Inside the Market’s roundup of some of today’s key analyst actions
Heading into third-quarter earnings season for base metals producers, National Bank Financial analysts Shane Nagle and Rabi Nizami see “continued tailwinds" for companies creating precious metal by-products as gold continues to soar, while copper prices continues to benefit from supply disruptions.
“By-product gold prices averaged US$3,458/oz, up 5 per cent quarter-over-quarter benefiting names with strong precious metal by-product production: HBM (approximately 34 per cent of Q3 revenues from gold/silver), LUN (15 per cent), FM (9 per cent),” they said in a research report released late Tuesday. “On the back of continued strong commodity price performance, we are adopting revised near-term prices of US$5.00/lb copper, US$4,000/oz gold and US$50.00/oz silver through to the end of 2027.
“Copper prices have been supported by disruptions at major mines year-to-date, including: Kamoa Kakula, Grasberg, El Teniente, etc... Supply has also been impacted by recent protests in Peru as well as slower ramp-up of larger-scale projects like QB2. We continue to see support from the U.S. Government on developing U.S.-based copper projects and may continue to see a wider COMEX/LME spread as a result.”
Despite their new near-term price assumptions, Mr. Nagle downgraded Teck Resources Ltd. (TECK.B-T) to “sector perform” from “outperform” previously, taking “more conservative" operating assumptions for its Quebrada Blanca (QB) open-pit copper mine in Chile ahead of its latest update on progress on the facility, which was released early Wednesday.
"We have revised our estimates to account for reduced plant availability through to mid-2027 allowing time to retrofit cyclone screening/materials classification circuit and reinforce the existing tailings dam,“ he explained. ”We now model 190,000 t of production from QB in 2026 (was 222,000 t) and have added an incremental US$1.0-billlion in capital costs."
The analyst now sees Vancouver-based Teck falling in line with the implied merger proposal from London-based Anglo American PLC.
Andrew Willis: Investors push back on Teck-Anglo merger over price and index exclusion
“Teck is trading at 4.7-per-cent discount to the currently implied bid from Anglo American,” he said. “Teck shares traded at a slight premium to the implied price for almost a week from the announcement of the deal after which more focus has been turned to required approvals given the commentary from Canadian Government officials.”
“Commitments have been made that the combined Company will be headquartered in Vancouver. Additionally, a substantial proportion of Anglo-Teck’s Board of Directors will be Canadian. Despite these and other commitments, Industry Minister Joly said that the Government would want to see longer-term commitments. The sentiment on the deal changed as Anglo said that it will not re-domicile to Canada nor move its primary listing, while the deal is likely to be approved given the Board’s support of the transaction, it makes an interloper on Teck less likely given the level of concessions ultimately being made by Anglo.”
Mr. Nagle raised his target for Teck shares to $65 from $62.50. The average target on the Street is $60.60, according to LSEG data.
“Shares are up 21.7 per cent since we upgraded on April 24, 2025 (TSX Base Mining Index up 44.0 per cent over the same period) - TECK/B shares also up 36.6 per cent from their recent low on August 20, 2025, in light of the Anglo bid,“ he said. ”With shares trading broadly in line with the Anglo offer, a negative operational update anticipated in the coming weeks at QB and more risk of an interloper acting on Anglo vs. Teck (given commentary from Canadian Government) we feel it’s prudent to downgrade to SP (from OP) at the present time."
The analysts say they now have a “positive” outlook on two stocks ahead of quarterly results, raising their targets for both.
* Capstone Copper Corp. (CS-T, “outperform”) to $15 from $12. The average is $12.22.
Analysts: "We continue to see 2025 operating costs above 2025 guidance; however, the pending announcement of a minority stake sale of Santo Domingo represents a significantly positive near-term catalyst."
* Lundin Mining Corp. (LUN-T, “outperform”) to $25 from $20. Average: $19.34.
Analysts: "We see consistent operational performance in Q3 with costs benefiting from stronger gold sales."
Their other target changes are:
- Ero Copper Corp. (ERO-T, “sector perform”) to $35 from $27. Average: $27.50.
- First Quantum Minerals Ltd. (FM-T, “outperform”) to $36 from $32. Average: $27.84.
- Foran Mining Corp. (FOM-T, “outperform”) to $4.50 from $4.25. Average: $4.42.
- Hudbay Minerals Inc. (HBM-T, “outperform”) to $25 from $22. Average: $20.72.
- Taseko Mines Ltd. (TKO-T, “outperform”) to $7.25 from $6.25. Average: $5.41.
