Inside the Market’s roundup of some of today’s key analyst actions
Touting its potential gains from the rise of agentic commerce, Scotia Capital analyst Kevin Krishnaratne upgraded Shopify Inc. (SHOP-Q, SHOP-T) to a “sector outperform” recommendation from “sector perform” rating on Thursday.
“We’ve always said that SHOP should be a core holding; now we’re saying buy the stock,” he said. “Agentic Commerce (A-Commerce) has arrived, and SHOP is ready to capitalize on an opportunity that has the potential to reshape the retail industry, similar to how E-Commerce fundamentally changed the structure of traditional commerce. It’s still early, but we do believe A-Commerce can be incremental to Total Retail, not simply a straight substitute for existing channels.
“We lay out a scenario in which SHOP could deliver GMV growth 300 bps faster than consensus of 23 per cent in 2026, with more aggressive assumptions putting growth closer to 37 per cent. ”In reality, our view is the A-Commerce opportunity will land somewhere in between and benefit SHOP for years to come."
In a client report released before the bell titled From E-Commerce to A-Commerce, Ready for Retail’s RenAIssance, Mr. Krishnaratne sees A-commerce, which involves the use of artificial intelligence to shop for users, “driving a ‘re-imagining’ of retail.”
“We see A-Commerce as enabling shopping powered by AI answer engines with purchase outcomes directly aligned with consumer preferences in a hyper-personalized, frictionless, and time-efficient manner,” he said. “GenAI’s ability to source and aggregate the collective wisdom of every product review, user experience, and expert opinion online to deliver recommendations that are perfectly matched to shoppers on a 1x1 basis could be a major unlocking of retail dollars benefiting commerce platforms like SHOP. If 2025 was the year when consumer AI adoption reached mass scale (ChatGPT pushing toward 1B MAUs), 2026 could be the year AI shopping and GMV monetization starts to inflect meaningfully higher, as trust in AI improves and on the back of recent payments innovations including Stripe’s Agentic Commerce Protocol (ACP), which launched in September alongside ChatGPT’s Instant Checkout.
“Three reasons we’re bullish on SHOP’s opportunity in an A-Commerce world: First, we think that the greater authenticity of results provided by answer engines can drive purchases for the long tail of niche SMBs selling on SHOP who serve as the fuel for its growth. Studies have shown that search results from LLMs return pages that would rank much lower using traditional organic search engines as AI systems are better tuned to a shopper’s intent. This helps level the playing field for SMBs vs larger retailers that have bigger ad budgets. Second, at a minimum, we expect A-Commerce to accelerate E-Commerce’s share of Total Retail which would benefit SHOP given its leadership position online; but we also see scenarios where A-Commerce expands the TAM for Total Retail (similar to how E-Commerce stimulated the TAM for Total Retail), and with it drives an increased GMV opportunity for SHOP. Third, SHOP’s early lead in providing A-Commerce tools for its merchants, such as Shopify Catalog and Agentic Storefronts, well ahead of peers is poised to drive merchant-add strength and other benefits (reduced churn, higher GMV/merchant).”
Mr. Krishnaratne raised his target for Shopify shares to US$200 from US$165. The average is US$179.27, according to LSEG data.
With Canadian life insurance companies having increased their return on equity targets over the last 12-18 months, CIBC World Markets analyst Paul Holden thinks further expansion “remains a core theme for the sector.”
“We analyze ROE expansion achieved to date, the quality of ROE expansion (including the benefit of IFRS 17), and the forward outlook for ROE and valuation implications. Despite achieving strong ROE expansion, we believe lifecos are not getting full credit for future ROE expansion, which we see as a reason to remain positive on the sector,” he said.
Mr. Holden’s upgraded ROE targets now imply an average target of 18.5 per cent, versus an adjusted ROE of 17.3 per cent 2025 year-to-date, which he noted suggests 120 basis points of further expansion is expected over the medium term.
“We compare target ROEs to 2027E ROEs implied by consensus to assess potential for positive EPS revisions,” he added. “We estimate 6-per-cent EPS upside on average. 2027 consensus estimates for MFC and SLF appear to be the most conservative.”
