Inside the Market’s roundup of some of today’s key analyst actions
Following its post-earnings selloff, Citi analyst Ariel Rosa thinks shares of TFI International Inc. (TFII-N, TFII-T) are looking “cheap,” seeing “upside on macro inflection” and pointing to free cash flow of US$750-$800 million at cycle trough against a market cap of just US$7.6-billion.
However, he warned of “ample execution risk” in the turnaround of its TForce U.S. less-than-truckload operations.
“Last week TFI reported one of the more disappointing quarters in recent memory, with EPS down 30 per cent year-over-year and a U.S. LTL adj. operating margin of just 2.7 per cent, a 630 basis points deterioration year-over-year,” said Mr. Rosa. “The stock is down nearly 30 per cent since reporting, reflecting the depth of investor fear that something is structurally broken at TFI, particularly its TForce Freight division which it acquired from UPS in 2021 and has been a persistent challenge ever since. Even with the decline of the past week, however, TFI stock has compounded at 15-per-cent and 21-per-cent annualized rates over the past 5- and 10-year periods, respectively, leading us to view CEO Alain Bedard as a smart operator and skilled acquirer.”
“TFI CEO Alain Bedard offered his most prescient quote when he noted on the company’s earnings call, “If you wait for things to get better, you’re going to have to pay more”. While Mr. Bedard was speaking about the company’s M&A strategy, he might as well have been speaking directly to investors about TFI’s share price. TFI has shown itself to be a savvy acquirer and a capable operator over time, with several of its businesses executing at very high levels, including its Canadian LTL business which is near best-in-class. The issue has been, and continues to be, its US LTL operations, which by TFI’s own admission, have been “a disaster”. The company inherited many problems, which in our view, were partially masked by the strong freight market during the height of the pandemic. Now that transports have been in a prolonged freight recession, TFI’s TForce Freight division is arguably experiencing this downturn in a more pronounced manner than any other LTL carrier. While we do not intend to be naïve about the scale of the challenges at TFI, we also believe that Mr. Bedard has shown himself capable of identifying issues and fixing them over time. We are sympathetic to investor concerns – and we fully recognize the extent to which TFI has execution risk, structural issues, and risk from competition, including Amazon’s potential encroachment into LTL – we also believe there is sufficient room for improvement that we expect significant earnings upside when conditions inflect.”
In a research note released Tuesday, the analyst summarized a fireside chat with CFO David Saperstein at Citi’s Industrials conference, which came after the TFI’s quarterly release. He said the company provided several reasons for both its “challenged” earnings per share result (US$1.19 versus Mr. Rosa’s US$1.67 estimate and the consensus forecast of US$1.58) and U.S. LTL adjusted operating ratio (90.3 per cent versus 87.1 per cent and 89.7 per cent, respectively, with a lower number showing higher efficiency), pointing to “the ongoing need for change in culture with its terminal managers to plan more efficient routes and with its salesforce to win business conducive to density.”
“It also noted higher healthcare benefits costs for its union labor relative to both non-union LTLs in the U.S. and its own union-based Canadian LTL that benefits from government-provided healthcare,” he said. “Third it discussed the use of a mix of rail and truck linehaul, which is less efficient vs. using one mode. These are in addition to the loss of certain higher-margin small and medium business, which it noted on its earnings call as a mix headwind that weighed on margins in the quarter. It noted that cross-border freight is only 4-5 per cent of revenues, but Canada represents 30 per cent of its revenues with tariffs potentially driving a recession in the country as well as negative FX impacts, as some of the volume pressure stems from customers holding back volumes on tariff uncertainty. Ultimately, TFII continues to have a goal of becoming a #3 or #4 U.S. LTL franchise which it expects to achieve through M&A to drive density.”
To reflect “ongoing macro weakness and execution risk,” Mr. Rosa reduced his 2025 and 2026 EPS projections to $5.90 and $7.75 from $8.10 and 9.85, respectively. That led him to drop his target for TFI shares to US$130 from US$162, keeping a “buy” recommendation. The average target on the Street is US$136.52, according to LSEG data.
“Management refrained from providing a full-year EPS guide and cautioned about the pace of the macro recovery,” he conclude. “The company continued to say it believes it can achieve EPS in the range of $8.00 in a more normalized operating environment, but acknowledged it does not expect to get there anytime soon given the macro headwinds and idiosyncratic challenges. TFI expects earnings improvement through the year, with results 2H weighted, as shippers gains better visibility on the regulatory environment.”
