Inside the Market’s roundup of some of today’s key analyst actions
In response to a “huge” rise in share price, National Bank analyst Maxim Sytchev now thinks the risk-reward proposition for Aecon Group Inc. (ARE-T) has “normalized,” leading him to lowered his recommendation to “sector perform” from “outperform” and warn investors “2026 forecasts are great but we still need to get through 2025.”
“With government goodies being doled out at the provincial/federal levels and focus on fringe issues like bike lanes that would typically be the purview of municipal-level conversations, we surmise that having a marquee project operational in the short term is unlikely (in addition to previously telegraphed 6 months heads up that Metrolinx would need to give to the province; suggesting that H2/25E is a more realistic timeline, hopefully),” he said in a research report released Wednesday.
“Well, that means that Q4/24E and H1/25E impute three quarters of haggling around who is paying for what and how much. And because the provincial government is disbursing stimulus on the one hand, why would it be ‘gentle’ when it comes to final negotiations? That means that the potential of working capital drag/write-downs remains and while the shares, of course, rallied on the back of Q2/24 discourse that perhaps it’s not “as bad as expected”, there is a big difference between the same outcome while shares were trading at $14 vs. $28 now, with the vast majority of share price appreciation attributed to MULTIPLE expansion. Expectations of ARE’s TSX 60 inclusion is also front and centre (i.e., no longer a catalyst).”
Mr. Sytchev now sees the Street’s expectations for the Toronto-based construction company as “aggressive” and sees notable downside risks. He also emphasized its valuation now approaches peer Bird Construction Inc. (BDT-T) “despite higher tail risks.”
“The pullback in the magnitude of backlog expected to be recognized in the next 12 months has moved down 13 per cent quarter-over-quarter (total backlog also fell below $6 bln for the first time since Q1/21), clouding the near-term revenue outlook somewhat,” he said. “Granted, the ‘quality’ of the backlog has certainly improved with the wind down of the fixed price portfolio, but ultimately the revenues will need to come from somewhere. Given the issues seen in this portfolio, investors will no doubt continue to scrutinize Aecon’s execution for the foreseeable future. In this context, Aecon’s 6.7 times EV/2025 estimated EBITDA multiple reflects much higher expectations and is very close to BDT at 7.8 times, a company which has brought investors far less unpleasant surprises over the last few years.”
While acknowledging he may be “taking our foot off the gas too early,” Mr. Sytchev said the risk/reward skew is now balanced, despite raising his target for Aecon shares to $30 from $28 after introducing his 2026 forecast. The average target on the Street is $30.09, according to LSEG data.
“What can go wrong? Stepping away too early from BDT/CIGI was the wrong call in early 2024. Are we repeating the same mistake? We wish we had an unequivocal answer to that question. We simply do not know,” he said.
“That being said, a simple risk/reward framework can provide some parameters for decision-making. 1) Let’s say there is no write-down over the coming nine months and working capital is not an issue despite some cautious language from management on the Q3/24 call. We deem this unlikely given the lack of news on the large projects’ commissioning timelines and our experience that write-downs typically take place at the very end of contract completion and Q4s as there is a greater level of scrutiny from auditors / calibration exercise for the subsequent year. Again, if nothing happens, great, don’t forget shares are up close to 2 times in seven months, so at least part of that dynamic is already reflected in the current set-up. 2) There is another $50-$100-million write-down, either EBITDA or working capital, within the previously telegraphed envelope; well, bulls can say it does not matter and the market is forward-looking (it is) but why take a chance that there is a small probability of more protracted negotiations, a warranty period uncovering issues on something that’s five years too late, etc. So, in a sense, there is some incremental upside to let’s say BDT’s 2026E EV/EBITDA if applying to ARE (in the 10-15-per-cent range) or equivalent to more downside if things get delayed a bit, especially in light of potentially the Street being too aggressive with 10-per-cent year-over-year top-line growth in 2025.”
