higher,” however he emphasized the “corresponding share price strength leaves us with an expected return that still requires a hold [rating].”
“We view the business very positively on many fronts, in particular the relatively resilient business lines and long-term M&A potential,” he said in a client note. “The current uncertain environment increases the relative appeal its resilient business model, but recommend investors wait for a lower forward valuation multiple entry point.”
In a note released Thursday, Mr. James updated his forecast for the Toronto-based residential property management company, seeing its share price discounting “strength of business, value in environment of trade uncertainty and return to target.”
“FSV reported strong Q2 results on July 24th, with adj. EBITDA and adj. EPS ahead of forecast (7 per cent and 20 per cent greater-than-forecast). We were encouraged to see organic growth rebound vs. Q1 (up 1.9 per cent year-over-year in Q2 vs. up 0.1 per cent in Q1),” he note. “FirstService Brands adj. EBITDA margin was materially higher-than-forecast (11.6 per cent vs. TD Cowen: 10.9 per cent) driven by operating efficiencies at its Restoration and Home Services businesses. Management believes recent Brands segment margin is sustainable, albeit likely to represent slowing y/y expansion through the balance of 2025. FirstService Residential adj. EBITDA was in-line. Organic growth (3 per cent vs. TD Cowen: 3 per cent) still affected by community budget pressure.
“2025 consolidated guide for high-single-digit revenue growth and adj. EBITDA margin expansion was reiterated (TD Cowen: 7.1 per cent and +50 bps expansion). Guide does not assume future named-storm revenue or M&A. Management expects FirstService Residential organic revenue growth to sequentially improve through Q4/25. We forecast a return to the midsingle digit growth in Q3/25.”
With its “hold” rating, the analyst raised his target by US$3 to US$214. The average is US$216.33.
“Adjusting target to reflect implementation of full Q2 financial disclosures in our model. Impact is immaterial to our view that there is potential upside to 2025 guide given H1 results, potential M&A and storm revenue,” he explained.
=====
In other analyst actions:
* Scotia’s Eric Winmill raised his target for shares of Dundee Precious Metals Inc. (DPM-T) to $28.50 from $26.50 with a “sector outperform” rating. The average is $30.37.
“With the Adriatic Metals acquisition now completed ... we have incorporated Adriatic’s Vares polymetallic mine into our estimates,” he said. “Importantly, we see the Adriatic transaction supplementing DPM’s production profile, particularly in 2026E and beyond when the Ada Tepe mine is scheduled to reach end-of-life. Furthermore, as production at Vares reaches steady-state, we see this mine providing free cash flow (FCF) which we expect will help fund capex requirements at the Coka Rakita mine. The addition of Vares also helps sustain annual production above 300koz AuEq with the addition of silver/zinc/gold/lead production. The net effect sees our NAVPS [net asset value per share] increase to $27.24(from $24.21).”
* CIBC’s Kevin Chiang raised his Transat AT Inc. (TRZ-T) target to $2.60 from $2.25 with an “underperformer” rating. The average is $3.27.