Inside the Market’s roundup of some of today’s key analyst actions
TD Cowen analyst Derek Lessard thinks GDI Integrated Facility Services Inc. (GDI-T) deal to be taken taken private by its chief executive officer and Birch Hill Equity Partners Management Inc. for $862-million represents a “fair” valuation and sees a low probability of a higher bid.
Also seeing “no clear short-to-medium term catalysts otherwise,” he moved his rating for Montreal-based GDI, a conglomerate that offers janitorial services and heating, ventilation and air conditioning (HVAC) repairs, to “sell” from “hold” previously, recommending investors tender to the cash offer of $36.60 per share.
“We are not overly surprised by [Tuesday’s] announcement,” said Mr. Lessard. “We think that GDI is a good business with a substantial addressable market. However, while we liked GDI’s long-term top-line opportunities and improving profitability/FCF, the company was experiencing above-normal contract churn and renegotiation, particularly in Canada. We believe this reflects businesses trying to optimize costs in a soft macroeconomic environment (i.e. reducing service scope and prioritizing price over quality).
“In the U.S., the wind-down of the remaining 20 per cent of a large contract and lower project volume was driving double-digit organic sales declines. More importantly, it was getting increasingly difficult to compete with private equity, which was substantially outbidding GDI for acquisitions. Consequently, we felt that there was little in the way of catalysts in the short-to-medium term and that the shares would be range-bound for the foreseeable future.”
Mr. Lessard moved his target for GDI shares to $36.60 from $31 to reflect the offer. The average on the Street is $35.80, according to LSEG data.
“Birch Hill paid a premium to current trading multiples,” he added. “GDI was trading at 7.1 times/6.6 times consensus 2025/2026 estimated EBITDA as of market close on Dec. 22. Birch Hill is paying roughly a turn higher than these levels, with the takeout price representing multiples of 8.3 times/7.8 times on the same basis. GDI paid 7.5 times (trailing 12 months) for IH Services in 2021 ($250-million in sales).”
Ahead of the Feb. 12 release of its fourth-quarter results, National Bank Financial analyst Adam Shine reduced his forecast for Telus Corp. (T-T) and now sits below the consensus expectations.
He’s projecting total revenue of $5.32-billion, which represents a drop of 1.1-per-cent year-over-year, a decline from his previous model of $5.441-billion previously and under the Street’s forecast of $5.432-billion. His adjusted EBITDA estimate is now $1.84-billion, down from $1.91-billion and under his peers’ $1.857-billion projection but up 0.1 per cent from the last fiscal year.
Mr. Shine now sees adjusted earnings per share of 23 cents, down from 26 cents previously and lower by 8.7 per cent year-over-year. The consensus is 25 cents.
His changes came a cuts to his revenue from Telus’ Wireless Equipment segment due to lower contracted volumes with a decline in average revenue per user “slowly improving, churn a bit lower“ as well as reductions to his “elevated” Fixed Data revenue forecast to the Street’s level.
“Black Friday promotions appeared later and disappeared sooner without extra pressure compared to last year, but Boxing Day deals look a little more attractive and will stay longer to help stimulate activity,” he said. “We look for a return to more discipline in January where we hope to see this last longer in 1Q26 than it did in 1Q25.”
With those adjustments, he lowered his target for Telus shares to $21 from $21.50, keeping an “outperform” rating. The average target is $20.76.
“Pressure persists on stock amid year-end tax-loss selling,” he noted. “We don’t expect dividend to get cut, but would like to see monetizations in 1H26 rather than fully back-loaded next year.”
In response to its agreement to be acquired by Altius Minerals Corp. (ALS-T) in a stock-and-cash deal valued at about $520-million, Raymond James analyst Brian MacArthur lowered his rating for Lithium Royalty Corp. (LIRC-T) to “market perform” from “outperform” previously.
“The all-cash and all-share consideration is subject to proration, with aggregate cash consideration capped at approximately $174-million and aggregate share consideration capped at 11,500,000 common shares of Altius,” he said. “The transaction is not subject to any financing condition and is expected to close near the end of the 1Q26. The Purchase Price implies an aggregate total equity value of approximately $520-million. In connection with the Transaction, Royalty Capital Funds and Riverstone, who collectively own or control approximately 84.7 per cent of the outstanding shares, have entered into voting and support agreements agreeing to vote their shares in favor of the Transaction at the Meeting. In addition, each of the directors and executive officers of the Company, who collectively hold less than 3 per cent of the outstanding shares, have entered into similar voting and support agreements. The Transaction is the result of a strategic review process led by LIRC’s financial advisors.”
Mr. MacArthur raised his target to $9.50 from $9. The average is $8.50.
“We believe royalty companies like LIRC offer equity investors diversified exposure to commodity prices while mitigating downside risk given limited exposure to operating and capital costs,” said Mr. MacArthur. “At the same time, upside optionality exists through exploration and asset expansion potential. The large projected growth in lithium demand to supply EVs and energy storage is likely to require substantial new lithium supply and numerous lithium companies exist with potential projects. LIRC‘s royalty portfolio is focused on lithium assets with lower jurisdictional risk, higher grade (and therefore lower costs), longer duration, and backed by some strong operators.”
Concurrently, he raised his Altius target to a high on the Street of $43 from $40 with an “outperform” rating. The average is $38.50.
“The transaction provides ALS with 37 new royalties (no streams) with the majority featuring long implied resource lives in lower risk jurisdictions including 4 producing stage royalties and 12 advanced stage projects with completed economic studies with 3-5 additional projects planning to start operations between 2026 and 2030. ALS expects the total expected royalty revenue contribution from the acquisition to ramp up steadily to $40-$60 million by end of decade (at current spot prices),” he said.
In other analyst actions:
* In response to the release of its 2026 budget and the announcement of its $115-million acquisition of Australia’s Iron Mine Contracting, CIBC World Markets’ Chris Thompson trimmed his target for shares of North American Construction Group Ltd. (NOA-T) to $20 from $22, keeping a “neutral” recommendation. The average target on the Street is $24.50.
“We have updated our forward estimates, resulting in a revised 2026E adjusted EBITDA of $395-million, down from our previous estimate of $426-million,” said Mr. Thompson. “These changes reflect the incoming EBITDA from the IMC acquisition as well as a reduction in revenue due to the sale of the 400-ton fleet in Canada. We also anticipate lower activity at Fargo as the project approaches completion. We believe that right-sizing the oil sands fleet and prioritizing healthier segments—such as Australia and infrastructure projects—are positive strategic moves for NACG. We see potential upside to our 2027 estimate if NACG succeeds in securing various infrastructure opportunities in Canada and the U.S."