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Analysts at Citibank have raised their copper price forecast, citing "a combination of unprecedented mine outages, still strong demand, and macro trends (Fed cuts and continued USD depreciation, amongst others)."
They now see the metal jumping to US$1,200 per metric ton in the first half of 2026, up from their previous projection of US$1,000. Three-month copper on the London Metal Exchange was sitting at US$10,768 in early Wednesday trading.
"We see a 2026 growth pickup catalyzing $12 k/t copper by 2Q’26 but multiple catalysts could see $12 k/t much sooner,“ the strategists explained. 1. A new Fed chair may be announced in the next one to two weeks, with the possibility they are more dovish than expected (i.e., Kevin Hassett), and/or provide dovish guidance at subsequent press events/speeches (Secretary Bessent said on 2-Oct [CNBC] that he will present President Trump with final candidates this week or next). 2. A China-US deal may be flagged/detailed around APEC meeting on Oct 31/early Nov; President Trump said he plans to meet President Xi around the time of the event (4 Oct, Financial Review) and is motivated to bring capital investment back to the US from China ahead of the mid-terms. 3. The US Supreme Court may nullify reciprocal tariffs, which could result in temporary market exuberance before Section 338 tariffs are imposed. 4. Post the Supreme court decision, President Trump could push Congress to approve $2k per taxpayer earning under $200k at a cost of $200-billion, equivalent to 50 per cent of annualized August tariff revenues – this would be bullish for risk assets. 5. The Supreme Court rules for Lisa Cook’s possible dismissal in January 2026, fueling concerns around Fed independence (lower US real rates). 6. Significant incremental cuts to copper mine supply guidance for 2026 could plausibly be announced through 4Q’25, e.g., a more pessimistic full assessment for Grasberg.”
With that bullish view, equity analyst Alexander Hacking updated his forecasts for copper companies in his coverage universe, leading him to upgrade U.S. giant Freeport-McMoRan Inc. (FCX-N).
"We acknowledge that there is circularity on Grasberg (approximately 3 per cent of mine supply) and the copper price and that copper deficits should ease through 2026 as Grasberg, Kamoa Kakula, and QB2 ramp-up (and Cobre Panama may return at some point, in our view, although more likely 2027 at this point) – but FCX can outperform any fade in copper assuming that Grasberg outcomes are being de-risked, in our view," he said.
"A series of events has left several large copper miners as special situations: FCX (Grasberg), FM (Panama), IVN (Kamoa Kakula), and TECK (Anglo merger). We still see relative value in all of these names vs the non-special situations at SCCO and ANTO. We upgrade FCX to Buy; and remain at Buy on FM and IVN. We remain at Neutral on TECK seeing no near-term catalyst ahead of the proposed merger. We remain at Sell on SCCO as we are still unable to justify valuation in our models with market cap more than $100-billion or more than Vale + Anglo American combined. ANTO is rated Buy by our EU mining team."
Mr. Hacking’s target for Freeport-McMoran shares remains US$48, exceeding the US$46.88 average on the Street,
For Canadian companies, he made these target revisions:
* First Quantum Minerals Ltd. (FM-T, “buy”) to $39 from $26. Average: $27.84.
Analyst: "We see more upside than downside from the current situation in Panama. The stock currently discounts Panama close to zero value, in our view, with very little consideration for potential upside. Downside risks would include a protracted stalemate at Panama or lower copper prices."
* Ivanhoe Mines Ltd. (IVN-T, “buy”) to $18 from $14. Average: $16.97.
Analyst: “We believe IVN offers investors the best growth profile in our global coverage."
* Teck Resources Ltd. (TECK.B-T, “neutral”) to $60 from $55. Average: $60.60.
Analyst: "We rate Teck at Neutral. Positive factors include exposure to copper, several interesting growth options, and a strong balance sheet. Negative factors include historical challenges on execution and a dual-class share structure. On balance, we see equal upside and downside at current levels."
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Precious metals analysts at TD Cowen expected to see “strong” free cash flow and increasing capital returns during third-quarter earnings season as gold “continues to power higher, trading at all-time highs, and as producers remain disciplined.”
“We remain positive on the sector, with the Fed expected to continue easing, and strong investor inflows,” they said, raising precious metal price deck accordingly.
"Gold setting new highs on stagflation concerns and USD weakness: Q3 saw another record-high average gold price of $3,460/oz, up 5.3 per cent from the Q2 average of $3,286/oz. Gold continues to benefit from a supportive macro backdrop, as well as ongoing central bank buying. In September, the FED cut rates by 25 basis points, a move widely viewed as marking the beginning of a broader easing cycle. With real rates still elevated, and inflation expectations climbing, the market is increasingly pricing in slower growth and stickier inflation, driving gold to new all-time highs. Amid a weaker USD (DXY down 11 per cent year-to-date), ongoing tariff tensions, and geopolitical uncertainty, gold continues to attract investor flows. TD’s Commodity strategy group sees potential for a brief correction as gold nears $4,000/oz and silver $50/oz, however they forecast renewed strength into early 2026."