Elsewhere, Stephens’ Daniel Imbro dropped his target to US$110 from US$138 with an “equal-weight” rating.
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In response to the quarterly results of both TFI International Inc. (TFII-N, TFII-T) and Mullen Group Ltd. (MTL-T) as well as “market commentary that shippers/executives are holding back on contract decisions/ investments amid tariff uncertainty” and its recent dividend cut, Desjardins Securities analyst Benoit Poirier reduced his forecast for Titanium Transportation Group Inc. (TTNM-T) through the end of 2025, emphasizing its “business model is more heavily exposed to Canada–U.S. cross-border freight (we estimate 50 per cent of revenue vs only 5 per cent for TFII).”
“In Canadian peer MTL’s assessment, demand for freight will continue to underwhelm in 2025 as the Canadian economy remains rangebound and is lagging in terms of capital investment, and given the downside risks due to potential U.S. trade disruptions,” he said. “This perception was not helped when TFII announced a week later that it intends to pursue redomiciliation to the US, reported significantly weaker-than-expected results and refrained from introducing formal 2025 EPS guidance, citing a lack of forward visibility. ... Last week on its earnings call, Ryder stated that some cross-border shippers are holding off on signing long-term contracts amid uncertainty about potential tariffs (lack of clarity clearly creating challenges for customers). Moreover, automaker Stellantis will reportedly stop activity at its Brampton, Ontario, assembly plant as part of a reassessment of its “product strategy”—such actions are negative for the Canadian trucking market as the automotive sector is a key freight multiplier.”
Mr. Poirier’s changes come in the wake of a Feb. 7 announcement that the Bolton, Ont.-based company’s has elected to temporarily suspend its dividend “as part of a disciplined financial strategy amid ongoing market challenges and tariff uncertainty.”
“We view this as a negative readthrough for TTNM’s 4Q/1Q results, as well as its ability to generate FCF in this soft environment,” he said.
Keeping a “buy” recommendation for Titanium shares, he cut his target by $1 to $3. The average is currently $3.82.
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U.S. tariff risks are likely to be the main focus of investors when BRP Inc. (DOO-T) reports its fourth-quarter 2025 financial results on March 26, according to National Bank Financial analyst Cameron Doerksen, who sees the threat of a trade war already weighing on sentiment.
“The return of the Trump Administration has again heightened the risk of tariffs impacting BRP as essentially all of its manufacturing is outside the U.S. with 75 per cent of units made in Mexico,” he said. “We have run a downside scenario assuming a full 25-per-cent tariff absorbed by BRP with some offsets from pricing adjustments and operating cost reductions with an annualized potential EBITDA impact of $540-million. While there are a wide range of possible outcomes and BRP management will seek to mitigate the tariff impact, we peg the potential downside for BRP shares at $41.00/share.”
Mr. Doerksen also emphasized end markets for the Valcourt, Que.-based recreational vehicle manufacturer also remain difficult.
“Unfortunately, the tariff threat comes at a time when the broader powersports market continues to suffer through a significant downturn,” he said. “Based on recent competitor commentary, we expect F2026 for BRP will be another challenging year with retail demand still soft and some incremental dealer inventory de-stocking still to come.
“Our view is that the current share price more than reflects a weak powersports market through next fiscal year as well as some tariff risk. On our updated F2026 estimates, which we consider to be trough-like, but do not incorporate a 25-per-cent tariff impact, BRP shares are trading at 6.8 times EV/EBITDA and 14.5 times P/E versus the historical (10-year) forward averages of 7.8 times and 14.4 times, respectively.”
Reiterating a “sector perform” rating for BRP shares, Mr. Doerksen cut his target to $72 from $84 after reducing his forecast for the next fiscal year to reflect his view that “further dealer de-stocking will be necessary and retail demand softness will persist for longer.” The average target on the Street is $83.56.
“BRP was already facing the prospect of another year of a downmarket for powersports, but now faces the much more significant prospect of a 25-per-cent tariff on all Mexican and Canadian imports into the U.S. BRP is formulating a strategy for tariff mitigation, and we suspect a 25-per-cent tariff would not be permanent; however, until there is more clarity, we remain on the sidelines,” he said.
