Inside the Market’s roundup of some of today’s key analyst actions
RBC Dominion Securities analyst Drew McReynolds thinks Canadian telecommunications investors will “stare at another transition-like year” in 2026, predicting “the relative winners will be the operators that exceed expectations with respect to the controllables – execution on new revenues, EBITDA/FCF margin expansion and balance sheet/crystallization initiatives."
In a client report released before the bell, he said the set-up across the industry heading into first-quarter earnings season appears to be “underwhelmingly promotional.”
“Following a constructive two steps forward on the wireless pricing environment through the majority of 2025, we believe elevated promotional intensity through Q1/26 represents at least one step back for the industry,” he explained. “With Q1 the seasonally low period for wireless loading and with the bulk of wireless promotional activity removed in early April alongside select core price increases, we do not expect this step back for the moment to translate to downward revisions to 2026 guidance for the Big 3. However, we believe any continuation of such elevated promotional intensity as the year progresses would increasingly begin to bring 2026 guidance ranges into question putting renewed downward pressure on valuations and putting fragile investor sentiment to the test.
“For Q1/26, we expect: (i) a sequential improvement in Big 3 average network revenue growth to 0.5 per cent year-over-year (versus flat year-over-year in Q4/25) factoring in Big 3 wireless net additions of 43k (versus 54k in Q1/25) and ongoing ARPU [average revenue per user pressure of negative 1.6 per cent year-over-year (versus down 1.7 per cent year-over-year in Q4/25); and (ii) stable average underlying wireline revenue growth alongside steady Internet net additions and modest Internet ARPU growth.”
Mr. McReynolds did indicate the industry could be “finally on the cusp” of underlying return on invested capital improvement, seeing “a reasonable likelihood” that 2025-2026 could finally represent the trough as “capex intensity eases, mmWave spectrum outlays become less onerous versus low-band and mid-band spectrum, the cost to serve is systematically lowered while optimizing base management and potential further industry/asset consolidation plays out.”
“Should the Canadian telecom industry in fact be in transition to a more mature industry (implying meaningful new revenue streams ultimately fail to materialize), we believe it is incumbent upon boards and management teams to shift emphasis (i.e., strategic/tactical priorities, executive compensation, commission structures etc.) from chasing uneconomical and/or capital-destroying revenue growth to maximizing FCF and ROIC,” he added.
For investors, he summarized his outlook as “a maturing industry until proven otherwise.”
“Despite further wireless penetration gains, some core price increases and the emergence of incremental revenue streams (enterprise, IoT, home automation etc.), we continue to expect the revenue recovery for the industry in 2026 to remain gradual reflecting minimal population growth, Q1/26 wireless promotional activity that appeared elevated on a year-over-year basis, regulatory headwinds (roaming, the CRTC-imposed elimination of select fees), ongoing substitution (telephony, television) and macro headwinds,” he explained.
“Until proven otherwise, we expect what looks to be a maturing Canadian telecom industry in a low revenue growth environment warrants greater emphasis on lowering the cost to serve (both opex and capex) to drive FCF, improve ROIC and sustain/enhance capital returns. We continue to view sector valuations as reasonable with the Big 3 trading in a FTM [forward 12-month] EV/EBITDA range of 6.3-7.7 times (versus a cyclical peak of 8.5-10.0 times in April 2022 and recent cyclical low of 5.8-7.8 times in April 2025) with the average multiple for the group at 6.8 times and near the low-end of the recent historical average of 6.5-8.0 times.”
With adjustments to his forecast for companies in his coverage universe, Mr. McReynolds made a trio of target revisions:
* Cogeco Communications Inc. (CCA-T, “sector perform”) to $77 from $76. The average target on the Street is $75.79, according to LSEG data.
Analyst: “Despite competitively intense operating environments in Canada and the U.S., management continues to execute on multiple growth initiatives that include rural broadband expansion North American wireless penetration, digitization, and Canadian Broadband and America Broadband integration. While we remain on the sidelines given the challenged revenue environment and ongoing elevated competitive intensity in the U.S., we continue to see value in the stock and look for better visibility on potential catalysts that could include an eventual uptick in revenue growth (driven by footprint expansion, price increases and/or wireless entry), the eventual realization of greater-than-expected synergies, and/or any potential easing in U.S. competition/concerns.”