“The prospect for valuation expansion. This is the real question and discussion point on the ROE expansion topic. Should the lifecos trade at structurally higher multiples, both P/BV and P/E, as a result of higher ROEs? The answer on P/BV is a simple yes, in our view, and the entire group has already re-rated significantly. A P/BV vs. ROE regression suggests there could be some upside from multiple expansion as the lifecos move toward new ROE targets. MFC and SLF could benefit the most from P/BV multiple expansion. The answer on P/E is more complex, but we see a similar answer. High ROE regulated financials trade close to 13 times P/E, vs. 11.8 times for the Canadian lifecos. We see room for P/E multiples to move higher.
Citing “execution against medium-term targets, potential upside to consensus estimates based on medium-term objectives, and potential for further multiple expansion based on achieving its ROE objective,” Mr. Holden upgraded Manulife Financial Corp. (MFC-T) to an “outperformer” rating from “neutral” previously with a $58 target, up from $50. The average is $55.06.
“MFC’s refreshed strategy includes more ROE levers for ROE expansion, and this more diversified approach increases the probability of success, in our opinion,” he explained. “We estimate that 2027 consensus EPS could increase 8 per cent if MFC achieves its 18-per-cent ROE target. We have increased our 2026 and 2027 EPS estimates to give more credit for further ROE expansion and our revised 2027E results in an ROE of 17.1 per cent.”
Conversely, the analyst downgraded IA Financial Corp. Inc. (IAG-T) to “outperformer” from “neutral” with a $184 target, rising from $175 and above the $168.40 average.
“Execution has been strong and the stock has re-rated significantly,” he said. “We remain confident that management will continue to execute against its plan but believe this is well captured in consensus estimates and the valuation multiple. The stock has performed exceptionally well over the last 18 months and we think relative outperformance will be harder to achieve now that expectations and valuation multiples have both increased. Capital deployment, given excess capital, remains a potential source of upside relative to expectations.”
Mr. Holden also made these other target adjustments:
- Great-West Lifeco Inc. (GWO-T, “outperformer”) to $73 from $67. Average: $63.50.
- Sun Life Financial Inc. (SLF-T, “neutral”) to $95 from $93. Average: $90.61.
Ahead of the release of their fourth-quarter financial results, National Bank Financial analyst Cameron Doerksen sees “compelling” valuations for both Canadian National Railway Co. (CNR-T) and Canadian Pacific Kansas City Ltd. (CP-T).
“Based on our updated 2026 forecast, CN shares are trading at 16.8 times P/E [price to earings], which is well below the five-year forward average of 21.2 times for the stock,” he said. “Indeed, CN shares are trading below the valuation levels seen in the early stages of the pandemic when the volume outlook was arguably much more cloudy than is the case today. In addition, whereas CN has historically traded at a 1.5 turn premium to the U.S. rail peer group average, the stock is currently trading well below the U.S. peers, which trade at 19.5 times 2026 P/E, on average (all three U.S. rails are currently trading at a premium to CN boosted by the UP-NS proposed merger). CPKC shares are trading at 19.0xour updated 2026 EPS forecast, well below the 5-year average for the stock of 24.4 times and also below the U.S. peer average.
“We continue to favor CPKC over CN mainly because we expect CPKC’s volume and earnings growth will outperform CN through 2026.”
While Mr. Doerksen prefers CPKC from an investing perspective, he thinks its quarterly volumes “look a bit light” while believing rival CN is likely to fall in line with expectations.
“CN’s RTMs [revenue ton miles] in Q4/25 were up 4.2 per cent year-over-year, essentially in line with our expectations, and we expect the company will meet its full year 2025 guidance,” he said. “CPKC’s RTMs in Q4/25 were flat year-over-year which was weaker than our expectations and based on our updated forecast, we see CPKC falling short of 2025 guidance (10-14-per-cent EPS growth) with our full year EPS growth now estimated at 8.4 per cent.