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Citi analyst Alexander Hacking sees Ivanhoe Mines Ltd. (IVN-T) on track for the expansion of its Kamoa-Kakula copper complex in the Democratic Republic of Congo to reach 600,000 tonnes per year, however he warns power availability is impacting costs and delaying smelter ramp-up.
“We update our Ivanhoe model to incorporate 4Q24 results and 2025 guidance. Copper production in 4Q24 reached 134kt with the ramp up of Phase 3 (32kt Cu) on a C1 cost of $1.75/lb,” he said. “Kamoa-Kakula production was reiterated at 520-580kt Cu for 2025. C1 cost was announced at $1.65-$1.85/lb (vs Citi $1.60/lb) with the company citing power availability as the main challenge; in particular, this has delayed the ramp up of the smelter by 3 months until 2Q. Kamoa-Kakula capex is $1.5-billion with $0.3-billion for Platreef and $0.1-billion for Kipushi or $1.9-billion on a 100-per-cent basis in 2025. Company targeting 2Q for updated Mineral Resource Estimate on Western Foreland deposits.”
Based on Citi’s revised copper forecasts, Mr. Hacking reduced his 2025 and 2026 earnings per share estimates to 32 cents and 54 cents, respectively, from 45 cents an 61 cents. That led him to lower his target for Ivanhoe shares to $20 from $24 with a “buy” rating (unchanged). The average on the Street is $23.49.
“Key catalysts are smelter ramp-up lowering costs and Western Foreland updates,” he said.
“Citi is long-term bullish copper, and we believe IVN offers investors the best growth profile in our global coverage.”
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Snowline Gold Corp.’s (SGD-X) flagship Valley deposit in the Yukon continues to demonstrate notable growth potential, according to Desjardins Securities’ Allison Carson, who expects it to “offer a quick payback and a production profile which is attractive to producers.”
“The company is funded for 2025 exploration, and we expect key catalysts this year to include an updated resource estimate for Valley and potentially a preliminary economic assessment by year-end or early 2026,” said the analyst.
“Significant exploration potential exists beyond the Valley deposit on Snowline’s Rogue property and other potential RIRGS discoveries are possible, with the company testing multiple targets. The company has seven other properties across the Yukon, with Einarson and Cynthia demonstrating some exciting exploration potential. Snowline has a strong foundation in the Yukon with CEO Scott Berdahl, a Yukon native and prospector. The company is a leader in environmental stewardship in the Yukon and maintains a good relationship with local First Nations groups. We expect recent infrastructure development announcements to continue to make the Valley project more attractive from an M&A perspective.”
In a report titled Snowline a modern gold rush, she initiated coverage of the Vancouver-based company with a “buy” recommendation.
“Snowline released its initial resource at its 100-per-cent-owned Valley deposit on its Rogue property in 2024 after only two full years of exploration,” said Ms. Carson. “Valley is a greenfield discovery by CEO Scott Berdahl after the company targeted reduced intrusion-related gold systems (RIRGS) in the Yukon. The company completed more than 25,000m of drilling at Valley in 2024, and we expect an updated resource estimate to be released in 1H25. We expect the resource to grow to up to 10moz from 7.3moz and expect further upside to a total of 12moz at the Valley deposit. In addition, we believe there is significant regional exploration upside across its eight properties spanning 360,000 hectares with more than 30 gold targets.
“Valley is a large, bulk tonnage deposit with a high-grade core located at surface. We expect the project to have a quick payback and a tier 1 production and cost profile, making it attractive from an M&A perspective. We currently model a base case of average annual production of 409koz Au at AISC [all-in sustaining cost] of US$911/oz over a 12.8-year minelife.”
Ms. Carson set a target for Snowline shares of $11, implying a potential return of 69 per cent. The average on the Street is $12.50.
“SGD trades at 0.49 times our NAV estimate, a premium to peers at 0.37 times; on an EV/oz metric, it trades at US$93/oz, in line with developer peers at US$90/oz,” she said. “We believe a premium is warranted due to the tier 1 scale of the Valley deposit and the likelihood of its being an M&A target. We expect the company to continue to re-rate toward its junior gold producer peer average of 0.55 times P/NAV as it delivers an updated resource estimate, potentially finds new deposits and advances the Valley project toward development.”