* Quebecor Inc. (QBR.B-T, “sector perform”) to $60 from $57. Average: $59.88.
Analyst: “Despite strong performance driven mainly by multiple expansion (from 6.1 times FTM EV/ EBITDA at the beginning of 2025 to 7.8 times currently), we continue to see a reasonable risk-adjusted return profile for the stock. We believe the driver of further upside in the shares from current levels will be primarily NAV growth (bolstered by healthy FCF generation and a relatively low payout ratio), albeit with the potential for further multiple expansion should the company deliver a sustainable step-up in EBITDA growth from 2-3 per cent currently to mid-single digits bolstered by the flow-through of renewed wireless and Internet ARPU growth.:
* Telus Corp. (T-T, “outperform”) to $22 from $23. Average: $20.16.
Analyst: “TELUS maintains a premium valuation relative to large cap peers suggesting a higher performance bar must be met in what remains a low revenue growth environment. While this premium valuation comes with a degree of valuation risk, we believe TELUS as the structural leader within the group can maintain a premium valuation provided that certain boxes continue to be ticked through 2026-2028, including: (i) sustaining 3 per cent or higher adjusted EBITDA growth systematically realizing cost efficiencies; (ii) continuing to make progress towards management’s 10-per-cent consolidated capex intensity objective; (iii) delivering on its newly-provided 2026-2028 FCF CAGR outlook of a minimum of 10 per cent; (iv) turning the discounted DRIP off by the end of 2027; (v) reducing leverage to 3 times by 2027 while pausing on major M&A; and (vi) ultimately instituting a recurring NCIB longer- term to absorb excess FCF given at optimal leverage underpinned by the structural decline in capex.”
He maintained his targets for:
* BCE Inc. (BCE-T, “outperform”) at $39. Average: $38.73.
Analyst: “We continue to believe current share price levels represent an attractive entry point reflecting what should be a gradual and sustained re-acceleration in underlying revenue and adjusted EBITDA growth beginning in 2026 driven by both differentiated and diversified growth tailwinds (Ziply, Enterprise, Bell Media) against the backdrop of a gradually improving wireless pricing environment in Canada. At an FTM EV/EBITDA multiple of 7.0 times, we see the potential for modest multiple expansion as management executes on its 2026-2028 outlook, which in our view, has contributed meaningfully to earnings visibility relative to Canadian peers. Our forecast continues to be more conservative relative to the updated 2026-2028 outlook leaving the potential for upside earnings surprises.”
* Rogers Communications Inc. (RCI.B-T, “outperform”) at $61. Average: $57.25.
Analyst: “We continue to see an equity reflation story for Rogers driven by FCF generation, outright debt repayment given the relatively low dividend payout ratio (less than 30 per cent of FCF), and further progress on balance sheet de-levering that now includes the completed $7-billion structured equity investment and a clear path for crystallizing a minority interest in the sports and media assets. We view the recent pullback as a buying opportunity and we continue to see value in the stock, particularly should: (i) the operational environment show further improvement; (ii) any meaningful minority interest transaction in the sports and media assets be supportive of management’s estimated more than $20-billion valuation; (iii) capex intensity continue to ease following 2-3 years of significant investment post the Shaw acquisition; and (iv) visibility on enhanced capital returns increase as leverage approaches 3 times.″
Canaccord Genuity analyst Aravinda Galappatthige is “moving to the sidelines” on Telus Corp. (T-T), lowering his rating to “hold” from “buy” ahead of the May 8 release of its first-quarter results.
“While the quarter itself is likely on-trend with recent results, we believe that ongoing discounting battles in wireless and renewed evidence of low population growth (StatsCan) likely impacting volumes, suggests the prospect of an even flatter financial trajectory than expected,” he said. “This, together with still low visibility on the timing of asset divestitures and by extension dividend sustainability, moves us to the sidelines.”
Mr. Galappatthige is now projecting adjusted EBITDA will rise 2.1 per cent year-over-year to $1.88-billion, narrowly exceeding the consensus estimate on the Street of $1.876-million. While he expects free cash flow to jump 13 per cent, he sees earnings per share falling 4 cents from the same period a year ago to 22.
