Inside the Market’s roundup of some of today’s key analyst actions
RBC Dominion Securities analyst James McGarragle sees an “improved steel price outlook as well as reflecting improving demand fundamentals” that he expects to benefit results at Russel Metals Inc. (RUS-T).
“We are increasing our steel price estimates to reflect strong pricing trends, which we expect to persist given an improving demand outlook as both Canadian and U.S. PMI readings remain above 50,” he said. “We note that while U.S. PMI has maintained strong momentum, Canadian readings have also benefited from defence industrial spending and Buy Canadian policies, which we see as a positive for domestic industrial demand. However, we highlight the ABI is trending below 50 and fell to 44.5 in May.
“Furthermore, the Canada-U.S. steel price gap remains wide, with domestic sheet prices still at a meaningful discount to U.S. levels as tariffs continue to suppress realized Canadian pricing and excess sheet supply persists. We expect index prices to trend at current levels into Q3 and then to $1,050/st into 2027.”
In a client report released before the bell on Tuesday previewing second-quarter results in the industry, Mr. McGarragle emphasized a divergence in fortunes between Toronto-based Russel and peer Algoma Steel Group Inc. (ASTL-T).
“Algoma’s shares were roughly flat in Q2, up 1 per cent, trailing the steel producer group average of 19 per cent, in our view reflecting continued uncertainty related to steel tariffs,” he explained. “Russel shares traded up 24 per cent in Q2, outperforming U.S. distributor peers WS and RYI which were roughly flat, reflecting a partial closing of Russel’s valuation gap vs. Reliance, deserved in our view, driven by strong execution and opportunistic capital allocation over recent quarters.
“The share price strength was also likely supported by positive management commentary on the demand environment at our conference, improving PMI readings, and a stabilizing LTL [less-than-truckload] freight backdrop, all of which point to better industrial activity and distributor volumes in Q2 and heading into Q3.”
Mr. McGarragle thinks the key focus of investors heading into earnings season remains the outlook for steel pricing and “whether recent pricing strength is sustainable (we believe it is) as well as if demand momentum persists during the rest of the year (we believe it will).”
While he raised his forecast for Algoma, he maintained his “sector perform” rating and $7 target. The average target on the Street is $8.52, according to LSEG data.
“Our Q2 EBITDA estimate moves to a loss of $67-million (from a loss of $87-million), roughly in line with consensus of a loss of $64-million, on the back of higher steel prices,” he explained. “However, we note that Canadian steel prices continue to trade at a significant discount to the U.S. benchmark, and we therefore see a high degree of uncertainty related to our updated estimates. Our 2026 EBITDA estimate increases to a loss of $158-million (from a loss of $198-million), in line with consensus a loss of $160-million. This reflects higher steel price assumptions for 2026. We continue to expect Algoma to achieve breakeven EBITDA by year-end and model for $209-million of EBITDA in 2027 (from $201MM), ahead of consensus $176-million, aided by a narrower Canadian steel price discount and lower expected tariff rates.”
For Russel, he maintained his outlook for the quarter but moved his price target for its shares higher to $68 from $63 with an “outperform” rating. The average is $60.
“Our Q2 EPS estimate remains at $1.07, in line with consensus of $1.07,” he said. “That said, our EPS estimate reflects a meaningful performance in the quarter, which we do not believe is factored into consensus numbers; and we therefore view our estimate as representing significant upside versus what is being built into street estimates. Our 2026 EPS estimate also increases to $3.85 (from $3.76), ahead of consensus $3.81, driven by an improving industrial outlook that we see Russel as well positioned to capitalize on.”
Following recent institutional meetings with RB Global Inc.’s (RBA-N, RBA-T) management and “supplementary industry/data checks that further strengthen [his] investment thesis,” Raymond James analyst Steve Hansen upgraded its shares to a “strong buy” recommendation from “outperform” previously.
“In short, we believe RBA will continue to benefit from a series of positive vectors including: 1) sustained market share gains at IAA, including a healthy volume re-acceleration in 2Q26; 2) improving macro signals in CC&T; 3) a strong pipeline of strategic growth opportunity, both organic and M&A; and 4) a shareholder-friendly capital allocation framework that now includes active share repurchases,” he said.
Mr. Hansen’s bullish stance centres on a forecast for a re-acceleration in auto volumes in the second quarter, while he notes the company’s commentary aligns with his view of “strong gains being observed.”
