Inside the Market’s roundup of some of today’s key analyst actions
With North American consumer demand for automobiles remaining “resilient” in the first quarter, TD Cowen analyst Brian Morrison expects few negative surprises during earnings season.
“Our Q1/26E EBITDA/EPS estimates are in line-to-nominally below consensus,” he said. “We believe global production trends are in line with expectations, and that operational excellence/restructuring initiatives should benefit margin performance. We expect MGA/ MRE/LNR to all maintain their 2026 guidance, complemented by active Q1/26 NCIBs for each company.”
Mr. Morrison said production was “modestly” lower year-over-year, leading to U.S. dealer inventories “remaining lean.” He sees that as “a positive setup” for parts suppliers “should we see Middle East conflict resolution, and consumer confidence to be maintained/improve.”
“We made modest operational updates to our financial forecast for our suppliers under coverage,” he added. “Our view remains that stable production should be augmented by operating efficiencies/improved contract economics. Our revision to Magna accounts for its recent divestiture of its Lighting & Rooftop Systems being accounted for as a discontinued operation, and another recent acquisition by Linamar, utilizing the strength of its balance sheet to take advantage of takeover opportunities.”
“Potential Catalysts: For the group - conflict resolution, consumer affordability maintaining consumer resiliency, forecast 2027 year-over-year production increase.”
Seeing “consumer resiliency, potential conflict resolution, USMCA clarity, and positive year-over-year financial performance” providing potential catalysts “supporting improved investor confidence/applied valuations,” Mr. Morrison made one target adjustment, raising Linamar Corp. (LNR-T) to $116 from $114, remaining a high on the Street, with a “buy” rating (unchanged). The average is $104.25.
“We are positive on the outlook for Linamar, largely due to the forecast growth within its Mobility segment from recent acquisitions, organic CPV growth, and anticipated margin expansion,” said Mr. Morrison. “We remain cautious with respect to the near-term Industrial outlook but view 2026 as the potential trough prior to benefiting from the cycle improving in 2027. A strong FCF profile and financial position are supportive of additional M&A opportunities, and commitment to its NCIB. This could result in upward revisions to our financial forecast, that along with an uptick in the Industrial cycle, should improve its valuation.”
His other targets are:
* Magna International Inc. (MGA-N/MG-T, “buy”) at US$75. Average: US$66.46.
Analyst: “While Magna does not represent the most upside to our supplier target prices, it remains our top pick currently due to the uncertain macro environment/trading liquidity relative to the group. We forecast in a flat production environment that Magna can drive margin/FCF improvement through operating efficiencies/improving contract economics. This, along with strong FCF/financial position, supports its active NCIB. Upon visibility that the consumer can remain resilient, this should support improvement to its below-average valuation.”
* Martinrea International Inc. (MRE-T, “buy”) at $15 (Street-high). Average: $12.67.
Analyst: “While the Q1/26 results may not prove a catalyst event, we see tremendous value at the current share price AND opportunities to potentially surface value to a degree during the remainder of the year. This includes non-core asset monetization, an ongoing NCIB, new business wins from nearshoring, strong FCF, and meeting/exceeding financial guidance.”
Restaurant Brands International Inc. (QSR-N, QSR-T) possesses “solid underlying momentum with room for further upside” ahead of the release of its first-quarter results on May 6, according to RBC Capital Markets analyst Logan Reich.
“We think QSR’s positive momentum continued through Q1 where Burger King and international segments have been the standouts recently,” he said. “BK U.S. has further room for improvement, in our view, given ongoing renovations, menu innovation, and more impactful marketing targeted towards key demos. International strength has been broad-based across key BK markets where consensus expectations appear relatively conservative. Tim Hortons could start to be impacted by slower Canadian population growth, though continues to outperform the category. Despite recent outperformance, we think the stock has further room for upside where the multiple is still a high-teens discount vs. mature global quick-service peers.”