“We believe that the EBITDA growth will once again be assisted by TELUS Health (up 18.4 per cent year-over-year) with core Telecom (TTECH segment) up only 0.8 per cent,” he added.
“Wireless service revenue in positive territory but promos threaten recovery: We expect TELUS to post 0.5-per-cent service revenue growth in Q1, a tick up from 0.3 per cent in Q4/25 and negative previously. We also have 22k mobile net adds, up from 20k last year and likely ahead of incumbent peers (but not Quebecor). Although this suggests a somewhat constructive picture, we believe that the heavy promotional intensity in the market through much of Q1, if sustained, compromises the thesis around even a slow recovery. This is also due to the low volume growth available to carriers as low population growth and high wireless penetration starts to pressure market growth to, or possibly below 2 per cent, barely enough to offset ARPU declines.”
After a reducing to his valuation for Telus, he lowered his target to $17.50 from $21. The average is currently $20.16.
“While we still see a path to getting the management definition FCF to surpass the current dividend, likely by 2028, we recognize a fair bit of uncertainty around the medium- to long-term sustainability of the current dividend,” he added. “We note that management’s comments on the Q4 call were somewhat assuring in that they referred to the board’s approval for their three-year plan as recently as December 2025 and “all that that entails’. This suggests some continuity around dividend policy. However, we weigh that against risks of further pressure on wireless economics as discussed above and some uncertainty around key asset divestitures, particularly related to TELUS Health (TH). We suspect that in the absence of a successful partial monetization of TH and further pressure on wireless (to which TELUS still has near 60-per-cent EBITDA exposure), the current dividend itself could be on the table. This thesis could be further reinforced when one considers the leadership transition and the natural preference of the incoming leadership to start with a ‘cleaner slate’ in terms of dividend payout.”
Scotia Capital analyst John Zamparo is “expecting a pause” from Canadian grocers in the first quarter, leading him to downgrade the three stocks in the sector.
“We believe near-term risks skew to the downside for the grocers, a product of medium-and-short-term outperformance, lower expected core earnings growth this year, and recent results that missed on key metrics, which could signal the more competitive environment we have been expecting,” he explained. “We consider these solid, stable businesses that offer low volatility and predictable growth, and they will be foundational to many investors’ portfolios. However, we see an absence of near-term catalysts and we prefer to be adding at lower valuations, as our returns to target are all less than 8 per cent.”
In a report released before the bell, Mr. Zamparo said the results from the fourth quarter of fiscal 2025 displayed “some signs of tougher times.”
“CQ4 broadly showed further deceleration in SSS [same-store sales] and GM% [gross margin] expansion,” he saud. “SG&A discipline meant EBITDA and EPS were healthier. That each of the grocers has missed key consensus numbers (SSS, GM%) in greater frequency the last two quarters points to a more competitive market, in our view. We believe each of L, MRU and EMP are seeing negative same-store tonnage and this may persist through C2026. We believe elevated store growth industry-wide is having an impact, while much of the square footage expansion from WMT and COST is still on the way. We update our expectations for store growth and population growth .... Versus our last update, we note a modestly improved outlook (though still negative), mostly from higher population assumptions.
“Key items to be mindful of this quarter: this is Empire’s first full quarter following its announcement to exit the Alberta CFC [customer fulfillment centre]; both EMP.a and MRU are lapping quarters with various SSS supports (holiday calendar shift for MRU; partial ecomm launch for EMP.a); cough & cold season looks less likely to meaningfully contribute to SSS; and challenging weather.”
The analyst moved Empire Co. Ltd. (EMP.A-T), Loblaw Companies Ltd. (L-T) and Metro Inc. (MRU-T) to “sector perform” recommendations from “sector outperform” previously, while he maintained their targets of $52, $70 and $103, respectively. The averages on the Street are $52.50, $71.13 and $105.50.
Expecting “significant” growth in the years ahead, National Bank Financial analyst Vishal Shreedhar initiated coverage of Aritzia Inc. (ATZ-T) with an “outperform” recommendation, believing its premium valuation is “justified given its superior long-term operating performance, and opportunity for further EBITDA margin and ROIC expansion.”