“As for 2026 guidance, we expect CN will guide to EPS growth in the mid-single digits (current 2026 consensus is for EPS growth of 7 per cent year-over-year while we forecast 5.7-per-cent growth). For CPKC, we expect the 2026 EPS guidance to be in the 10-per-cent-plus range (current consensus is for growth of 14 per cent, and we are more conservative at 11.3-per-cent growth).”
Given that view, Mr. Doerksen trimmed his target for CPKC shares to $119 from $124, reiterating a “sector perform” rating. The average target on the Street is $118.97, according to LSEG data.
The analyst maintained his $150 target for CN shares along with his “sector perform” recommendation. The average is $153.86.
“Driven by new business wins and merger synergy-related gains, we expect CPKC volume and EPS growth will outperform CN’s growth in 2026,” he said.
“While both railroads face risks around tariffs/trade changes, we see CN more exposed to potentially weaker international intermodal in the near-term. We also highlight that a significant component of CN’s longer-term growth is related to international intermodal, with U.S.-bound containers via a Canadian port an important driver. This growth could be at risk due to tariffs and related changing trade flows. For CN, international intermodal makes up 65 per cent of its intermodal revenue versus CPKC at 45 per cent.”
Citi analyst Ariel Rosa thinks North American transportation companies “still have much to prove” in 2026, but he sees a “better” set-up for the year ahead “as tighter truck capacity supports higher rates.”
“The past few months reflect a remarkable reversal in sentiment for transports from the first 9 months of 2025 in which transports were largely out-of-favor with investors,” he said. “This deeply negative sentiment caused us to question in August 2025 whether transports had fallen victim to a mindset of ‘Infinite Sorrow’ from investors, even as we noted that this elevated caution had resulted in valuations for many stocks in our coverage which we perceived as reasonable relative to our view of normalized earnings potential. Cautious sentiment reflected 3 consecutive years of under-performance for transports stocks, with elevated freight capacity and tepid end market demand suppressing freight rates and creating the longest freight recession in a generation. Investor frustration has been exacerbated by multiple instances of ‘head-fakes’ over the last few years, in which an anticipated inflection in freight rates failed to materialize.
Following what he sees as a “prolonged period of weakness,” Mr. Rosa emphasized a recent surge in truckload spot rates over the last few weeks of 2025 “portends a more constructive freight environment in 2026.”
“From our perspective, we are more constructive on the prospects for a sustained increase in freight rates than at any time since we initiated coverage at Citi in 2024,” he added. “Whereas normal bottom-of-cycle conditions have been building for some time (falling class 8 net truck orders, rising levels of financial distress among carriers), suggesting a gradual rationalization of capacity was already underway, the true catalyst for the recent jump in spot rates has been government enforcement actions (JBHunt, 12/22/25) targeting non-compliant carriers, which in turn appears to be pushing the lowest-cost capacity out of the market. Even as transports continue to face sluggish freight demand from soft industrial activity (Reuters 1/5/26), depressed consumer sentiment (WSJ, 12/23/25), ongoing tariff uncertainty (Boston Fed, 9/5/25), and a challenging housing market (HD earnings, 11/18/25), the prospects for better supply-demand conditions in 2026 supported by higher freight rates leaves us optimistic on the prospects for transports to outperform the S&P500 for the first time in the past 3 years, narrowing the underperformance gap to the index.”
In a client report released before the bell, Mr. Rosa made a series of predictions for 2026 across the sector: “(1) Transports well-positioned to outperform S&P500 in year ahead following 3 years of underperformance; (2) Laggards of 2025 likely to be leaders in 2026 as stocks with cyclical torque benefit from recovery in freight rates, improving supply-demand; (3) Rails still defensive with potential for modest multiple expansion; look for Canadian rails to narrow valuation gap to US rails, rising likelihood CSX gets takeout offer by year-end; (4) Parcels still cheap with potential for 2H26 margins to surprise to the upside; improving narratives into ’27 support advance from ‘trough-on-trough’ levels; (5) Trucking stocks have gotten harder, early upside has been realized, downgrade JBHT, XPO; (6) LTL gains likely constrained by multiple compression, expect dispersion in returns; (7) Brokers face tough 4Q25, CHRW negative catalyst watch; (8) Everything transports hinges on rising truckload rates, moderate return expectations without macro/demand acceleration.”