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Mr. Sytchev’s call on Aecon came alongside the release of a report introducing 2026 projections for industrial product companies in his coverage universe and the unveiling of his top picks for the coming year in a report titled Top 10 2025 bifurcations, what worked (or didn’t) in 2024.
Stressing the presence of “many cross currents” in 2025, the analyst thinks the “2026 playbook is favourable” thus far.
“On the one hand, overlaying the 2016 Trump playbook would suggest a positive year ahead for us (up 26 per cent for our coverage 15 months post-presidential election first time around) as, in addition to the perception of a pro-business agenda, rates are being cut now vs. the commencement of a tightening cycle in late 2016.” he said. “The counterpoint is that valuations for our coverage are now 700 basis points to 800 basis points higher on a P/E basis vs. then (S&P 500 NTM [next 12-month] P/E is 500 bps higher). The caveat being of course 2 times higher organic growth momentum for engineers vs. pre-2019; that, plus margin expansion explain a lot of the fundamental revaluation.
“Directionally, it still means that alpha needs to come from EPS growth and accretive M&A as multiple expansion is unlikely to be a major catalyst. While we have seen a recent wobble of Federally exposed names (TTEK, ACM, BAH), IIJA funding is unlikely to be impacted given the program’s substantial appropriations to specific projects while in our coverage the maximum Federal exposure is 5-per-cent (STN). As a result, we skew towards names with the most predictable EPS trajectories, counterbalanced by reasonable valuation (as outright mispriced situations are not exactly present). A postmortem of what went right/wrong for us in 2024 ... RBA/CIGI worked; ATS did not.”
Mr. Sytchev thinks “what-ifs” for 2025 are “dominated by macro factors that, except for sticky inflation” and sees them as “generally neutral” for companies he covers “while the protectionist pivot in North America is actually a net positive given predominantly service-driven revenue generation and/or in situ production capacity in the U.S.
In rolling out his top picks, he said:
“We are slightly expanding our preferred places to allocate capital this year, partly to capture beta in structurally growing areas like consulting (need to own something) while leaning into some self-help & margin expansion + easier comps vs. 2024 dynamic for others. There is also a sweet spot for a Trump trade. STN shares lagged peers in 2024 on the back of a very strong 2023; we believe organic EPS growth will be supplemented by additional M&A that has historically buoyed the stock. RBA had a great 2024 but margin expansion opportunity should lead to further multiple progression; market share gains have come faster than expected. ATS – an annus horribilis due to EV unravelling is finally behind us; market concerns around working capital are real, but a negative outcome appears to be priced in; Healthcare / Food / Nuclear are structural growth areas. FTT Product Support softening + past peak new equipment pricing created an air pocket; we see Canada getting less bad while Chile’s copper momentum should sustain itself; through-the-cycle EPS generation is still getting better. RUS “Easy” Trump trade beneficiary without a premium multiple; clean balance sheet, integration upside from recent M&A and more deals down the line with free HRC / plate pricing optionality.”
With that view and the introduction of his 2026 projections, Mr. Sytchev made these target changes:
- AutoCanada Inc. (ACQ-T, “outperform”) to $25 from $21. The average on the Street is $19.29.
- Ag Growth International Inc. (AFN-T, “outperform”) to $75 from $72. Average: $71.63.
- AtkinsRéalis Group Inc. (ATRL-T, “outperform”) to $87 from $67. Average: $81.58.
- ATS Corp. (ATS-T, “outperform”) to $54 from $46. Average: $48.71.
- Bird Construction Inc. (BDT-T, “sector perform”) to $32 from $29. Average: $34.44.
- Colliers International Group Inc. (CIGI-Q/CIGI-T, “outperform”) to US$182 from US$168. Average: US$164.08.
- Finning International Inc. (FTT-T, “outperform”) to $48 from $47. Average: $47.
