Good morning
See the new Capital Ideas Digest for eight reasons why Lucara Diamond is a gem among peers. The stock has defensive characteristics with a nearly 5% dividend yield.
CANADIAN ANALYSTS’ CALLS
INITIATIONS
Edward Jones starts coverage with a “buy” rating.
RBC boosts the price target to $80 (Canadian) from $78, which gives the shares a projected potential return of 32%, and maintains an “outperform” after the company beat earnings estimates.
upgraded to “buy” at Deutsche Bank with a target of $23.
upgraded to “overweight” at Barclays. Vermillion (TSX:VET) raised to “outperform” at Credit Suisse with a target of $65.
upgraded to “buy” at Desjardins with a target of $11.
Barclays is lifting the target to $59 from $55 to reflect the company’s assets and strong free cash flow.
U.S. ANALYSTS’ CALLS
INITIATIONS
This mouthful of a company is getting its target lifted by RBC to $16 (U.S.) from $11, implying 21% upside, and the analyst maintains an “outperform” rating.
Stifel Nicolaus boosts the target to $406 from $345.
JP Morgan raises target price to $80 from $75 on a belief the company has repositioned itself as a more durable investment opportunity that can provide double digit oil growth.
Barclays raises target price to $148 from $145 reflecting the company’s strong and improving free cash flow yield, solid debt-adjusted production growth and improving return on capital employed.
Cowen & Company raises target price to $138 from $111, expecting improvement in the company’s revenue growth and margin outlook driven by acquisition of Avigilon (remember them) and by greater growth in software and services revenue.
Morgan Stanley raises target price to $127 from $123, after the company reported better-than-expected secondquarter results.
Barclays raises rating to “overweight” on a belief the company’s fundamentals are starting to turn around now and there is a compelling path for the company to grow earnings and revenue at a healthy growth rate.
STOCKS THAT MAY MOVE
The consolidation game resumes in the cannabis sector as Canopy Growth (TSX:WEED) looks for a retail presence by buying this owner of Tokyo Smoke retail shops. The deal is estimated to be worth about $350 million in stock. Hiku had been planning to buy WeedMD but that deal has now been terminated with WeedMD getting a $10 million termination fee.
is buying Garaventa Lift for $98 million. Garaventa manufactures a wide variety of wheelchair lifts for persons with disabilities. Savaria has been a big winner since Peter Hodson of 5i Research recommended it in our Digest nearly two years ago, with the the stock more than doubling before a pullback.
has sold or has a contract to sell four ofce properties in B.C., Alberta and Manitoba for more than $186 million, with the REIT seeing a net gain of more than $12 million.
is going to spend $350 million to upgrade its Ontario operations.
has signed a preliminary oftake deal with Beijing Easpring.
beat analyst estimates with its quarterly revenue. Eldorado Gold (TSX:ELD) has appointed Philip Yee as executive vicepresident and CFO.
has signed a joint venture deal with a company out of China to open as many as 1,500 stores in that country over the next 10 years..
has increased its ofer for Sky of the U.K. to $32.5 billion, topping a previous ofer from Comcast. This is part of a larger battle between Comcast and Disney, which are both trying to buy most of Fox, including Sky, for about $70 billion.
is planning to restructure into three separate business units.
With files from The Globe and Mail, Reuters and Bloomberg News.
MARKETS
TSX and U.S. equity futures are poised for a sharply lower open as the White House is now threatening 10% tarifs on a further $200 billion worth of Chinese goods, to which China, naturally, is planning to retaliate.
The TSX Composite Index on Tuesday again closed at a record high.
European stock indices are down and, overnight in Asia, the Shanghai Composite Index fell 1.8%, Hong Kong’s Hang Seng ended of 1.3%, while the Nikkei was down 1.2%.
The Bank of Canada is expected to raise its key interest rate today to 1.5%. After the announcement, Governor Stephen Poloz will hold a news conference and enjoy the sound of his own voice.
U.S. wholesale prices in June rose 3.4% on an annual basis, the fastest pace since 2011.
CURRENCIES
The Canadian dollar is drifting lower at $76.14 U.S.
Bitcoin is up 1.2% to $6,377, according to CoinDesk.
COMMODITIES WHAT WE’RE READING
West Texas Intermediate is down 1% amid the renewed trade tensions hitting $73.31 a barrel.
Copper is lower by about 3% to a one-year low.
Gold is pulling back a bit to $1,253.30 an ounce.
WHAT WE’RE READING
Behind the debt binge that threatens markets. Excellent article with great charts by Bloomberg News.
DAILY UPDATE
See our newest CEO interview with the co-head of Planet 13 (CSE:PLTH), which is building a huge cannabis entertainment complex in Las Vegas, with plans to expand the concept across the U.S.
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