“ATZ has a compelling growth runway reflecting its ongoing successful expansion in the U.S., future international expansion potential and a multiyear opportunity for margin expansion driven by operating leverage, mix, efficiencies (supply chain, purchasing, etc.) and selective pricing,” he added. “Notably, ATZ’s balance sheet is solid with net-debt-to-EBITDA of 0.8 times in F2026E and 0.4 times in F2027E. Given excess cash generation, NBCM models a share repurchase program (in excess of antidilution).”
In a client report titled High quality is always in fashion, Mr. Shreedhar called the Vancouver-based clothing retailer’s opportunities to gow “compelling” and sees it expansion south of the border “building momentum” alongside opportunities internationally.
“ATZ’s current growth focus is the U.S.; ATZ currently operates in 39 markets (cities) across 25 states and Washington, D.C. (13 cities in Canada),” he added. “U.S. boutiques are guided to be 60 per cent of network by F2027E (51 per cent currently; NBCM models 56 per cent). Given ATZ’s success in the U.S. (63 per cent F2026E sales mix, up from 34 per cent in F2020; U.S. sales CAGR [compound annual growth rate] of 38 per cent over same time period), we are supportive of further expansion. ATZ believes there is opportunity for 180-200 boutiques in the U.S. Using Canada’s store density as a blue-sky benchmark, the U.S. could support more than 550.
“Longer term, ATZ has international growth opportunities; we believe ATZ has already achieved the critical mass necessary for expansion outside of the U.S. We expect the ongoing U.S. expansion to be the key medium-term driver of the stock.”
In justifying his bullish stance, Mr. Shreedhar also pointed to the company’s “high store productivity and disciplined inventory,” which he thinks has built a “credible growth runway.”
“ATZ’s strength is its superior store productivity (highest amongst our apparel group), supported by its brand promise and disciplined inventory control (primarily stocked with proven sellers),” he said. “The key medium term growth drivers will be continued expansion into the U.S. and opportunity for EBITDA margin expansion (our F2027E EBITDA margin of 18.3 per cent could prove to be conservative).
“Our analysis of more than 5,000 customer reviews points to mixed brand perception. If ATZ’s premium pricing exceeds customer’s perception of product quality (future pricing expected to accelerate), growth ambitions could be impacted. Other key risks include a volatile/competitive industry backdrop which is economically sensitive.”
The analyst set a target of $143 for Aritzia shares, pointing to an estimated total return of 25.3 per cent. The average target on the Street is $157.86.
Ventum Capital Markets analyst Amr Ezzat sees Blackline Safety Corp.’s (BLN-T) agreement to be taken private by U.S. private equity firm Francisco Partners in a deal valued at up to $850-million as “a strong outcome, particularly in the context of the current market environment for small-cap technology, and reflective of the company’s continued execution.”
In response to Wednesday’s premarket announcement, which sent shares of the Calgary-based connected safety monitoring technology company soaring 25.6 per cent, Mr. Ezzat moved his recommendation to “tender” from “buy” previously.
“The transaction follows a period of consistent operational progress, with Blackline demonstrating durable ARR growth, strong net dollar retention, and a clear path toward improving profitability,” he explained. “At $9.00 per share, the implied valuation of 4.4 times fiscal 2026 estimated sales and 30.7 times F2027E EBITDA (rising to 4.7 times and 32.4 times at full CVR [contingent value right] payout) reflects a business that has transitioned toward a higher-quality, recurring revenue model with improving visibility.
“Structure preserves participation in continued ARR growth: The inclusion of a CVR tied to ARR targets allows shareholders to participate in further upside as the business continues to scale. The required ARR thresholds imply continued growth from the current $90-million base, consistent with the trajectory discussed by management. In this context, the structure aligns well with the company’s ongoing transition toward a more software-driven model. The structure is back-end loaded, with no payout below $145-million ARR and a full payout above $149-million. Based on our estimates, this implies Blackline must deliver 33-per-cent CAGR in ARR from October 2025 levels to achieve the full payout, while 31-per-cent CAGR or below results in no payout. In our view, this creates a relatively narrow window for value realization, effectively positioning the CVR as a high-growth execution lever rather than base-case consideration. The CVR is payable only at maturity, carries no interim cash flows, and is non-transferable, which supports a meaningful discount to the headline value. As such, while the transaction value reaches up to $9.50/shr, we expect the CVR to be treated as contingent upside rather than core consideration.”