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In other analyst actions:
* CIBC’s Mark Petrie cut his Alimentation Couche-Tard Inc. (ATD-T) target to $87 from $89, keeping an “outperformer” rating. The average on the Street is $88.74.
“We moderate our FQ3 and FQ4 EPS forecasts, largely as a result of more modest U.S. fuel margins, but also unfavourable FX and somewhat slower near-term SSS [same-store sales] trends,” he said.
* CIBC’s Hamir Patel lowered his target for CCL Industries Inc. (CCL.B-T) to $96 from $97 with an “outperformer” recommendation. The average is $90.
“CCL remains our top pick across our packaging/forestry coverage universe. We reiterate our Outperformer rating while adjusting our price target to $96 (from $97) to reflect the Q4 balance sheet and modestly higher near-term capex assumptions,” he said.
* Mr. Patel raised his Nutrien Ltd. (NTR-N, NTR-T) target to US$66 from US$64 with an “outperformer” rating, while Scotia’s Ben Isaacson increased his target to US$62 from US$60 with a “sector outperform” rating. The average is US$60.41.
“We exit Q4 reporting a little more positive on NTR. We looked at five factors below: N, K, Retail, capital allocation, and management credibility. While all five are currently working in NTR’s favour, N sentiment will soon turn negative, and perhaps K sentiment to neutral. But for now, all lights remain green,” said Mr. Isaacson.
* Desjardins Securities’ Lorne Kalmar cut his Dream Office Real Estate Investment Trust (D.UN-T) target to $19.50 from $21 with a “hold” rating, while Scotia’s Mario Saric reduced his target to $20.50 from $21 with a “sector perform” rating. The average is $19.17.
“4Q results were largely in line (ex one-time items), while occupancy declined owing to the known vacancy at 74 Victoria [in Toronto],” he said. “In our view, management’s outlook for 2025 is achievable and seems to be underpinned by relatively conservative assumptions. However, in light of the broader macro uncertainty, elevated vacancy in the downtown Toronto office market and our forecast two-year FFOPU CAGR [funds from operations per unit compound annual growth rate] (2024–26) of 0 per cent, we are maintaining our Hold rating.”
* TD Cowen’s Mario Mendonca bumped his IA Financial Corp. Inc. (IAG-T) target to $147 from $146 with a “buy” rating. The average is $144.63.
“IAG delivered a strong investor day in Toronto on Monday,” he said. “Our lifeco target prices are based on forward BV & P/B [book value and price-to-book] based on our ROE [return of equity] outlook. In this context, we have characterized the recent ROE guidance as an ROE arms-race. We view ROE guidance from MFC/SLF as very ambitious. We are more confident in IAG achieving its guidance than its larger peers. We raised our target P/B for IAG as a result.”
* Ahead of its Thursday earnings release, RBC’s Ryland Conrad raised his Jamieson Wellness Inc. (JWEL-T) target to $41 from $38 with an “outperform” rating. The average is $41.25.
“With strong brand equity and category dominance in Canada, we believe Jamieson is well positioned to benefit from several growth tailwinds for VMS including an increasing focus on health and wellness among consumers globally, supportive demographics as populations age in core markets, and greater demand in emerging markets driven by a growing middle class with higher disposable incomes,” he said. “Against this backdrop, we believe current valuation levels represent an attractive buying opportunity given solid execution, growth runways in China and the U.S. that continue to scale, ongoing product innovation (including GLP-1 companions) and still healthy domestic consumption despite the weaker macro environment.”
* Scotia’s Ovais Habib raised his target for Pan American Silver Corp. (PAAS-N, PAAS-T) to US$28.50 from US$28 with a “sector outperform” rating. The average is US$29.13.
* CIBC’s Paul Holden trimmed his Sun Life Financial Inc. (SLF-T) target to $94 from $95, remaining above the $89.42 average, with an “outperformer” rating.
“Q4 results for the group in general were quite strong. Every lifeco is sitting on excess capital, and valuation multiples are reasonable. Yet, the average stock return YTD is negative (GWO is the only stock up YTD). With tariff risk, we think it is an appropriate time to shift a little money from banks into lifecos. We have outperformer ratings on SLF, IAG and GWO,” he said.
* Stephens’ Daniel Imbro dropped his TFI International Inc. (TFII-N, TFII-T) target to US$110 from US$138 with an “equal-weight” rating. The average is US$136.52.