- North American Construction Group Ltd. (NOA-T, “outperform”) to $45 from $40. Average: $39.60.
- RB Global Inc. (RBA-N/RBA-T, “outperform”) to US$113 from US$101. Average: US$98.70.
- Russel Metals Inc. (RUS-T, “outperform”) to $55 from $49. Average: $50.92.
- Stella-Jones Inc. (SJ-T, “outperform”) to $93 from $90. Average: $89.25.
- Stantec Inc. (STN-T, “outperform”) to $140 from $128. Average: $130.32.
- Toromont Industries Ltd. (TIH-T, “sector perform”) to $126 from $132. Average: $135.22.
- Wajax Corp. (WJX-T, “sector perform”) to $24 from $23. Average: $23.75.
- WSP Global Inc. (WSP-T, “outperform”) to $286 from $279. Average: $277.93.
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Following Tuesday’s release of weaker-than-anticipated fourth-quarter results that disappointed the Street, RBC Dominion Securities analyst Darko Mihelic continues to model “good” core earnings per share growth of 10 per cent for Bank of Nova Scotia (BNS-T) in 2025 despite lowering his estimates and emphasizing his previous expectations were “too high.”
Shares of Scotiabank slid 3.4 per cent after it reported adjusted EPS of $1.57 for the quarter, falling below both Mr. Mihelic’s estimate of $1.69 and the consensus projecting of $1.60. He noted the results “excluded 34 cents of adjusting items ($417-million after-tax on a dollar basis) which comprised impairment charges related to BNS’s investment in associate, Bank of Xi’an ($309-million after-tax) and certain software intangible assets ($70-million after-tax), and severance provisions ($38-million after-tax).”
With the results, Mr. Mihelic chopped his earnings expectations for all of the bank’s operating segments, resulting in a reduction in his 2025 core EPS estimate by 46 cents to $7.09 (was $7.55) and his 2026 core EPS projection by 62 cents to $7.94 (was $8.56).
“We were a little too bullish on BNS’s earnings power and now drop our earnings estimates closer to BNS guidance; nevertheless, we still see some positives in the quarter and in BNS’s messaging,” the analyst said. “As modeled (and guided), we see a rebound in earnings power in 2026 and positive operating leverage should expand in 2025 and be healthy in 2026. In addition, BNS’s guidance on credit losses suggests impaired PCLs will rise with small performing PCL releases. We think the releases will be small and may in fact be builds if current uncertainty is resolved negatively. The increase in PCLs is not completely at odds with our previous view and suggests a mild peak level of PCLs for BNS (and we suspect this to be the case for all banks we cover with the possible exception of BMO).”
However, Mr. Mihelic raised his target price-to-earnings multiple (to 10.5 times from 9.0 times), saying “we do not believe that the probability of significant mortgage payment shock and high unemployment is as high as we previously believed.” That led him to raise his target for Scotia shares to $74 from $65, reiterating a “sector perform” recommendation. The average on the Street is $79.47.
Others making changes include:
* TD Cowen’s Mario Mendonca to $81 from $82 with a “buy” rating.
“Scotia missed our estimates (modestly) primarily on lower fee income,” he said. “We believe shares were lower on a weaker outlook for IB driven by softer economic growth (driving lower loan growth and capital markets activity). Our upgrade prior to Q4/24 remains supported by a longer term outlook for ROE expansion driven by improving NIM and NIX, both of which were evident in the quarter.”
* Desjardins Securities’ Doug Young to $79 from $76 with a “hold” rating.
“Adjusted pre-tax, pre-provision (PTPP) earnings were in line with our estimate, while cash EPS was a penny short of our forecast (C$0.03 below consensus). Management kept its earnings growth outlook of 5–7 per cent in FY25 (excluding the contribution from the KEY stake) and expects double-digit growth in FY26 (including KEY). We revised our estimates down, increased our target price,” said Mr. Young.