He named two Canadian companies among his top picks for the year-ahead:
* Canadian Pacific Kansas City Ltd. (CP-N, CP-T) with a “buy” rating and $88 target. The average is US$85.83.
Analyst: “Canadian rails trade at one of their largest discounts to U.S. rails of the past decade, leaving valuations reasonable, in our view. CP continues to outpace the industry in both volume and earnings growth, warranting a valuation premium that has largely disappeared in recent years. Its Canadian peer CNI committed to a more disciplined approach to capex in 2026, raising prospects for stronger FCF in the year ahead.“
* TFI International Inc. (TFII-N, TFII-T) with a “buy” rating and US$131 target, up from US$106. The average is US$111.62.
Analyst: “Within LTLs, we note TFII and ARCB as among our top picks, as both companies have under-appreciated FCF potential, in our view. Whereas their union structure is an understandable point of concern for many investors, we also note that their thin margin profile allows for meaningful earnings upside on cycle inflection. Additionally, given their valuation multiples below their non-union peers, we see less room for multiple contraction as earnings growth accelerates, with the onus on management to navigate union challenges and to leverage their solid FCF to drive shareholder returns."
Mr. Rosa’s other top picks are: ArcBest Corp. (ARCB-Q) with a “buy” rating and a Street-high US$104 target, up from US$83, Union Pacific Corp. (UNP-N) with a “buy” rating and US$265 target (unchanged) and United Parcel Service Inc. (UPS-N) with a “buy” rating and US$126 target, rising from US$120. The averages are US$82.50, US$265.07 and US$105.88, respectively.
The analyst trimmed his target for Canadian National Railway Co. (CNI-N, CNR-T) to US$119 from US$120, keeping a “buy” rating. The average is US$111.
Ahead of the release of 2026 operating guidance for many North American miners, Scotia Capital analysts are predicted “relatively tight commodity markets in 2026, particularly in copper, supported by supply side challenges at several large operations.”
“We forecast 2026 to be a relatively solid year for most of our coverage, driven by improved operating performance and robust commodity prices, driving higher FCF generation,” they said. “CCO, CS, and FCX are top picks. We also highly recommend CIA, ERO, FOM, HBM, IVN, and LUN.”
“We note that ANTO, CCO, FM, HBM, and LUN have the best track record of meeting operating guidance over the past two years; conversely, TECK has demonstrated the weakest performance. We have also made several commodity price changes, including higher near-term Cu prices, and further increased equity multiples and targets for most companies (17-per-cent average target price increase). Finally, we have updated our implied Cu price in equities analysis and reviewed current valuations.”
For large-cap producers, their target changes include:
- First Quantum Minerals Ltd. (FM-T, “sector perform”) to $41 from $35. The average is $34.72.
- Ivanhoe Mines Ltd. (IVN-T, “sector outperform”) to $20 from $18.50. Average: $18.78.
- Lundin Mining Corp. (LUN-T, “sector outperform”) to $31 from $25. Average: $26.96.
- Teck Resources Ltd. (TECK.B-T, “sector perform”) to $70 from $60. Average: $63.61.
For their top picks, the analysts changes are"
- Cameco Corp. (CCO-T, “sector outperform”) to $155 from $150. Average: $147.14.
- Capstone Copper Corp. (CS-T, “sector outperform”) to $18 from $16. Average: $15.
- Freeport-McMoRan Inc. (FCX-N, “sector outperform”) to US$63 from US$47. Average: US$52.06.
Desjardins Securities analyst Brent Stadler sees Capital Power Corp.’s (CPX-T) U.S. recontracting announcements as “very capital-light (low-risk), highly NAV accretive growth opportunities, which should be well-received by investors.”
On Wednesday, the Edmonton-based company announced it has extended the contract term on a summer tolling agreement with the current counterparty, an investment-grade utility, at its 600-megawatt Arlington Valley asset in Arizona to 13 years, and under the new power purchase agreement (PPA) term has increased the EBITDA profile by 150 per cent, which Mr. Stadler thinks “warrants multiple expansion.”