Mr. Reich is now projecting a financial beat for Restaurant Brands, touting a “positive” risk-reward proposition for its shares as well as encouraging investor sentiment.
“Burger King continues to gain momentum as renovations drive upside with room for further improvement given only 58 per cent of stores were at modern image at the end of 4Q25,” he noted. “And while elevated beef prices are slowing the pace of renovations, we think the brand is approaching critical mass of Modern Image locations which is driving a positive halo effect on the entire brand’s consumer proposition. Combined with menu innovation (improved Whopper + social media buzz certainly doesn’t hurt) and updated marketing strategy (targeting kids & families), we see room for upside to SSS [same-store sales] estimates in Q1 (Street at 2.7 per cent) and FY26 (Street at 2.3 per cent).
“Tim Hortons missed SSS in 4Q, where heading into ’26, Canadian macro could be more of a headwind year-over-year. As we previously wrote, Canadian population is expected to be flat year-over-year in ’26 (from 0.9 per cent in ’25 and 3.0 per cent in ’24), which could limit upside to Street’s 2.6-per-cent/2.5-per-cent Q1/FY26 estimates (though 2H comps could benefit from Canadian Tire partnership). For Q1, the focus remains on performance relative to broader Canadian quickservice market, specifically on food, cold beverages, and PM daypart.”
Reaffirming his “outperform” rating for the Toronto-based company’s shares, Mr. Reich raised his target to US$90, equally the high on the Street, from US$83, citing “higher confidence in top-line growth.” The average is US$80.47.
“We continue to view QSR as a top idea among the global franchised fast food group,” he said. “We see potentially improving Burger King U.S. trends, accelerating development, and shifts in capital allocation (toward growth investments and reduction in leverage) driving stock performance. Relative valuation for QSR remains compelling (15 times 2027E P/E versus global peer average of 18 times), in our view, particularly as we are taking a more cautious stance on the overall group.”
National Bank Financial analyst Baltej Sidhu thinks 5N Plus Inc. (VNP-T) is poised to benefit from a re-rating in the defence supply chain.
In a client note released before the bell titled Magnifying the Re-Rating; Duration, Scarcity & Strategic Relevance, he argues a tense geopolitical environment has helped establish the strategic importance of the Montreal-based producer of specialty semiconductors and performance materials, and he sees growth continuing with “defence demanding accelerating, supporting upside.”
“The broader valuation backdrop has become more supportive for VNP, with defence comps forward EV/EBITDA on 2027E re-rating from 15.2 times at year-end 2025 to 18.0 times currently while VNP moved from 12.5 times to 18.2 times,” he explained. “The multiple expansion has been supported by improving demand visibility and capacity expansion across the sector. Recent developments in the Iran conflict highlight structural supply constraints, with precision-guided missile systems produced at relatively low volumes (600–1,000 annually) and requiring 1–2 years to replenish, underscoring the need for sustained investment. Of note, germanium is an important input in many modern precision-guided munitions, particularly those using thermal targeting and infrared (IR) seeker systems, reinforcing VNP’s relevance within this supply chain.
“In response, U.S. defence spending is accelerating, with $24.7-billion already allocated toward munitions expansion and a potential $20–50-billion supplemental under consideration, alongside plans to increase production of critical weapons by 2–4x. This should drive investment across the defence supply chain, from missile primes (i.e., Lockheed and RTX) to propulsion and subsystem suppliers, including solid-rocket motor suppliers (Northrop and L3Harris) and critical components like seekers (Boeing and BAE Systems). Major defence contractors and key suppliers are expected to boost capex (approximately 3.5 per cent of sales, up 120 basis points year-over-year) to expand capacity, with demand flowing through to subsystem and component providers across propulsion, sensing, and electronics. We believe VNP is seeing increased engagement from major U.S. defence contractors, supporting its positioning within this ecosystem.
Mr. Sidhu maintained his first-quarter forecast for 5N Plus, which currently tops the Street’s expectations for revenue and adjusted EBITDA by almost 10 per cent ($111.4-million and $24.9-million, respectively, versus $102.4-million and $22.1-million). He emphasized investors “could see it print its ninth consecutive beat.”