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RBC Dominion Securities analyst Maurice Choy “favourably” views Enbridge Inc.’s (ENB-T) 2025 outlook, which he thinks “not only saw the consensus being near the low-end of the EBITDA range, but also appears to contain a number of relatively conservative assumptions relating to Mainline volumes and the USD/CAD exchange rate.”
“Big picture, we believe the company’s core businesses remain positioned to benefit from favourable secular energy trends in North America that support the delivery of multi-year earnings, cash flow and dividend per share growth on an equity self-funded basis,” he said.
On Tuesday, the Calgary-based company revealed its expectations for the next year, including an EBITDA range of $19.4-20.0 billion, exceeding the consensus projection of $19.471-billion, as well as a discounted cash flow per share range of $5.50-5.90 with the mid-point being in line with the Street’s expectation heading into the quarter.
“Secular energy growth themes continue to support Enbridge’s multiyear growth outlook,” said Mr. Choy. “Beyond reaffirming its 2024 guidance (including the directional EBITDA guidance upgrade as part of its Q3/24 results release), the company reaffirmed its 2023-2026 CAGRs [compound annual growth rates] of 7-9 per cent on EBITDA, 4-6 per cent on EPS, and approximately 3 per cent on DCF/share.
“Funding plan remains intact, including no new common equity required. Enbridge expects its 2025 capex will be roughly $8 billion, inclusive of $1 billion of maintenance capex. Along with $8 billion of common share dividend payments, the company anticipates its funding needs to be met through internally generated cash flows ($14 billion), and net new debt issuances ($2 billion). Importantly, Enbridge expects to end 2025 “well within” its 4.5-5.0 times target debt/EBITDA range.”
Alongside an in-line 3-per-cent raise to its dividend, Mr. Choy made “modest” increases to his EPS projections to “primarily reflect higher estimates for the Gas Transmission & Midstream, and Eliminations & Other segments, partially offset by higher financing and associated income tax expenses.” That led him to raise his target for Enbridge shares to $63 from $59, keeping an “outperform” rating. The average is $61.08.
Other analysts making target revisions include:
* National Bank’s Patrick Kenny to $60 from $58 with a “sector perform” rating.
“With the company’s $7-billion growth capital guidance for 2025 sitting below its $8-$9-billion of annual investment capacity, combined with D/EBITDA expected to end the year comfortably within its 4.5-5.0 times target range (NBF: 4.7times), we highlight an opportunity for ENB to accelerate its organic gas infrastructure investments,” he said. “Recall in our recent thematic, The Big Data Buildout — assessing bluesky valuation upside…, we tallied approximately $2.50 per share (5 per cent) of valuation upside from data center related infrastructure expansion opportunities across its Gas Transmission and Gas Distribution footprints.
* Scotia Capital’s Robert Hope to $61 from $57 with a “sector perform” rating.
“Enbridge’s 2025 outlook was better than expected on an EBITDA basis driven by a strong Gas Transmission contribution. The company also announced a 3-per-cent dividend increase for 2025 (effective March 1), which was in line with our estimate. We increase our 2025/2026 EBITDA estimates largely to reflect the stronger-than-expected outlook for the Gas Transmission business, though our EPS estimates don’t materially move given higher financing costs, income taxes, and other items. Commensurate with our higher EBITDA estimates and to reflect continued strong Gas Transmission growth, we raise our target price to $61 from $57, which implies an 11.8 times 2026E EV/EBITDA versus 2025E recent trading levels of 12.1 times. With a 6-per-cent dividend yield and a de-risked funding plan, we believe the shares could be attractive to longer-term income-oriented investors,” said Mr. Hope.
* BMO’s Ben Pham to $60 from $59 with a “market perform” rating.
“While we continue to like ENB’s 6-per-cent dividend yield and the diverse energy infrastructure franchise, we believe the shares are fairly valued at current levels. As such, we rate ENB Market Perform,” he said.