“Management expects salvage volumes to re-accelerate in 2Q26 following a slowdown in 1Q26 (up 0.9 per cent year-over-year) that was largely attributed to: 1) the pull-forward of certain auctions into 4Q25; and 2) severe January weather that impacted planned auction activity,” he added. “Further supporting this outlook are recent contract renewals with IAA’s two largest customers — both of which reportedly boosted volume commitments. As we highlight below, Auto volumes have accelerated very nicely since these recent contract renewals.”
“Path To 50/50 on Track, More ‘Shots on Net’ in 2H26 & 2027. Management remains confident that IAA will continue to recapture market share from its largest competitor with the pathway back to 50/50 still the long-term target. Recent contract renewals reinforce this view, with management now estimating IAA’s market share in the ‘high-30s’ (‘approaching 40 per cent’) vs. ‘low-30s’ at the time of the acquisition. With RBA facing no major customer renewals over the next 2+ years, management reiterated it expects to capitalize on more ‘shots on net’ vs. its largest competitor that reportedly faces “multiple” contract renewals over the same period.”
Mr. Hansen kept a target of US$145 per share. The current average is US$126.
Raymond James’ Sean Jack initiated coverage of Hammond Power Solutions Inc. (HPS.A-T) with an “outperform” rating, seeing it “uniquely positioned to deliver outsized growth through our forecast horizon, supported by its leadership in the North American dry-type transformers market, deep customization expertise, diversified manufacturing footprint, and exposure to powerful secular tailwinds.”
“Investment in AI infrastructure, data centres, electrification, renewable energy, and grid modernization is driving unprecedented demand for transformers and power quality equipment. With industry manufacturing capacity still constrained, we believe HPS is well-positioned to capitalize on a multi-year infrastructure investment cycle,” he added.“
“Complex projects play directly into HPS’s strengths. Electrification, AI infrastructure, renewable power, and grid modernization are driving increasingly complex electrical projects that require customized solutions. Backed by decades of engineering expertise and a proprietary database containing more than one million transformer designs, we believe HPS is exceptionally well-positioned to win higher-value projects where reliability and customization matter most.”
In a client report titled Built for the Power Supercycle, Mr. Jack said the Guelph, Ont.-based company’s diversified manufacturing footprint is “a competitive advantage” as it transitions into “more than a transformer company.”
“HPS is North America’s largest dry-type transformer manufacturer, with facilities across Canada, the U.S., and Mexico,” he said. “While tariffs have created uncertainty across the electrical equipment supply chain, we believe HPS’s diversified footprint balances low-cost production with local market access, supporting both profitability and customer responsiveness.
“The pending acquisition of AEG Power Solutions expands HPS’s reach into adjacent mission-critical markets, including power quality, uninterruptible power supply, power conversion, and aftermarket services. We believe the transaction broadens the company’s addressable market and marks another step toward becoming a more diversified electrical equipment platform.”
Seeing “impressive growth ahead,” Mr. Jack set a target for Hammond shares of $405. The average on the Street is $360.60.
“Supported by differentiated engineering expertise, a strategic manufacturing footprint, and generational demand tailwinds across multiple end markets, we forecast revenue and adj. EBITDA CAGRs of 27 per cent and 34 per cent, respectively, between 2025-2028,” he said. “While our forecasts exclude additional acquisitions, we expect strong FCF generation will provide ample flexibility to pursue further M&A.”
Elsewhere, Acumen Capital’s Jim Byrne raised his target to $365 from $345, keeping a “buy” rating, following the close of its $365-million acquisition of AEG Power Solutions on Monday.
“We believe the company is still in the early stages of growth in revenue driven by the massive investment in data centres to be deployed over the next several years. The company’s share price valuation has been re-rated higher as they continue to execute on their strategy and take advantage of the electrification and data centre tailwinds. AEG broadens the company’s geographic reach and product portfolio further,” said Mr. Byrne.
National Bank Financial analyst Vishal Shreedhar predicts Metro Inc.’s (MRU-T) ongoing strike at its Laval, Que., fresh produce distribution centre will have a “meaningful and largely transitory impact” on its third-quarter financial results.
“Metro provided an update to the ongoing strike in Quebec on June 25, 2026, which we understand is yet to conclude negotiations,” he said. “While an extended period of strike may result in further financial impact, our view is that it will ultimately prove to be largely transitory, and hence our F2027+ estimates are primarily unchanged.”
Mr. Shreedhar is now projecting earnings per share of $1.25 for the quarter, falling in line with the mid point of the Montreal-based grocer’s guidance, but down from $1.52 a year ago. He attributes that 17-per-cent decline largely to the impact from the strike in Quebec, which began on March 30.