For senior gold producers, the analysts’ target price adjustments are:
- Agnico Eagle Mines Ltd. (AEM-N/AEM-T, “buy”) to US$195 from US$154. The average is US$159.96.
- Barrick Mining Corp. (B-N/ABX-T), “buy”) to US$46 from US$38. Average: US$34.
- Kinross Gold Corp. (KGC-N/K-T, “buy”) to US$30 from US$22. Average: US$22.12.
- Newmont Corp. (NEM-N/NGT-T, “hold”) to US$89 from US$67. Average: US$86.94.
"Our top picks include Agnico Eagle, IAMGOLD, K92, Equinox, and G Mining. Among the royalties, our top pick is Royal Gold,“ the analysts said.
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National Bank Financial analyst Matt Kornack thinks Canadian real estate investment trusts have had “an ok year so far from a trading standpoint” heading into third-quarter earnings season, emphasizing “second order growth continues to drive relative performance with investors looking for inflections but ultimately still favouring sectors/stocks that are mid-cycle from a growth standpoint.”
“Seniors continues to be the standout here, with Retail winning the battle of the large market cap segments (apartments being the laggards),” he added. “A surprisingly strong appetite for credit is helping the former as spreads have reached cyclical lows when looking at the unsecured markets (current avg. 5 / 10-yr spreads are 121 bps / 162 bps, respectively, with most names at historic lows). This provides valuation support as cost of financing has fallen, notwithstanding fairly steady underlying government bond yields, aside from apartments where CMHC spread gyrations are muted.”
In a research report released before the bell, Mr. Kornack made a “modest” 4-per-cent increase to the target prices for REITs in his coverage universe “mimicking a similar move in NAVs given improved financing costs.”
“Investors like what’s working, right now, with some view towards inflections elsewhere - we remain somewhat sector agnostic but are still willing to play names with transitory downside pressures but long-term catalysts (not leaving apartments + industrial for dead),” he said. “By total return we favour seniors, storage and apartments (18-19 per cent), industrial/retail (14 per cent), diversified (6 per cent) with a negative view on office (negative 5 per cent) given recent price appreciation. The aggregate total return across our coverage universe is currently at 14 per cent as trading performance has improved and the sector is looking somewhat reasonably priced with a mid-to-high-single-digit earnings growth expectation combined with a mid-single-digit distribution yield. We still think significant alpha is possible through portfolio selection; that said, there is a clear dichotomy between stocks that are currently working but offer less valuation upside (seniors / retail) and those that are experiencing cyclical headwinds but offer better relative valuations (apartments / industrial).
“Aggregate valuations continue to look reasonable. We tend to use the spread between implied cap rates vs. underlying financing costs (10-yr CMHC rates for apartments and BBB bond yields for other commercial asset types) as a proxy for relative pricing. On average this spread today is 227 bps, which is below the pre-pandemic but post-financial crisis average of 285 bps and just above the 2018-2019 period average (217 bps).”
Mr. Kornack made one rating revision, downgrading Allied Properties REIT (AP.UN-T) to “underperform” from “sector perform” previously, seeing it “valuation rich as over-distribution eats into NAV recovery potential."
“While office fundamentals have selectively improved the sector remains broadly challenged,” he said. “Furthermore, Allied isn’t the ideal vehicle to play the current trend of a return to core PATH connected AAA Toronto buildings by financial institutions. We are hopeful that this represents the start of a positive trend for broader office take-up, but third party stats continue to point to significant vacancies with correspondingly high TI and leasing costs limiting the cash flow benefits of any near-term occupancy gains. The REIT has recently shored up liquidity through issuing unsecured debt and a small disposition program but given what we expect to be a long pathway to stabilization, current annual distributions and elevated leverage levels are borrowing from future growth. As a result of this more somber outlook we see recent trading outperformance as premature, and the current implied cap rate of 6 per cent using a stabilized NOI figure (5.7 per cent excluding occupancy normalization) looks rich vs. the broader REIT universe.”
Calling its current distribution “NAV destructive,” Mr. Kornack raised his target for Allied units by $1 to $17. The average is $18.83.