Mr. Ezzat also emphasized 31 per cent of shareholders, including management and key strategic holders, are rolling equity into the new private entity and contributing capital, which he called “a positive signal, indicating confidence in the company’s longer-term growth profile and alignment with the next phase of value creation.”
“Since our launch, our thesis has centered on Blackline’s shift toward a connected workforce platform, with recurring services becoming the primary driver of value,” he added. “This transaction outcome is consistent with that evolution, as the business has reached a level of scale and predictability that supports private ownership focused on continued ARR expansion and operational efficiency.
“In summary, we view the transaction as a strong and well-timed outcome for shareholders, delivering an attractive premium and immediate liquidity, while retaining exposure to continued execution through the CVR structure.”
His target for Blackline shares moved to $9 from $8.25. The average is $9.67.
Citi analyst Alexander Hacking thinks a relative valuation gap has “opened up” for Ivanhoe Mines Ltd. (IVN-T), but he warns of “a long road to win back investor confidence.”
He has updated his forecast for the Vancouver-based miner following last week’s update to its Kamoa Kakula Copper Complex mine plan, which saw a reduction its 2026/2027 production guidance by 23 per cent.
“The company has reset expectations pushing back the recovery to 500kt copper by one year (2028 vs 2027) to allow for more development work; plus lowering the grade profile to account for mine design dilution and lower cut-off,” Mr. Hacking said.
“IVN stock has underperformed peers by approximately 100 per cent since the May 2025 seismic incident with our NAV impaired by 30-40 per cent, representing a material de-rating. Simplistic EV/ton valuation has fallen to $50k/ton (US$10-billion/ 500kt times 40 per cent) – similar to other copper miners with ongoing issues – FCX (Grasberg), FM (Panama) and TECK (QB2) – but well below ANTO closer to $100k/ton. Platreef and Western Forelands now appear to have negligible value in the stock. That said, our conversations with investors suggest no rush to jump back in with management facing a long road to rebuild confidence."
Reducing his projections through 2027, Mr. Hacking noted his net asset value on Kamoa Kakula is down 35 per cent from prior to a May 2025 seismic incident from which the company is still recovering
“The new mine plan maybe too conservative – but IVN’s main job now is to demonstrate to investors that it can sustainably manage a multi-decade asset vs pushing for maximum near-term tons, in our view," he emphasized.
Keeping his “buy” rating for Ivanhoe shares, he cut his target to $13 from $18. The average target is $14.30.
"Citi is long-term bullish copper, and we believe IVN offers investors the best growth profile in our global coverage," he said.
In other analyst actions:
* BofA Securities’ Ken Hoexter upgraded Canadian National Railway Co. (CNI-N, CNR-T) to “buy” from “neutral” and raised his target to US$122 from US$117. The average is US$111.04.
* In a report previewing quarterly results for Canadian transportation companies, Scotia’s Konark Gupta made a series of target adjustments. He raised his targets for Canadian National Railway Co. (CNR-T, “sector outperform”) to $160 from $155, Canadian Pacific Kansas City Ltd. (CP-T, “sector outperform”) to $122 from $120, Mullen Group Ltd. (MTL-T, “sector perform”) to $19 from $18.50 and TFI International Inc. (TFII-T, “sector perform”) to $170 from $165. Conversely, he lowered his Cargojet Inc. (CJT-T, “sector outperform”) target to $115 from $118. The averages are $153.82, $127.09, $17.50, $172.75 and $117.88, respectively.