“We believe CPX is just getting started on growth opportunities in Arizona and we could hear about expansion opportunities at the Arlington Valley site in the short term,” he said.
“The recontracting suggests significantly more terminal value in gas assets than we model, reinforcing that natural gas is key to long-term grid reliability.”
In a client note, Mr. Stadler laid out four drivers of material value creation from a long-term contract on a gas asset: “(1) We estimate the recontracting uplift adds $2.00 of NAV/share and is the driver of our target increase; (2) the long-term contract de-risks cash flows, which should drive multiple expansion on the asset; (3) executing on this initiative coupled with the prior Midland recontracting has positive read-through to CPX’s four other contracted U.S. gas assets. CPX is engaged in recontracting discussions on these assets with multiple counterparties, and we expect more announcements in the future (1–2 per year); and (4) 13-year contract times should allow CPX to add leverage, which could fund additional highly accretive U.S. gas M&A."
Maintaining his “buy” rating for Capital Power shares, he raised his target by $2 to $82. The average is
“CPX remains a preferred name,” he concluded.
National Bank Financial analyst Alex Terentiew sees Highlander Silver Corp.’s (HSLV-T) $141-million, all-share acquisition of Bear Creek Mining Corp. as a “a positive, value-accretive transaction that added scale and more silver leverage, at an attractive value, while also strengthening its position as a future producer in Peru."
“On a fully-financed basis, we estimate a transaction value of approximately $250-million, equating to an attractive P/NAV multiple of 0.23 times,” he said. “With the acquisition, Highlander now owns two prominent development projects in Peru. We assume Highlander will spend the next several years advancing exploration at Corani, including updating the FS, with our base case assuming first production in 2032. We expect Mercedes will likely be divested in due course.”
In a research note titled Reinvigorating a World-Class Silver Project, Mr. Terentiew emphasized the deal, which was announced on Dec. 19, is “significantly” accretive to the Toronto-based miner’s net asset value after adding “another high profile project (Corani) to Highlander’s portfolio, complementing the ongoing advancement of its high gold and silver grade San Luis project, while also bringing on immediate production from Mercedes, although we believe the mine will be ultimately divested.”
“We incorporated Corani into our model based on the 2019 feasibility study, adding additional cost and capex as necessary, generating a project NAV of $940-million. ”We ascribe a US$50-million credit for Mercedes, resulting in our NAVPS increasing 49 per cent. In our view, given today’s bullish silver market, along with the management team’s track record and strategy, we believe this is the right combination to reinvigorate activities at Corani and put the project back on track towards production. Corani gives Highlander scale, while San Luis gives potential for near-term high-margin cash flow, which will aid in the financing of Corani.
“Pro forma company remains debt free. Despite Bear Creek holding a significant amount of liabilities through loans, converts and streams, Highlander was able to restructure the company through a one-time cash payment of US$10.2-million upon closing, as well as granting additional royalties to Royal Gold and Equinox. As a result, we see Highlander in a strong financial position to advance work at both projects without the immediate need to raise additional funds.
Reaffirming his “outperform” rating for Highlander shares, Mr. Terentiew raised his target to $8 from $6. The average target on the Street is $6.25.
While investors weren’t impressed with the preliminary fourth-quarter results from Kits Eyecare Ltd. (KITS-T), Desjardins Securities analyst Frederic Tremblay sees “a strong growth outlook and 2026 margin catalysts.”
Shares of the Vancouver-based eyecare provider plummeted 8.9 per cent after it announced preliminary revenue of $53.9-million, up 20 per cent year-over-year, ahead of the Street’s forecast of $52.9-million and at the higher end of the $52–54-million guidance. However, due to a weaker-than--anticipated adjusted EBITDA margin, adjusted EBITDA is seen to be $2.2–2.7-million, below the consensus of $2.8-million.
“We view the share price reaction that followed the release of preliminary 4Q25 results as overdone,” said Mr. Tremblay. “In our view, while the update did not contain a 4Q beat, it did reinforce the attractive growth story. In addition, we believe that recent margin performance reflects a very strong pace of customer additions (eg marketing, less profitable first-time orders), which should translate into a much larger base of higher-margin repeat customers in 2026 and beyond.”