“Allied continues to pay out $250-million a year to unitholders, which is quite frankly money they don’t have (essentially they are borrowing to fund this payout),” he explaine. “Over-distribution isn’t fully captured in AFFO payout ratio figures (which are already high) given the predominance of non-cash earnings in the form of paid-in-kind interest income and capitalized costs associated with development.
“Development and upgrade projects have seen cost overruns and low yields. Most of the REIT’s recent purchases and development deliveries have been delivered at low single-digit yields on cost, well below prevailing office cap rates. Westbank’s financial woes have meant the REIT has been forced to deploy more capital into these low-return assets.”
The analyst’s updated “focus ideas” include many of the stocks that saw target price adjustments. They are:
Healthcare
* Chartwell Retirement Residences (CSH.UN-T, “outperform”) to $24 from $22.
Analyst: "CSH remains our top pick in the healthcare space, and we still expect a few catalysts to play out over the coming year. This includes occupancy trending to all-time highs, allowing the incremental margin dynamic to play out further and positively impact results. To reflect this, alongside our preview we have raised our 2026 estimates by 5 per cebt on same-property (SP) margin assumptions. We believe positive revisions are likely as our forecast is now 6 per cent higher than consensus. Secondly, as was evident last quarter, CSH’s Growth segment is outperforming. A portion of the segment relates to $1.2-billion in M&A focused on Montreal and Quebec City, markets that are exhibiting accelerating rental growth, and likely a catalyst for units. Lastly, additional capital deployment initiatives, whether it be M&A, development partnerships or dispositions, will continue to high-grade CSH’s overall portfolio. We expect these decisions to shift the portfolio towards higher growth and newer vintage assets that can improve performance."
Multi-Family
* Boardwalk REIT (BEI.UN-T, “outperform”) to $85 from $82.50. The average is $84.45.
Analyst: "In a pretty significant turnaround, BEI has risen to the top of our Canadian apartment pecking order. Better-than-expected results to date (largely on cost management) combined with an inflection in rental spreads as sustained population growth satiates new supply and the REIT’s Edmonton heavy and more affordable offering outperform. Valuation remains attractive on a cap rate basis given outsized NOI growth relative to unit price performance, which has also improved leverage metrics. Cycle wise, we expect investors will gravitate to apartment owners with positively inflecting rental rates and BEI seems to be the first to achieve this benchmark with peers still 12-24 months away justifying our pivot."
* Flagship Communities REIT (MHC.UN-T, “outperform”) with a US$23 target (unchanged). Average: US$22.22.
Analyst: “MHC is our top U.S. housing pick, and a leading total return in our coverage, given its steep valuation discount, despite offering some of the highest organic growth and defensibility in the REIT sector (the latter being increasingly important in today’s economic environment). Trading liquidity is sparse but for those that can, we would happily buy and hold this name."
Self-Storage
* Storagevault Canada Inc. (SVI-T, “outperform”) to $6 from $5. Average: $5.28.
Analyst: "SVI had a good quarter in Q2, exceeding expectations on the organic growth front as a nascent recovery in Canada’s housing transaction market combined with a weaker prior year comp spurred growth to levels not seen in a few years. Housing markets have continued to make modest gains (not so much on price as on volumes, which is the more important driver for storage). Short lease durations mean that this segment is likely to be quicker to inflect and SVI benefits from a sizable geographic footprint in the Alberta market, which remains strong. Valuation also remains attractive relative to some surprisingly expensive trades for assets across Canada by deep-pocketed institutional investors looking to build storage platforms in a segment where portfolios continue to command premiums given scarcity as a result of highly fragmented ownership."
Industrial
* Dream Industrial REIT (DIR.UN-T, “outperform”) to $14 from $13.25. Average: $13.83.
Analyst: "We were keen on industrial when markets were overly punitive on the segment in the midst of trade tensions earlier this year and still think valuations are interesting, but the near-term easy money has been made. Nonetheless, DIR offers a high-quality Canadian and European portfolio with potential transaction catalysts through its GIC relationship. The REIT is still facing some market challenges as new supply is delivered, although Q3/25 stats for Toronto and Calgary were encouraging, Montreal is more competitive albeit in submarkets that are further afield. A still sizable MTM on rental rates and stabilizing occupancy should help deliver stronger organic growth and modest earnings growth justifying a mid-teen total return."
Retail
* RioCan REIT (REI.UN-T, “outperform”) to $21.50 from $19.75. Average: $19.89.
Analyst: "RioCan has been putting up some of the strongest rent growth in our retail coverage universe and seems poised to see continued success in its core retail segment. Our comfort in getting more constructive on the name arises from success to date in mitigating risks around its HBC exposure, a relatively attractive valuation and leverage improvements through residential sales (condo and apartments). 2025 was a noisy year; we expect 2026 to be less so and a focus to return to organic growth on the back of retail leasing performance."