* CIBC’s Robert Catellier to $62 from $61 with an “outperformer” rating.
“We characterize this investor update as positive, with the guidance generally being in line with our estimates. Effectively, we see the investment proposition as unchanged, namely consistent growth and strategy coupled with sound risk management through hedging of FX and interest rate exposure. The dividend increase was in line with expectations, and the capital allocation strategy remains unchanged,” said Mr. Catellier.
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In a research report released Wednesday previewing 2025 for Canadian industrial and transportation companies, CIBC World Markets analyst Kevin Chiang made a pair of ratings revisions to stocks in his coverage universe on Wednesday.
He upgraded Airboss of America Corp. (BOS-T) to “neutral” from “underperformer” with a $5 target, up from $4. The average is $5.63.
“While we still maintain a level of caution, we believe its shares have found a trough level,” he said.
Conversely, he lowered CAE Inc. (CAE-T) to “neutral” from “outperformer” with a $33 target, exceeding the $32.04 average.
“We continue to have a positive view on the secular tailwinds that should benefit CAE’s Civil segment and are optimistic that the company has improved visibility on when its legacy problem contracts exit the backlog,” he said. “Our downgrade primarily reflects the company’s share price outperformance. We now see a more balanced risk/reward profile at current levels.”
In the same report, analyst Krista Friesen upgraded NFI Group Inc. (NFI-T) to “outperformer” from “neutral” to reflect “the weakness in the company’s share price.” Her target rose to $21 from $18.50, topping the $20.30 average.
“We believe that, at current levels, concerns related to near-term supply chain disruptions are priced in. We continue to foresee NFI benefiting from a strong demand environment, backstopped by its multi-year backlog
Mr. Chiang also made these target revisions:
- Air Canada (AC-T, “outperformer”) to $28 from $27. Average: $26.38.
- Bombardier Inc. (BBD.B-T, “outperformer”) to $132 from $131. Average: $118.07.
- Cargojet Inc. (CJT-T, “outperformer”) to $177 from $172. Average: $160.73.
- GFL Environmental Inc. (GFL-T, “outperformer”) to $75 from $69. Average: $65.25.
- TFI International Inc. (TFII-N/TFII-T, “outperformer”) to US$176 from US$166. Average: US$164.18.
Ms. Friesen’s changes included:
- Ballard Power Systems Inc. (BLDP-Q/BLDP-T, “underperformer”) to US$1.20 from US$1.40. The average is US$2.03.
- Exchange Income Corp. (EIF-T, “outperformer”) to $69 from $66. Average: $69
“2024 was a solid year for the industrial/transportation equities we cover, which were up 18 per cent on a market-cap-weighted basis in C$, vs. the S&P/TSX up 22 per cent year-to-date and the S&P up 26 per cent YTD (through November 27),” the analysts said. “We saw strong performance from the waste sector and from the aviation/aerospace sector. The freight names we cover faced a more challenging backdrop. We are more optimistic heading into 2025. We foresee an improving backdrop for the freight sector, with 2025 being a transition year. We anticipate that strong underlying fundamentals will benefit the North American solid waste sector and expect outsized margin expansion in 2025. We expect improved supply/demand dynamics in the Canadian aviation sector next year, and that the aerospace names we cover should continue to benefit from a healthy demand outlook [i.e., in maintenance, repair, and operations (MRO), pilot training, and business jet deliveries].
“The elephant in the room as we head into 2025 remains the risk of the Trump administration enacting broad-based tariffs, with the President‑elect noting he plans to implement a 25-per-cent tariff on Canada and Mexico immediately upon taking office. Our base-case scenario remains that the threat of tariffs is a negotiating tactic and that there is a low probability of their implementation. That being said, we recognize that there are now a myriad of possible outcomes stemming from the next U.S. administration’s trade policy.”