“4Q caps off a strong 2025 for KITS, including full-year revenue rising 27 per cent to $202.5-million. The growth outlook remains superb, in our view. In addition to its sizeable (and growing) contact lens business, KITS is making headway in glasses, as illustrated by record quarterly revenue of $8.7-million (up 33 per cent year-over-year) from glasses in 4Q. We see major runway for KITS in this category as the glasses market is estimated to be 4 times the size of the contact lens market. We increase our 2026 revenue forecast to $246.7-million (from $240.8-million), representing 22-per-cent year-over-year growth.”
The analyst now sees fourth-quarter margin components potentially fuelling 2026 tailwinds.
“Although 4Q is the second consecutive quarter with a margin in the lower half of the guidance range, we believe that both the 2025 marketing spend to seize customer addition opportunities and the transient margin headwind associated with these customers’ first-time orders are positioning KITS for strength in 2026 when the larger customer base is expected to drive incremental higher-margin repeat purchases,” he explained. “Our 2026 margin expectation of 7.0 per cent (7.4 per cent previously) represents a step-up from 2024’s 4.0 per cent and our 2025 forecast of 5.5 per cent.”
While he trimmed his earnings expectations for both 2026 and 2027, Mr. Tremblay reaffirmed his “buy” rating and $23 target for Kits shares. The average is $23.85.
“We view the share price reaction (down 8.9 per cent) as overdone and note that it came following strong share price performance in the weeks leading up to the 4Q pre-release as some investors may have anticipated a beat,” he added.
In other analyst actions:
* UBS’ George Eadie initiated coverage of HudBay Minerals Inc. (HBM-T) with a “buy” rating and $34.50, touting its strong growth potential and projected a 55-per-cent increase in copper production from 2025 levels by 2030. The average target is $27.96.
* BofA Securities’ Rock Hoffman downgraded Sigma Lithium Corp. (SGML-Q, SGML-X) to “underperform” from “neutral” with a US$13 target, rising from US$11 and above the US$11 average.
* Canaccord Genuity’s Carey MacRury became the first to initiate coverage of Evolve Royalties Ltd. (EVR-CN), giving the Toronto-based company, formerly known as Voyageur Minerals Explorers Corp., with a “buy” rating and $4.25 target.
“Evolve is a new royalty and streaming company focused on building a diversified portfolio of royalties and streams in copper and other critical metals with a target weighting of 75-per-cent copper and 25-per-cent other strategic metals. The company went public via an RTO in December 2025,” he said.
“Balance sheet geared for growth: The company has ~C$40 million in cash and no debt. We believe the company could fund new acquisitions with cash on hand, potential debt financing, and/or acquiring assets with its shares. Given Evolve’s management track record of sourcing deals, we believe the company is well-positioned to source copper royalty and streaming opportunities against a backdrop of strong copper demand driven by decarbonization, electrification, and AI data centre demand and the associated capital requirements to fund new copper supply.”
* Canaccord Genuity’s Yuri Lynk initiated coverage of 5N Plus Inc. (VNP-T) with a “buy” rating and $26 target, exceeding the $23.50 average on the Street.
“5N Plus is a key global supplier of ultra-high purity (99.999 per cent or five-nines purity) advanced materials and specialty semiconductors. The company enjoys a wide competitive moat in its ability to source and process minor metals outside China, helping its customers meet domestic content requirements. 5N Plus’ compounds and wafers are critical to the functioning of its customers’ products yet comprise an insignificant portion of the overall production cost. Growth alongside key customers has adjusted EPS set to nearly triple in 2025 with 11-per-cent growth on tap for 2026, according to our forecast. The stock trades at 13.1 times EV/EBITDA (2026E), a discount to the advanced materials group at 14.9 times despite our view of 5N Plus’ superior growth prospects in terrestrial and space solar power. Additionally, management are proven acquirers and looking to put 5N Plus’ underleveraged balance sheet to work via acquisition. Any associated accretion would be additive to our forecasts,” said Mr. Lynk.