Inside the Market’s roundup of some of today’s key analyst actions
Rogers Communications Inc.’s (RCI-B-T) low-drama second quarter left analysts making only minor - if any - changes to their price targets and estimates.
Desjardins Securities analyst Jerome Dubreuil called the quarter broadly in line with expectations, even though investors seemed a bit more disappointed, sending shares Wednesday down 4.6%. A concern may have been wireless service revenues slipping back into negative territory.
“Wireless growth improvement moderated, which could extend the deleveraging timeline,” Mr. Dubreuil said in a note to clients. “We nonetheless expect conditions to improve, supported by a disciplined start to the back-to-school season, capex plans that appear better aligned with the industry’s return potential and a sports asset monetization plan that we view as achievable.”
The Desjardins analyst maintained a “hold” rating and C$58 price target.
RBC Capital Markets analyst Drew McReynolds noted that second quarter results were slightly ahead of his expectations and Rogers’ reiteration of its 2026 guidance was encouraging. He reiterated a price target of C$60.
His rating on Rogers is “outperform”, as he thinks the stock is trading at an attractive entry point.
“We continue to see an equity reflation story for Rogers driven by free cash flow generation, outright debt repayment given the relatively low dividend payout ratio (<30% of FCF), and further progress on balance sheet de-levering that now includes the completed $7B structured equity investment and a clear path for crystallizing a minority interest in the sports and media assets,” Mr. McReynolds said.
“We view current levels as another attractive and even more timely buying opportunity particularly should: (i) the operational environment show further improvement into 2027 and 2028; (ii) the sale of a 25%-30% minority interest in the sports and media assets be supportive of management’s estimated >$25B total valuation; (iii) a de-risking of the Rogers story unfolds as leverage declines into the 3.0x-3.5x range; and (iv) visibility on enhanced capital returns (dividend growth, share repurchases) begins to emerge.”
Canaccord Genuity analyst Aravinda Galappatthige slightly trimmed his price target to C$57.50 from C$58 and maintained a “buy” rating.
He said the second quarter results “were very much in line”, with the stability in cable revenues a highlight.
“Following the recently announced agreement to acquire the remaining 25% interest in MLSE (from Kilmer), the focus returns to the prospect of a sizable divestiture (a minority interest) in Rogers SportsCo. Notably, the underlying valuation for the Kilmer deal of $17B for MLSE was higher than $12.5B for the 37.5% stake from BCE. In this backdrop, we see a realistic valuation of $22-23B for Rogers SportsCo combined, which has meaningful implications for valuation,” the Canaccord analyst said.
TD Cowen analyst Vince Valentini raised his price target to C$65 from C$60 and reiterated a “buy” rating. He said Rogers remains TD’s top pick among Canadian telecom names and sees “no sustainable reason’ for Wednesday’s share price decline. ”Notably, given recent events and management commentary, we have more confidence in both free cash flow increasing (via lower capex) and sports being monetized at an attractive valuation in a timely fashion," Mr. Valentini said.
The average analyst price target is C$60.14, according to S&P Capital IQ.
TD Cowen analyst David Kwan downgraded CGI Inc. (GIB-A-T) to “hold” from “buy” and reduced his price target to C$99 from C$102. He notes that CGI stock has been outperforming peer Accenture Plc in recent months, trading at a 15-20% premium on a next 12 months enterprise value to EBITDA basis for the first time in a decade. Historically, it has traded at a 25% discount. All this suggests CGI has some significant headwinds when it comes to valuations.
“While there were some positive readthroughs from Accenture’s disappointing Q3 results/guidance last month, there were many negative data points that helped drive a sharp sell-off across the IT Services space, as it faces continued headwinds from the Iran conflict, a related late-quarter pullback in discretionary spending, and longer sales cycles/reduced visibility,” Mr. Kwan said in a note to clients. “IBM’s negative preliminary Q2 update last week also noted key headwinds including IT spending priorities/focus (e.g., hardware, cybersecurity).”
“Although management expects U.S. Federal to return to organic growth in Q3, we think the rebound could be softer-than-expected, particularly given the prolonged and costly Iran conflict. That said, GIB.a will be facing easier comps given DOGE last year and the U.S. federal shutdown last fall,“ he said.
Mr. Kwan termed AI as “a double-edged sword” for companies such as CGI. “The sector is facing AI-driven pricing and competitive headwinds that is leading to sluggish/negative organic growth. Margins could benefit in the near term, mostly notably from existing MS contracts, but contract (re)pricing risk remains a key concern.”