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Touting “ongoing momentum for grid reliability though gas-fired power,” TD Cowen analyst John Mould added Capital Power Corp. (CPX-T) to the firm’s “Best Ideas 2025″ list.
“We view CPX’s ability to build, optimize, and add value to dispatchable assets critical for system reliability as attractive given broad tailwinds for electricity demand,” he said. “We view its low-cost Genesee units as well-positioned to benefit from the potential for growth in large loads (data centres) in Alberta.”
Mr. Mould said his “buy” recommendation for Capital Power shares is “underpinned by a growing need for reliable electricity in its core markets, strong competitive positioning in Alberta’s wholesale power market, and CPX’s development track record.”
“We acknowledge that CPX has been a strong performer in 2024,” he said. “The 59-per-cent year-to-date increase in its share price has outperformed both Canadian IPP peer TransAlta (up 47 per cent) and the S&P/TSX Composite (up 22 per cent). We still view CPX as the best Canadian thermal-weighted IPP for gaining exposure to broader load growth, the need for gas-fired power to support a portion of that growth, and providing high reliability. Our view continues to be driven by the high quality of CPX’s asset base (particularly Genesee in Alberta) and the potential for expansions across its gas-fired fleet. Additional M&A is not included in our estimates; however, CPX’s operational and optimization expertise arguably gives it a comparative advantage, particularly relative to potential financial buyers.”
“Clarity on Alberta’s power market redesign (early 2025) will be an important milestone for further investments in that province. Details regarding potential data centre investments in Alberta are limited, however, we anticipate more clarity regarding this broader opportunity for the province in H1/25. Beyond CPX’s 660 MW of contracted development projects, we anticipate M&A (primarily mid-life, gas-fired assets) will remain a focus.”
Mr. Mould raised his target for the Edmonton-based company’s shares to a Street high of $70 from $61. The current average is $55.11.
“We argue that broad load-growth trends, a focus on dispatchable power, and CPX’s high quality asset base support an expanded valuation multiple,” he said.
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Seeing “tangible signs of life” in potash and noting management commentary is suggesting “recent efforts to streamline the business are gathering momentum,” Raymond James analyst Steve Hansen upgraded Nutrien Ltd. (NTR-N, NTR-T) to “outperform” from “market perform” previously, believing “recent declines in the share price present a more compelling risk-reward at current levels.”
“After several months of ‘bouncing along the bottom’, global potash markets have finally started showing signs of life, with both SE Asia ($295/mt, +$13/mt) and Brazilian ($290/mt, +$7/mt) spot markets recording healthy gains off their lows in recent weeks,” he said. “Importantly, solid fundamentals appear to be backing these moves, with buyers reportedly stepping in due to a confluence of factors that include: 1) a strong surge in palm oil prices stoking SE Asia demand; 2) improved affordability more broadly; and 3) anticipation of solid spring demand. Events further supporting this pattern are recent price increases for Russia-China rail volumes (Dec: +$12/mt m/m) and domestic price increases by Chinese producer QSL (Dec: +$14/mt). While it’s admittedly difficult to get ‘excited’ about sub-$300/mt spot prices, we believe this recent momentum confirms the floor is now in, with upside likely to follow as the busy spring season draws closer.”
“Earlier this week, we sat down with NTR management where the team signaled clear momentum in its plan to streamline/optimize its global footprint (per Investor Day), highlighting: 1) it is ‘ahead of schedule’ on extracting $200-million in SG&A savings (with potential upside emerging); 2) it has secured multiple early wins in driving working capital efficiency; 3) Brazilian Retail has stabilized after a series of operational improvements (negative margin drag now behind us); 4) the NA Retail M&A pipeline has been filling back up (⇑ activity expected in FY25); 5) potash automation investments are exceeding IRR target, helping stave off cost inflation (cash cost: sub-$60/mt); 6) it has uncovered further opportunity to trim FY25 sustaining capital; & 7) it is closely evaluating all unproductive assets (beyond already identified). Taken together, these actions are expected to cement NTR’s ability to generate generous FCF at all points of the cycle.”