Diversified
* H&R REIT (HR.UN-T, “sector perform”) to $12.50 from $13. Average: $13.29.
Analyst: "H&R has been largely range-bound trading wise following the announcement of its strategic review. While the REIT trades at a significant discount to NAV, it’s a complex vehicle with multi-asset class and geographic exposure combined with asset-specific nuances on ownership and potential tax leakage on a roll-up. As such, we expect any transaction would likely come at a material discount to book value and possibly even to our NAV. Some skepticism on a transaction has risen in the market, which prompted a modest target price adjustment assuming a slightly lower transaction probability and potential price."
Office
* Dream Office REIT (D.UN-T, “sector perform”) to $21.50 from $17. Average: $21.61.
Analyst: "Return to office optimism has impacted office REIT trading and has been seen in third-party stats, particularly in the downtown Toronto market, where Dream has the bulk of its portfolio and NOI generation. The recent run in price has somewhat limited the near-term return prospects but compared to peers, it offers a more compelling valuation, albeit with limited trading liquidity."
Mr. Kornack also made these other target adjustments:
- BTB REIT (BTB.UN-T, “sector perform”) to $3.50 from $3.30. Average: $3.70.
- CAP REIT (CAR.UN-T, “outperform”) to $48.50 from $51. Average: $50.20.
- Crombie REIT (CRR.UN-T, “outperform”) to $17 from $16.50. Average: $16.31.
- CT REIT (CRT.UN-T, “sector perform”) to $17.20 from $15.95. Average: $16.56.
- Extendicare Inc. (EXE-T, “outperform”) to $17.50 from $16.10. Average: $16.51.
- First Capital REIT (FCR.UN-T, “outperform”) to $22 from $21. Average: $21.05.
- Granite REIT (GRT.UN-T, “outperform”) to $87 from $85. Average: $86.78.
- SmartCentres REIT (SRU.UN-T, “sector perform”) to $27.10 from $25.25. Average: $27.53.
Elsewhere, Raymond James’ Brad Sturges downgraded Allied Properties REIT to “underperform” from “market perform” with a $18.75 target, rising from $18.
“We are adjusting our rating for Allied Properties REIT ... based on its premium valuation to our NAV/unit estimate for Allied, combined with elevated investment risks tied to its balance sheet, distribution, and development partner,” he said. “Allied stated within its Oct-7 press release that although leasing velocity is picking up, the pace of occupancy recovery has been slower than anticipated. As a result, Allied will not hit its stated 90-per-cent average occupancy rate target by the end of 2025.
“We believe that Allied could be at risk of giving back some trading ground following a very strong total return of over 60 per cent generated since its recent trading lows reached in April. Heading into its 3Q25 print, we suggest that Allied’s valuation may need to re-calibrate lower to reflect a slower anticipated average occupancy recovery forecast, and reflect elevated investment risks.”
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After upgrading Sun Life Financial Inc. (SLF-T) on Wednesday, TD Cowen analyst Mario Mendonca now has “buy” recommendations for all four Canadian lifecos, which he calls an “unusual, but ... warranted case” and reinforces his view that insurers will “make up material ground relative to the banks over the next 12 months.”
“Recent outperformance from Canada’s banks has the insurers trading at a 22-per-cent discount to the banks on a forward P/E basis, a sharp reversal from near parity six months ago,” he added. “Relative valuation, greater capital flexibility and lower downside risk to earnings in a potential economic downturn support favouring the insurers.”
He said his move of Sun Life from a “hold” rating previously “reflects a number of considerations including valuation, repricing in the U.S. healthcare segment, and excess capital.”
“Canada’s life insurers report Q3/25 results from Nov 4-12,” said Mr. Mendonca. “Forecasted EPS growth of 8 per cent year-over-year remains healthy, and reflects MFC, SLF & IAG beating consensus estimates this quarter. We see good momentum in new business across most wealth management businesses (MFC’s GWAM, IAG’s segregated fund business, Empower’s retirement operations and SLF’s alternative asset manager SLC Management). We expect Asian insurance sales growth at MFC and SLF to slow, but from the very lofty levels of the last 12 months. While net investment income (including earnings on surplus) growth is slowing (lower rates & surplus used for share repurchases), a lower share count (3-4-per-cent year-over-year declines for SLF & MFC) supports both EPS growth and progress toward ROE targets.