“We are slightly more constructive on the freight sector heading into earnings. Although our improved Q1 estimates are still shy of the Street, we are encouraged by the continued rise in spot trucking rates (up 24 per cent year-to-date, led by flatbed), mostly on the back of capacity pressure and higher fuel prices as opposed to demand recovery. This may lead to higher contract rates heading into 2027-28, similar to 2022 when the freight cycle peaked. That said, demand is less likely to match 2022 levels soon due to the lack of stimulus, depleted excess savings, inflation effects, geopolitical noise, USMCA/tariff risks, and now fuel prices. Overall, we expect the companies to maintain full-year guidance or provide quarterly outlook in line with expectations, while sounding more positive than last quarter. However, investors should be ready for some volatility in quarterly revenues and margins due to ongoing significant fluctuations in the oil price, considering fuel surcharges represent 1%-12 per cent of revenues for our covered rails and trucks. We continue to prefer our SO-rated CJT (deep value), CNR (low bar), and CP (growth leader) over SP-rated MTL and TFII, which are riding on high investor expectations due to spot market trends,” said Mr. Gupta.
* Following site visits to its Cambridge Fabrication & Modularization Facility and the Goreway Battery Energy Storage System, RBC’s Sabahat Khan raised his Aecon Group Inc. (ARE-T) target to $44 from $41 with a “sector perform” rating. The average is $45.75.
“A central theme of the day was the extent to which Aecon’s business has transformed over the past 5 years. Namely, Nuclear + Utilities segments now account for 50 per cent of revenues (up 2 times vs. 25 per cent in 2020), while legacy fixed-price projects are a smaller part of the mix (see here for more). We believe this evolution has led to a more attractive risk/reward profile in the company’s backlog (27-per-cent fixed-price as of yearend 2025 vs. 42 per cent for 2024), with good visibility to a pipeline of work over the near- to medium-term (more than 45 per cent of the backlog stretching beyond 2 years, several programs extending into the 2030s),” said Mr. Khan.
* In response to an $8-million private placement with L6 Holdings, Canaccord Genuity’s Yuri Lynk increased his Decisive Dividend Corp. (DE-X) target by $1 to $9 with a “hold” rating. The average is $9.75.
“Management’s operational focus and a recovery in key end-markets drove a nice rebound in DE’s per share and leverage metrics in 2025, a year when acquisition activity was minimal. Last month, management signalled it expected to resume its typical pace of acquisitions in 2026 as the company is better positioned to integrate them than a year ago. Enter L6 Holdings, the family office controlled by the Leonard family, including Constallation Software’s (CSU) founder and long-time president, Mark Leonard. Mr. Leonard built CSU through hundreds of small acquisitions, so the importance of having his tacit approval of DE’s business model and outlook cannot be overstated. L6 now owns 12 per cent of DE,” said Mr. Lynk.
* Barclays’ Theresa Chen hiked her Keyera Corp. (KEY-T) target by $5 to $53 with a “equal weight” rating. The average is $55.60.
“Investor focus centers on downside risk to KEY if the PAA transaction fails to close as planned. While macro tailwinds currently support octane economics, the AEF outage is likely to pressure 1Q26 earnings. The fee-based segments remain stable with visible growth ahead,” said Ms. Chen.
* Raymond James’ Craig Stanley initiated coverage of Luca Mining Corp. (LUCA-X) with an “outperform” rating and a target price of $3.50. The average is $3.63.
“LUCA owns the Campo Morado and Tahuehueto Mines in Mexico,” he said. “Management plans to announce a study later this year on Campo Morado that we model will double the company’s production in 2029.”
* In a note titled Good Things Come to Those Who Wait, RBC’s Ryland Conrad moved his North West Company Inc. (NWC-T) target to $63 from $60, which is the average, with an “outperform” rating, while BMO’s Stephen MacLeod raised his target to $63 from $56 with an “outperform” rating.
“Q4/25 results were modestly ahead of our forecast. While headwinds in Canada are expected to persist in Q1/26, we see a more favourable set-up for the stock in 2026 as settlement payments ramp against easier year-over-year comps,” Mr. Conrad said.
* National Bank’s Rabi Nizami raised his target for shares of Perpetua Resources Corp. (PPTA-T) to $55 from $50 with an “outperform” rating. The average is $53.68.
“Perpetua Resources announced a significant progress update on U.S. Export-Import Bank (EXIM) loan financing [for development of its Stibnite Gold project in Idaho], filed a Technical Report Summary (TRS) with updated costs, and filed Q4/25 financials. We view these updates positively and expect PPTA to outperform peers heading towards final EXIM board approval and a construction decision this year,” said Mr. Nizami