Mr. Hansen increased his target for Nutrien’s U.S.-listed shares to US$60 from US$58. The average on the Street is US$57.30.
“While NTR shares are currently trading near the mid-point of their historic range (7.0 times FY25 EBITDA), we believe the multi-year erosion in forward estimates is likely now behind us (anchored by potash prices bottoming & Brazil retail pain fading), leaving potential upside as macro conditions improve and the aforementioned streamlining process gains traction,” he said.
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In other analyst actions:
* ATB Capital Markets’ Amir Arif trimmed his Baytex Energy Corp. (BTE-T) target to $5.20 from $5.50 with an “outperform” rating, while BMO’s Jeremy McCrea lowered his target to $5.50 from $6 with a “market perform” rating. The average is $5.93.
“One of the top plays in Canada is the Clearwater, where Baytex has some of the best well results,” said Mr. McCrea. “Combined with recent encouraging IP rates in the Duvernay and a heavy oil fairway that continues to see more multi-lateral success, there is plenty of potential upside. Although we would like to see higher growth (vs. 1-4 per cent per year), management has been prudent in finding balance between debt repayment and shareholder returns. The 2025 budget is in-line with expectations, with notable improvements in Eagle Ford well efficiency, offset by slight inflationary cost pressures.”
* Seeing “cross-border trade flows in focus” for railway companies, National Bank’s Cameron Doerksen raised his targets for Canadian National Railway Co. (CNR-T, “outperform”) to $181 from $178 and Canadian Pacific Kansas City Ltd. (CP-T, “sector perform”) to $123 from $119. The averages are $174.25 and $94.64, respectively.
“So far in Q4, CN’s volumes as measured by RTMs [revenue ton miles] are down 3.2 per cent year-over-year while CPKC’s are up 1.4 per cent,” he said. “Q4 volumes for both railroads have been impacted by now resolved labor disputes at multiple Canadian ports, and we expect to see more positive volumes in the remaining weeks of the quarter. Market focus has shifted to the potential impact on cross-border Canada-U.S. and U.S.-Mexico volumes from tariff threats. For CPKC, 41 per cent of its revenue is generated from cross-border flows including 17 per cent of revenue from cross-border U.S.-Mexico with much of the future growth opportunity for CPKC related to trade with Mexico. For CN, 32 per cent of its volumes are tied to transborder Canada-U.S. flows. We also note that 23 per cent of CN’s total revenue is from intermodal which skews to international intermodal (55 per cent), a portion of which (35 per cent of Canadian West Coast port container volumes) is volumes offloading in a Canadian port with the end destination in the U.S..”
* Following Tuesday’s post-market earnings release, CIBC’s Stephanie Price raised his Descartes Systems Group Inc. (DSGX-Q, DSG-T) target to US$128 from US$116, keeping an “outperformer” rating. Other changes include: BMO’s Thanos Moschopoulos to US$120 from US$104 with a “market perform” rating, Raymond James’ Steven Li to US$118 from US$96 with a “market perform” rating, Canaccord Genuity’s Robert Young to US$130 from US$110 with a “buy” rating, Scotia’s Kevin Krishnaratne to US$125 from US$120 with a “sector outperform” rating, TD Cowen’s Daniel Chan hiked his target to US$135 from US$115 with a “buy” rating. The average is US120.12.
“As expected, another consistent quarter. Strong one-time License revenue drove a slight top line beat. We remain favourable on the name given what we believe could be a positive setup for accelerating Services organic growth from recent hardware upgrades, global trade uncertainty, and cross-selling. Combined with a favourable M&A environment, we believe Descartes’ momentum can continue,” said Mr. Chan.
* KBW’s Tim Switzer raised his Versabank (VBNK-T) to $28 from $22 with an “outperform” rating. The average is $19.67.