“We estimate that the magnitude of disruption, on average, on a per-week basis (approximately $4.8-million) is slightly higher than the Terrebonne freezer outage ($4.4-million; September 12, 2025, until November 10, 2025) so far,” he added.
At the same time, the analyst thinks food inflation is likely to benefit underlying same-store sales growth results.
“In the core food business (apart from fresh in Quebec), we expect continued benefit from higher year-over-year food store inflation and discount banners attracting more customers (sssg outpacing conventional),” he explained. “Specifically, Statistics Canada data (until May 2026) suggests food store inflation was 4.0 per cent vs. 4.3 per cent last quarter and 3.1 per cent last year.
“Our review of peer/management commentary suggests a continuation of prior themes including: (i) Largely consistent consumer behaviour, (ii) Grocer internal inflation that is below Statistics Canada CPI, and (iii) Continued rational competition, while square footage growth accelerates.”
Mr. Shreedhar maintained his “sector perform” rating and $105 target for Metro shares. The average is $102.17.
“We believe MRU is a solid company which has delivered solid long-term returns over various economic cycles. However, our coverage presents investments which offer a better comparative investment proposition,” he said.
In response to a recent pullback in share price, Scotia’s Ben Isaacson upgraded Nutrien Ltd. (NTR-N, NTR-T) to “sector outperform” from “sector perform” previously, recommending investors take an “overweight” stance on fertilizer companies.
“The ferts, as crops, fertilizers, and the equities are all bottoming at the same time,” he said. “First, on the macro, we see upside price risk to grain/oilseeds markets mid-term, largely on reduced planted acreage, yield risk on insufficient N+P [nitrogen-phosphorus] application, severe drought risk this summer, and now a Super El Niño on the way. Consider new crop corn at $4.30/bu vs. production costs 10 per cent to 15 per cent higher. Second, on the ferts, urea has overshot to the downside, ammonia remains demand-driven, for now, phosphorus margins should recover on costs falling faster than prices (a temporary phosphorus CVD suspension is irrelevant near-term), and potassium remains stable, though could soften a touch into ‘27. Third, most of the equities are down 25 per cent to 30 per cent recently, as investors exited/shorted on the Iran war unwind + the seasonal withdrawal of NPK demand.
“Finally, and as we see the crops, the ferts, and the stocks all bottoming, we recommend value-seeking contrarians overweight the ferts, especially as over-earnings and Hormuz risks are now joined at the hip
Mr. Isaacson kept an US$80 price target for Nutrien shares. The average is US$81.
He explained: “Bull Points: (1) it’s unclear to us why NTR has pulled back so meaningfully on both an absolute basis and relative to CF; (2) we see less risk-adjusted global N supply availability than before the Iran war, with a higher probability of over-earnings scenarios - we don’t think this is priced into the stock anymore; (3) the capital allocation story (i.e., narrative + execution) has been very well received by investors - we don’t think this is priced into the stock anymore; (4) crop prices have asymmetric price risk to the upside, while potash remains stable.
“Bear Points: (1) farmers are clearly challenged, although this hasn’t shaken NTR’s ‘26 Retail guide to date; and (2) there is risk the K market softens as farmers catch-up on P over the coming quarters.”
In other analyst actions:
* BMO’s Rene Cartier initiated coverage of Vancouver-based developer Koryx Copper SA (KRY-X) with an “outperform” rating and $6 price target, exceeding the $5.25 average.
“Koryx is backed by an experienced management team with a track record of successful exits and is rapidly advancing the large-scale, long-life, 100-per-cent-owned Haib copper-molybdenum-gold project in Namibia. Following a recently updated resource, Koryx is set to release a prefeasibility study on Haib by the end of 2026 and is targeting to have an environmentally approved project in 2027,” he said.
* Canaccord Genuity’s Kenric Tyghe reduced his target for shares of Aurora Cannabis Inc. (ACB-T) to $5 from $6.50, which is the average on the Street, with a “buy” rating.
“Aurora remains BUY rated with a new price target ... on detailed parsing of recent peer (Canadian and U.S.) commentary and management guidance, which we believe necessitates material negative revisions to our estimates,” said Mr. Tyghe. “While we took what we believed was an axe to our F2027 estimates following the Q4/F26 call, the cuts to our numbers failed to adequately capture the magnitude of the margin pressures through the company’s F2027 reset. The recent peer reports, dovetailing with a heightened probability of U.S. export on recent (and accelerating) regulatory reforms and Aurora’s weak absolute and relative guidance, highlight unexpected sensitivities and weaknesses in Aurora’s positioning. These sensitivities include (1) competitive intensity in Europe that is ramping faster than we previously modelled – across the peer group we saw improving flower quality, supply-chain optimization, and strong international growth, (2) the increased cost to compete is structural rather than transitional. Peers reporting strong international growth did so while absorbing both gross-margin drag and higher pay-to-play spend for weaker EBITDA margins, and (3) Aurora’s Canadian medical business appears to have limited levers to pull in the short- and medium-term to mitigate the material headwind on the Veteran Affairs Canada (VAC) reimbursement rate cut.”