“Amid geopolitical volatility, supply chain security and domestic sourcing of critical materials are driving VNP’s 100-per-cent year-to-date rally,” he added. “The company has no direct exposure to disruptions tied to the Strait of Hormuz, while customer priorities are shifting from price competitiveness (vs. China) to reliability of supply; structurally favouring VNP. This shift is reflected in procurement decisions, with First Solar set to transition its CdSe supply to VNP (from a fully China-based supplier) starting H2/26E.
“Rising defence demand is also contributing to VNP’s recent share strength, with suggested customer engagement materially up over the past six months and accelerating more recently. Momentum is strongest in the U.S., where major defence contractors are actively evaluating VNP’s capacity, delivery timelines, and capabilities across germanium, detectors, and optics. We expect AZUR’s strong growth to continue, supported by backlog-driven capacity expansions (25-per-cent additional capacity underway), with geopolitical tailwinds reinforcing demand, underpinning further backlog growth and incremental expansion.”
Also touting “strong visibility and steady execution,” Mr. Sidhu raised his target for 5N Plus shares to $38, matching the high on the Street from $33, keeping an “outperform” rating. The average is $33.50.
“Operational momentum remains strong, driven by space solar demand across commercial, defence, and satellite constellations, supported by a highly active pipeline,” he said. “Visibility is robust, with 2026 fully sold out, 2027 largely contracted, and backlog extending into 2030. AZUR’s capacity expansion is advancing, with new reactor installations aligned to contracted demand. Growth remains volume-driven, with pricing sustained at elevated levels amid tight supply-demand dynamics. Energy exposure is manageable, with limited impact from recent volatility and partial pass-through mechanisms in place.”
Superior Plus Corp.’s (SPB-T) announcement of a $300-million, 2.5-year data centre power contract for its wholly owned subsidiary Certarus Ltd. is “a clear positive,” according to TD Cowen analyst Aaron MacNeil, seeing it come “at a time when energy demand [is] positioned for positive inflection.”
“Given the ongoing Iran war and increase in crude oil prices, Certarus was already well positioned for a recovery in the business,” he said. “This growth vertical outside of its core upstream oil and gas market will likely further support a strengthening outlook for this business.
“At steady state, the project is expected to require 200 CNG transport trailers and ancillary equipment. Some portion of the required trailers could be sourced from the existing fleet. However, given current high utilization and the scale of the project, incremental trailers and associated capital are likely in our view. This likely pushes out management’s debt reduction target beyond the end of 2027 given the timing of spend and the ramp in cash flows, although it does represent a meaningful growth avenue which will naturally result in a lower leverage ratio on a forward-looking basis.”
While noting key data points around margin and return expectations as well as capital commitments are not expected to be revealed until the release of first-quarter disclosures on May 13, Mr. MacNeil said “potential investors must believe these opportunities will persist in the future given a large contract cliff.
“While our estimates do not extend out to 2030, this contract embeds longer-term risk to the business given its size,” he added. “To the extent that these data center opportunities do not reoccur in the future, this market could be at risk of becoming materially oversupplied.”
“At least initially, we’ve assumed $150-million of capital distributed evenly over the next six quarters, and a $48-million/year step up in consolidated EBITDA beginning in Q3/27. As noted above, we expect management to provide a more detailed update with Q1/26 results on May 13, 2026.”
Maintaining his “hold” recommendation for Superior Plus shares, Mr. MacNeil bumped his target to $7.50 from $7. The average is
“With three consecutive quarters featuring material negative surprises, as well as two consecutive years of annual guidance misses, we believe that Superior Plus is in ‘show me’ territory,” he concluded. “We view this contract as positive, but would like to see several consecutive quarters of meeting expectations before we get more constructive on this name. As a result, we are maintaining our HOLD rating.”