“Rate actions in U.S. healthcare support SLF margins. While higher utilization trends should continue to drive experience losses in SLF’s U.S. group insurance and we do not expect strong results in dental, our estimates have the U.S. business delivering slightly stronger earnings on a quarter-over-quarter basis. Rate actions should drive better sequential results in stop loss in Q3/25 and restore margins in this key segment by mid-2026. We have SLF comfortably beating estimates in Q3/25.”
Mr. Mendonca raised his target for Sun Life shares to $101 from $89. The average is $90.42.
His other changes are:
- Great-West Lifeco Inc. (GWO-T) to $66 from $59. Average: $57.60.
- IA Financial Corp. Inc. (IAG-T) to $175 from $158. Average: $156.67.
- Manulife Financial Corp. (MFC-T) to $54 from $50. Average: $48.08.
Elsewhere, Barclays’ Alex Scott raised his targets for Great-West Lifeco to $58 from $57 with an “overweight” rating, Manulife Financial to $48 from $47 with an “equal-weight” rating and Sun Life Financial Inc. to $84 from $82 “underweight”.
"Heading into the quarter, we remain optimistic around fee-based earnings and group benefits. Additionally, we don’t see the 3Q actuarial review causing much noise this year," said Mr. Scott in a preview of North American life insurance quarterly results.
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TD Cowen analyst Brian Morrison thinks the third-quarter earnings release from Canadian Tire Corp. Ltd. (CTC.A-T) on Nov. 5 is unlikely to be a catalyst for its shares “as it remains early stages of its investment cycle for both Retail/Financial Services.”
“The anticipated timing to realize benefits/operating leverage from heightened IT investment is our key focus, followed by dealer inventory/replenishment trends, the outlook for credit trends, and its go-forward capital allocation strategy,” he sai in a client note.
Mr. Morrison is currently projecting earnings per share of $2.97, exceeding the Street’s forecast by 6 cents but down 5 per cent year-over-year after adjusting for one-time real estate gains/insurance recoveries realized in normal course operations in fiscal 2024.
“On the positive, we forecast revenue growth for both segments with Retail improving on positive demand trends/dealer replenishment beginning to take hold, and CTFS due to on GAAR growth,” he said. “This should be more than offset by heightened SG&A (IT investment) in Retail and CTFS to support future growth.”
“The focus to become a ‘more tech driven, agile, and efficient’ operating company requires investment targeted toward digital/store experiences, expanding its loyalty program, and capitalizing upon its data resources. The incremental annual investment ($60-million) outlined in spring 2025, appears to have been increased in Q2/25 specifically within CTFS. These investments should be offset by restructuring costs to streamline its operating structure/synergies commencing in Q4/25. Clarity on the timing of these initiatives driving operating leverage we view as key to identifying a potential catalyst.”
After “modest” updates to his financial forecast, Mr. Morrison reduced his target for Canadian Tire shares by $1 to $183 with a “hold” rating. The average on the Street is $176.10.
“We remain positive upon CTC’s midterm outlook as its True North strategy should facilitate top-line growth, facilitate operating leverage as this takes hold, and support an active NCIB,” he concluded. “With this transformation potentially weighing upon near-term financial performance, we see alternatives within our Consumer Demand coverage that could generate more attractive returns at this time.”
“We see attractive value in CTC at the current level over the midterm as it takes positive steps toward becoming a better retailer aligned with the required trends of the future, that we believe should sustain solid top-line growth. That said, we feel that near-term catalysts are pushed out slightly, as investment expenses limit the ability to significantly outperform consensus in H2/25, that will also be a headwind to near-term multiple expansion.”
In a separate report released Wednesday, Mr. Morrison also trimmed his Spin Master Corp. (TOY-T) target to $29 from $31, keeping a “buy” rating ahead of its Oct. 30 quarterly release. The average is $28.75.
“While POS appears stable for Spin Master, ongoing industry/retailer headwinds continue to pressure the outlook limiting investor confidence in near-term financial forecasting. We view the valuation as punitive, but with recent shortfalls in meeting consensus expectations, visible catalysts that we believe are at least another quarter away are likely required to improve investor sentiment,” he said.
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As earnings season approaches for Canadian retail and restaurant companies in his coverage universe, Scotia Capital analyst John Zamparo sees a “divergence in sentiment and spending” continuing.
“While consumer sentiment and unemployment (at least in Canada) point to an expectation of subdued spending, actual consumption data continue to hold in fairly well. University of Michigan sentiment scores remain soft, in the mid-50s in September (vs. low 60s in July); Conference Board of Canada results are similar (60 in August, down a few points from July),” he said in a client report. “Meanwhile, Q2 real consumer spending growth was 3.6 per cent in Canada and 2.7 per cent in the U.S.. A generally bullish market seems increasingly willing to downplay what we expect (based on Scotiabank Economics’ projections) to be fairly pedestrian levels of consumer spending growth next year.”