He lowered his forecasts for CGI, which were already near the bottom for the Street. He does not expect a return to positive organic growth until fiscal 2027 at the earliest, “as we think conditions for a rebound in near-term demand is not present. Amongst other things, customers remain cautious given the macro/geopolitical uncertainty, which has led to continued longer sales cycles.”
The average analyst price target is C$100.83.
Desjardins analyst Kyle Stanley initiated coverage of Northview Residential REIT (NRR-UN-T)with a “hold” rating and C$18 price target.
The REIT owns a portfolio of apartment assets in secondary and tertiary markets, with a significant presence in Northern Canada.
“With a concentration in resource extraction–focused markets and the North, NRR is positioned to benefit from new fiscal stimulus programs over the long term. That said, elevated leverage, limited trading liquidity, and a fair relative valuation keep us on the sidelines," Mr. Stanley said.
He listed several positives that investors may want to consider, especially if the share price allows for a more attractive entry point: “NRR’s elevated 6.5% distribution yield is well-covered; the non-traditional market exposure has been more insulated from population growth deceleration and new supply, while the federal investment cycle in resources and the Arctic offers a longer-term catalyst.”
The average analyst price target is $17.80.
Desjardins analyst Brent Stadler raised his price target on Brookfield Renewable Partners L.P. (BEP-UN-T) to C$49 from C$48 while reiterating a “hold” rating after the company significantly expanded its battery storage capabilities by acquiring Aypa Power for US$3 billion. Aypa Power is the largest standalone battery storage developer in North America.
“We estimate the acquisition was completed at an EV/EBITDA multiple of ~10–12x and should be immediately accretive to our estimated 2027 funds from operations per unit by over 2%,“ Mr. Stadler told his clients.
He estimates the deal bolsters net asset value per share by about 50 cents. “We expect that BEP will look to optimize the commercial strategy and capital structure to accelerate growth and implement an asset recycling program, which could create additional shareholder value,” he said.
The average analyst target is US$32.70.
National Bank analyst Gabriel Dechaine raised his price targets on Canadian insurers ahead of their second quarter earnings that start to be released next week.
His price target for Great-West Lifeco Inc. (GWO-T) went from C$73 to C$93.
For IA Financial Corp. (IAG-T) it from C$179 to C$205.
For Manulife Financial Corp. (MFC-T), it went from C$59 to C$69.
And his target for Sun Life Financial Inc. (SLF-T) went from C$108 to C$125.
But the moves came with words of caution. He warned that the results could give pause to the sector, particularly after lifeco stocks overall rose 27% so far this year, far outpacing the S&P/TSX Composite Index.
“Despite the signal of our target price increases, we do not believe that Q2/26 results will act as a material catalyst for the sector,” Mr. Dechaine said in a note to clients. “Outside the supportive equity market backdrop, there are several company-specific challenges ahead of the quarter, such as 1) a fall-off of experience gains in GWO’s Capital & Risk Solutions segment after an unusually strong Q1/26; 2) lower U.S. auto sales and sales mix putting downward pressure on IAG’s U.S. segment earnings; 3) elevated Group claims, and associated investment spending in claims management, in MFC’s Canadian operation; and 4) SLF’s U.S. segment challenged by seasonal Stop-Loss weakness and the ongoing repositioning of the Dental business. We are not suggesting that Q2/26 results will be ‘doom and gloom’, only that, after the run the stocks have been on, there is little room for upside surprises in our view.”
Nevertheless, he hiked his target prices “to reflect the sector’s valuation re-rating, increasing our equally weighted sector price to book multiple to 2.2x from 2.0x and sector price to earnings multiple to 13.0x from 12.3x. We are also extending our valuation timeline to 2028. As a result, our target prices are increasing by 15%.”
He rates Manulife and Sun Life “outperform”; Great-West and IAG “sector perform”.
Desjardins analyst Frederic Tremblay slashed his price target on Goodfood Market Corp. (FOOD-T) to 5 cents from 15 cents after reviewing the company’s latest quarterly results.
“3Q results reflect mixed early impacts from product enhancements and cost-reduction initiatives. Active customer declines persisted, while adjusted EBITDA improved on significantly lower SG&A [Selling, General, and Administrative expenses] spending. We increased our adjusted EBITDA forecasts to reflect stronger cost discipline, but continue to highlight the company’s March 2027 debenture maturity and associated dilution risk. Given the challenged growth outlook and balance sheet constraints, our risk qualifier remains speculative,” he said.