Precious metals equity analysts at TD Cowen expect a “strong” first quarter for the sector, seeing all-in sustaining cost margins “reaching record highs driven by the gold price, despite weaker Q1 seasonality.”
“We remain constructive on precious metals, supported by the ongoing dedollarization trade, persistent inflation, and easing rates,” they added. “We have made only minor changes to our deck, upping 2026 prices slightly.”
In a research report released before the bell, the analysts think the appreciation in the price of gold should “drive record margins, despite energy cost pressures.” They now see prices “stabilizing amid geopolitical tensions” but emphasize the outlook “remains strong.”
“Despite Q1 generally being the seasonally weakest quarter for producers, we are expecting a strong Q1 driven by record gold prices,” they said. “While recent increases in energy costs are likely to start causing cost pressures, we expect most of the impact to start being felt in Q2, and should be offset by higher metal prices. We forecast AISC margins expanding 17 per cent quarter-over-quarter to $2,974/oz, with sector FCF of $6.5-billion lower due to slow seasonal tax and profit sharing payments. We expect further capital return increases (buybacks and dividends).
“Q1 saw another record-high average price of $4,875/oz, up 17 per cent from Q4’s $4,153 average. While the war in Iran, along with higher inflation expectations, a stronger USD, and elevated yields have caused some short-term weakness in gold, we view the resulting price pressure as transitory. Looking ahead, the focus is shifting to the conflict’s economic impact, with rising stagflation risks historically supportive for gold. Continued geopolitical uncertainty, central bank demand, and a supportive rate backdrop should underpin gold strength later in 2026. We have made only minor changes to our deck, increasing 2026 prices slightly.”
With that adjustment, the analysts made several target price changes to stocks in their coverage universe. For senior and intermediate producers, their changes are:
- Agnico Eagle Mines Ltd. (AEM-N/AEM-T, “buy”) to US$252 from US$251. The average is US$260.32.
- Alamos Gold Inc. (AGI-T, “buy”) to US$78 from US$70. Average: US$58.78.
- Endeavour Mining PLC (EDV-T, “buy”) to $105 from $94. Average: $102.48.
- Newmont Corp. (NEM-N, “hold”) to US$116 from US$118. Average: US$154.10.
- OceanaGold Corp. (OGC-T, “buy”) to $56 from $55. Average: $67.50.
"Our top picks include Agnico Eagle, Barrick, IAMGOLD, K92, and Equinox. Among the royalties our top pick is Royal Gold, and Coeur among the silvers," they said.
Ahead of earnings season in Canada’s energy sector, Scotia Capital analyst Kevin Fisk named Cenovus Energy Inc. (CVE-T) as his top large-cap stock, expecting its free cash flow to “increase meaningfully as growth spending declines and production increases.”
“Additionally, higher commodity prices accelerate CVE’s debt repayment and at $75 WTI the company could achieve its $6-billion net debt target by year-end 2026 (although a dividend increase or working capital build could delay this by a quarter),” he said. “Achieving the $6-billion net debt target would increase shareholder returns from 50 per cent to 75 per cent of FCF after dividends. We also like CNQ and believe the current share price offers a good entry point and the company’s underperformance year-to-date has been overdone. CNQ also has the most exposure to elevated SCO prices. We have a Sector Perform rating on SU, but view it as a good option for investors looking for a resilient business in a volatile commodity market.
“WCP and OVV are our top Mid-cap picks. WCP is a solid operator with a number of upcoming operational catalysts including the ramp-up of the Lator facility in Q4/26 (35-40 mboe/d), plug-and-perf wells will be piloted at Gold Creek/Karr and have the potential to reduce well costs by $1-million-$1.5-million per well, and the realization of the additional Veren Inc. synergies that have been identified. OVV is also a strong operator and we believe its Midland assets hold underappreciated value. On strip, WCP and OVV have attractive 2027 DAFCF yields of 10 per cent and 14 per cent vs peers at 6-10 per cent. We also want to highlight TPZ as our top royalty pick.”