“Our estimates for all these companies generally align with consensus. Among all these stocks, we remain most constructive on SAP because of its improving FCF and capital return profile, internal improvements driving EBITDA growth and a potentially favorable commodity still to come in the future. PBH has become more compelling in our view because of the materialization of new contract wins, though we do not foresee Q3 as a positive catalyst.”
Mr. Zamparo made “modest” forecast adjustments to several companies, leading to target price adjustments. They are:
* Maple Leaf Foods Inc. (MFI-T, “sector perform”) to $32 from $35. The average is $38.07.
Analyst: "Likely a noisy quarter from MFI. Following completion of its spin-out of Canada Packers, MFI now trades on a standalone basis. Volumes for both MFI and CPKR have been elevated and we expect this will remain so in the coming days and perhaps weeks. We expect this to be particularly true for CPKR as the stock likely must find a different shareholder base than the existing MFI shareholders. CPKR is now trading at the mid-point of the range we identified based on the fairness opinion."
* MTY Food Group Inc. (MTY-T, “sector perform”) to $42 from $45. Average: $47.17.
Analyst: "We have decreased our margin and EBITDA estimates to reflect industry-wide macro headwinds and an ongoing promotional emphasis within the restaurant space stateside. Our estimates are now largely in line with consensus."
* Premium Brands Holdings Corp. (PBH-T, “sector perform”) to $103 from $100. Average: $111.75.
Analyst: "We have reduced our Q3 EBITDA estimate to reflect ongoing commodity headwinds, particularly beef inflation which has remained in double-digit territory in Q3. Our estimates are now largely in line with consensus."
* Restaurant Brands International Inc. (QSR-N/QSR-T, “sector perform”) to US$73 from US$71. Average: US$76.84.
Analyst: "We expect investors to focus on the following: a) performance from BK as MCD has reduced menu pricing; b) commentary on four-wall profitability in BK US, relating to a possible future decrease in the BK ad fund contribution in 2027; c) resilience of Tims in a subsiding Buy Canada environment; d) performance of INTL; e) progress on initiatives to reduce peak complexity (BK China sale, Carrols refranchisings, Reclaim the Flame projects)."
* Saputo Inc. (SAP-T, “sector outperform”) to $37 from $36. Average: $35.78.
Analyst: "Our revised estimates reflect more favorable FX and a greater negative impact in Europe to account for the UK plant decommissioning late this quarter. Versus Q2 consensus, our estimates are 2 per cent below on revenue, in line on EBITDA and 1 per cent lower on EPS."
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In other analyst actions:
* Citing “improving fundamentals backed by new discoveries and planned expansion at Santa Elena and Gatos supporting strong leverage to higher silver price,” TD Cowen’s Wayne Lam upgraded First Majestic Silver Corp. (AG-T) to “buy” from “hold” with a $22 target, up from $14. The average is $17.81.
“Our recent site visit to Gatos highlighted its strategic importance, providing AG with lower-cost production via a long-lived asset. Over the past year, AG has continued to drive the plant’s outperformance, demonstrating its ability to reach 4,000 tpd. As such, focus has centered around ramp up of mining rates to match the mill, with an emphasis on increased proportion of longhole stoping, mobilizing additional contract labour and incremental fleet purchases. This is supported by ongoing drilling, which has encountered mineralization at depth via multiple zones, including SE Deeps, providing upside outside the current resource. Overall, we view the Gatos asset constructively, with ramp up to targeted expansion by YE2026,” said Mr. Lam.
* In a research report titled A Fresh Cut, RBC’s Irene Nattel initiated coverage of Canada Packers Inc. (CPKR-T) with a “sector perform” rating and $18 target. The average is $19.33.
“CPKR is a high-quality business with strong FCF/conversion, ability to moderate debt levels and capacity to drive modest volume growth,” she said. “CPKR’s modest market cap/float is likely to moderate investor interest, but if management can consistently deliver EBITDA within targeted range of $170-185-milion, CPKR could find a place in small cap portfolios, particularly given estimated initial dividend/ yield. Catalysts to become more constructive include: i) leveraging premiumization strategy to help buffer commodity-related volatility, ii) execution of modest growth agenda, and iii) successful debt reduction.”
* Ms. Nattel cut her Maple Leaf Foods Inc. (MFI-T) target to $34 from $38 with an “outperform” rating. The average is $38.07.