* Stifel’s Justin Keywood raised his DRI Healthcare Trust (DHT.UN-T) target by $1 to $24, exceeding the average of $21.33, with a “buy” rating, while Canaccord Genuity’s Tania Armstrong-Whitworth moved her target to $23 from $22.25 with a “buy” rating.
“DRI’s royalty partner Viridian Therapeutics received FDA approval for TED (Thyroid Eye Disease) candidate, veligrotug, trademark Lumvoa with a broad label, including an indication for both chronic and active TED. DRI first royalty tranche includes 7.5 per cent on sales up to US$600-million or US$45-million in EBITDA to DRI (25 per cent of the run-rate today). The approval triggers a US$75-million regulatory milestone payment by DRI to Viridian and could be funded by an expected exercise of a US$180-million put option from Chiesi’s acquisition of KalVista. The FDA approval also further validates DRI’s pre-approval royalty investment strategy and provides greater visibility into forecasts, where DRI deal activity is expected to resume H2/26,” said Mr. Keywood.
* In a second-quarter earnings preview for freight transportation companies, CIBC’s Kevin Chiang raised his Mullen Group Ltd. (MTL-T) target to $22 from $20 with a “neutral” rating and his target for TFI International Inc. (TFII-N, TFII-T) to US$172 from US$162 with an “outperformer” rating. The averages are $21.67 and US$153.22, respectively.
“As we exit Q2/26, we continue to observe strong seasonal outperformance in both spot TL rates and load-to-truck ratios, with Q2/26 spot TL data once again outperforming seasonal trends. We are also seeing upward movement in contract rates. While supply-driven constraints have been the primary driver of this move up in freight rates, we are beginning to see early signs that demand trends are improving. We expect a more positive tone this earnings season regarding the health of the freight cycle. With the view that we are moving past the Iran War and fuel prices are returning to pre-conflict levels, we believe that this is a more supportive environment for the consumer,” he said.
* ATB Cormark’s Nicholas Boycuk raised his Neo Performance Materials Inc. (NEO-T) target to $43, exceeding the $41.50 average, from $37.50 with an “outperform” rating.
“NEO continues to walk the path it knows and can deliver upon. We’re highlighting the recent equity financing (ATB Cormark Capital Markets participated in the raise), some industry M&A activity (which appears to be on a different path than NEO), and hafnium pricing that likely impacts near-term quarterly results in this note. While the stock has appreciated since the equity raise, we think there’s more to come,” said Mr. Boychuk.
* Raymond James’ lowered his Newmont Corp. (NEM-N, NGT-T) target to US$137 from US$139 with an “outperform” rating. The average is US$143.78.
“Given quarter-end, we have are updating our forecasts for quarter-to-date prices,” he said. “We expect higher gold production in 2Q but also note costs will be impacted by higher oil prices and a full quarter of higher royalties in Ghana. Furthermore, we expect lower by product credits this quarter, especially from silver where we expect lower realized prices and lower production, although there could be some offset on the copper side from provisional pricing. We also expect there could be a negative mark to market on the realized gold price. Furthermore, FCF for the quarter could be impacted by higher sustaining capex as well as higher cash tax payments. Given all these factors we also expect share buybacks under the capital allocation framework to be lower than 1Q. As a reminder, under the new capital allocation framework CF will be used first to pay sustaining capex, then a $1.1-billion dividend, then development capex, then target a net cash balance of $1.0-billion (+/- $2.0-billion) and then use the remainder of CF will be used for share repurchases. We have updated our forecasts.”
* Scotia’s Mario Saric raised his Primaris REIT (PMZ.UN-T) target to $22 from $19.75 with a “sector perform” rating, while TD Cowen’s Sam Damiani increased his target to $24 from $22 with a “buy” rating. The average is $22.25.
“PMZ’s leasing update provided clear visibility on peer-leading, mid-single-digit SPNOI growth through at least 2028, which should see further confirmation when mgmt next updates its outlook. Together with new excess land monetization plans, this supports the recent recovery in relative valuation and maintains PMZ as one of our preferred names among Retail REITs,” said Mr. Damiani.