Mr. Fisk maintained his “sector outperform” rating and $38 target for Cenovus. The average on the Street is $40.30.
He also made several target price changes in his coverage universe on Tuesday. For large-cap stocks, his lone change was Suncor Energy Inc. (SU-T, “sector perform”) to $90 from $85. The average is $93.54.
In other analyst actions:
* With its deal to be acquired by Agnico Eagle Mines Ltd. for up to $2.9-billion in stock and cash, ATB Cormark’s Stefan Ioannou moved Rupert Resources Ltd. (RUP-T) to “tender” from “outperform” and cut his target to $15 from $22. The average is $12.
“Bottom line, we view the offer as fair, also noting the proposed transaction is accompanied by offers from Agnico to acquire other key third-party properties in the area—importantly consolidating a property position in support of optimized/timely Ikkari development, which previously arguably hindered Rupert’s market valuation,“ said Mr. Ioannou. “Furthermore, the company’s shareholders maintain exposure to the greater project—now ‘enhanced’ via Agnico’s seasoned ‘operatorship’ in Finland (neighbouring Kittilä gold mine). As such, we are revising our formal recommendation to Tender (from Outperform) and our target price to $15.00 per share as per the transaction’s implied metrics at the time of announcement (in part reflecting our continued view that Rupert’s CLGB position stands to bear additional fruit over time). Although said new target has been decreased from $22.00 per share, we look to the proposed transaction favourably, cognizant our previous model arguably required relatively heightened investor patience and risk-tolerance associated with a ‘Rupert-build’ over time—the proverbial ‘a bird in hand is worth two in the bush’ comes to mind. The key risk to our valuation is Agnico transaction completion (expected in early Q3/26).”
* In response to last week’s announcement it has entered into an arrangement agreement to combine with entities owning a 92-per-cent interest in Sweetwater Royalties from funds managed by Orion Resource Partners LP and the Ontario Teachers’ Pension Plan, Raymond James’ Brian MacArthur upgraded Uranium Royalty Corp. (URC-T) to “outperform” from “market perform” with a $6.25 target, up from $5.75 and above the $6.14 average on the Street.
“We believe royalty companies like URC offer equity investors diversified exposure to commodity prices, while mitigating downside risk given limited exposure to operating and capital costs. At the same time, upside optionality exists through exploration and asset expansion potential. URC’s royalty portfolio is focused on uranium assets with lower jurisdictional risk, longer duration, and backed by some strong operators. Given URC’s high-margin business model, its diversification, optionality, favourable jurisdictional risk, and strong balance sheet, we believe URC offers investors a good way to get lower-risk exposure to uranium,” said Mr. MacArthur.
* In a report previewing quarterly earnings for IT Services providers, Desjardins Securities’ Jerome Dubreuil lowered his CGI Inc. (GIB.A-T) target to $149 from $157 to reflect lower growth expectations for fiscal 2026. The average is $149.88.
“Over the past several weeks, we have not observed any meaningful change in the IT services demand environment, based on our review of peer results and recent management commentary. While this is reassuring amid disruption fears, management teams at global peers have struggled to articulate the long-term net impact of AI on the industry. Recent commentary has lacked quantification and has often been too general to provide investors with strong conviction. We look forward to hearing more concrete examples from CGI and Alithya on their respective calls,” he said.
* Ahead of the release of its first-quarter results after the bell on May 7, Desjardins Securities’ Gary Go raised his Dominion Lending Centres Inc. (DLCG-T) target to $11.50, matching the average, from $11.25 with a “buy” rating.
“Against a slow start to the housing market and economic uncertainty sidelining potential buyers, CREA has downgraded its sales forecasts for 2026 and 2027. We reiterate our 1Q26 estimated FMV [fair market value] growth of 3.0 per cent year-over-year and EBITDA of $8.7-million (up 9 per cent year-over-year), noting tough year-over-year comps and winter storm impacts, with FMV growth improving through the rest of 2026,” said Mr. Ho.