“The spin-off of Canada Packers Inc. marks a pivotal moment for Maple Leaf Foods, allowing MFI to focus entirely on its value-added and branded product portfolio. In shedding the commodity- pork segment, MFI transitions into a more agile company, geared toward targeting consumer-driven trends in protein innovation and sustainability. But as always we caveat that the road from here to there is often bumpy,” she said.
* Previewing earnings season for Canadian trucking and diversified industrial companies, RBC’s Walter Spracklin and James McGarragle raised their targets for Mullen Group Ltd. (MTL-T, “outperform”) to $15 from $14, Stella-Jones Inc. (SJ-T, “sector perform”) to $87 from $78 and TFI International Inc. (TFII-N/TFII-T, “outperform”) to US$106 from US$102. The averages are $15.83, $86.59 and US$115.19, respectively.
“We flag that all the mid-quarter data updates we track (US LTL, FedEx, and Cass) highlighted a weak volume backdrop during the quarter and that Canadian PMI readings continue to trend below 50 pointing to a soft outlook looking ahead. We therefore took down our Q3 estimates across the group (ex-SJ). We flag however that the weak backdrop is to a degree reflected in current valuation, with CJT, MTL, and TFII all trading toward the bottom of their 5-year ranges. Furthermore, we rolled forward our valuation year to 2027 and re-established our target multiples for the 2027-year across the group. Into the quarter we expect visibility into freight demand (for CJT, MTL and TFII) to be a focus and any commentary on the tariff impact,” they said.
* JP Morgan’s Brian Ossenbeck cut his targets for Canadian National Railway Co. (CNR-T) to $153 from $154 with a “neutral” rating and TFI International Inc. (TFII-N, TFII-T) to US$104 from US$116 with an “overweight” rating, while he increased his Canadian Pacific Kansas City Ltd. (CP-T) target to $137 from $131 with an “overweight” rating. The averages are $155.94, US$115.19 and $122.07, respectively.
* Seeing Montage Gold Corp. (MAU-T) making “good progress” at its flagship Koné project in Côte d’Ivoire, National Bank’s Mohamed Sidibé raised his target for its shares to $8.75 from $8, exceeding the $7.85 average, with an “outperform” rating.
" Our investment thesis is supported by (i) a valuation re-rate as Koné development is de-risked and advances towards first gold; (ii) additional NAV accretion as Montage delivers on near-mine and regional exploration driving resource accretion, production and FCF growth. Our model now reflects some positive exploration upside in our DCF with our initial 10-year production profile now averaging 305koz vs. the technical report at 274koz," he said.
* Stifel’s Greg MacDonald initiated coverage of MDA Space Ltd. (MDA-T) with a “buy” rating and $48 target, exceeding the $42.93 average on the Street.
“Defence is being disrupted by private capital, Silicon Valley best-practices and a political shakeup in procurement – for non-terrestrial this is called New Space,” he said. “Our investment thesis for MDA is as follows; 1) Space 2.0 has enabled mega-constellations of smaller/cheaper/shorter-life and higher performance satellites in LEO, creating a manufacturing boom with high replacement cycle, 2) commercial broadband, D2D and earth observation have enhanced TAM growth, with Defence requirements extending the cycle in a dual-use industry structure, 3) MDA’s expertise is in the sweet spot of digital satellites, a competitive advantage and 4) M&A can enhance MDA’s satellite primec ontractor position for further share gains. We are initiating coverage of MDA Space with a BUY rating and $48 target – we believe MDA should be a core holding for the NATO+ defence spending theme.”
“While the stock has appreciated 90 per cent in the past year (vs 26-per-cent TSX), this is mainly due to EPS growth as the forward multiple is up only three points to 22 times. We think competitive concerns over the recent Echostar contract loss are overdone. We anticipate more mega-constellation wins and see potential for significant multiple expansion as the market recognizes a shift to less cyclical recurring revenue associated with LEO satellite replacements. In short, the stock could benefit from both EPS growth and multiple expansion.
* CIBC’s Luke Bertozzi initiated coverage of Wesdome Gold Mines Ltd. (WDO-T) with a “neutral” rating and $24 target, exceeding the $23.17 average.
“Wesdome’s ‘Fill-the-Mill’ initiative and ongoing exploration provide a credible plan to support a production profile that is higher for longer. However, we view the shares as approaching fair value pending operational improvements at Kiena, as well as greater clarity on capital allocation,” he said.
* Barclays’ Benjamin Budish cut his TMX Group Ltd. (X-T) to $58 from $60 with an “equal-weight” rating. The average is $62.06.