Inside the Market’s roundup of some of today’s key analyst actions

Desjardins Securities analyst Lorne Kalmar downgraded Choice Properties Real Estate Investment Trust (CHP-UN-T) to “hold” from “buy”, citing valuation concerns. His price target remains at C$16.

“Year-to-date, CHP has generated a total return of 13.4%, one of the highest returns among its large-cap peers. As a result, it now trades at just a 4% discount to net asset value and 13.6x forward 12 months funds from operations (long term average 13.2x). The discount to NAV represents the second narrowest in our coverage (2% discount for CRT), and CHP is the lone large-cap REIT trading at a premium FFO multiple vs its long term average,” Mr. Kalmar said in a note to clients.

Mr. Kalmar also cited an expected shift in market sentiment for the downgrade, whereby investors will be seeking less defensive names in the stock market.

“We are of the view that Canada and the US will finalize a trade deal over the balance of the year, and we are cautiously optimistic that the federal government will successfully prioritize economic growth. In an environment where the economic growth outlook is improving, we expect investors to rotate out of defensive names in favour of those with a higher risk/reward value proposition.”

However, should investors have to remain on the defensive, “we believe CHP will continue to serve as a safe haven in the REIT space,” he added.

He termed the REIT’s second quarter results last week as “solid.”

Elsewhere, RBC raised its price target on Choice Properties by C$1 to C$16 and reiterated a “sector perform” rating.

“Post an in-line Q2, we believe CHP is well-positioned to navigate a choppy macro setup. Supported by its defensive grocery-anchored retail portfolio and the significant mark-to-market opportunity on in-place industrial rents, we expect organic growth to continue printing at a healthy clip. As well, its development pipeline provides a window into a steady source of earnings and NAV upside. In short, we see good support for its premium relative valuation,” said RBC analyst Pammi Bir.

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Citi has substantially raised its price target on Bombardier Inc. (BBD-B-T), going from C$109 to C$195, believing that the business jet company has little exposure to new tariffs.

Bombardier’s jets are USMCA compliant, “which provides some comfort on that company’s tariff risks,” said Citi analyst Andre Mazini in a note to clients. However, he noted it is unclear whether Bombardier’s imports of spare parts could be subject to any tariffs.

“With the company appearing to be in the clear regarding US tariff risks, Bombardier’s potentially greater penetration of the global surveillance/reconnaissance market could continue to support the stock’s rerating. Continued EBITDA growth and deleveraging could open Bombardier’s shares to a wider array of global investors,” the Citi analyst said.

He maintains a “buy” rating.

Mr. Mazini said the large increase in his target price “entails (A) shifting the valuation reference period from 2025 to 2026 – now in-line with Embraer and (B) increasing the target multiple from 9.25x to 14x. The latter reflects a significant (75%) premium to the stock’s pre-pandemic historical average but is also more in-line with small/mid-cap aerospace OEMs [original equipment manufacturers].”

“Citi sees this revised level as reasonable, considering (A) Bombardier’s earnings quality and balance sheet are now much better than they used to be, and (B) the company might be in the best of both worlds – with USMCA compliance potentially meaning unhindered sales to US customers … along with what we would characterize as significant upside in the international surveillance/reconnaissance markets,” he added.

BMO Fadi Chamoun also raised his price target on Bombardier, going from C$150 from C$185, and reiterated an “outperform” rating.

“Business jet cycle fundamentals remain robust, and BBD has emerged as a winner from rising defense spending. We expect revenue growth in coming years to be led by segments with above average margins, ROIC and modest capital intensity. This should lead to higher cash conversion and lower financial leverage, underpinning further expansion in valuation,” Mr. Chamoun said.

He added that while reducing debt remains a top priority at the company, he suspects that Bombardier “will have the bandwidth within its free cash flow to include shareholders’ distributions within its capital allocation framework as early as 2026.”

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Mr. Chamoun of BMO also raised his price target on CAE Inc. (CAE-T), moving to C$50 from C$40, while reiterating an “outperform” rating.

Long time CEO Marc Parent will leave his position next month, with Matthew Bromberg becoming the new president and CEO and Calin Rovinescu becoming executive chairman.

“Amid favourable demand conditions for Civil Aviation and Defense, we anticipate the leadership transition to bring greater emphasis to key value creation drivers,” said Mr. Chamoun. Among them: an improved cost structure, better operational execution, a focus on core competencies, and a reduction in financial leverage.

“We believe the combination of a supportive macro and CAE’s idiosyncratic opportunities has the potential to double earnings per share over the next five years, while expanding free cash flow conversion and ROIC. With valuation generally below aerospace & defense peers, we believe the risk-reward is favourable even after the share appreciation in recent months,” said Mr. Chamoun.

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National Bank Financial analyst Richard Tse has raised his price target on Shopify Inc. (SHOP-Q, SHOP-T) to US$140 from US$120 while reiterating an “outperform” rating, citing higher confidence in “the macro picture” as it pertains to the company.

He predicts the company’s revenues this year will be up 22.2% from 2024, with slightly improved margins. For the second quarter, he expects results to come in largely in line with the Street consensus.

“Looking ahead, we continue to believe that Shopify has several meaningful growth levers at its disposal,” Mr. Tse said in a note to clients. “One of those drivers is increasing large merchant / enterprise momentum. On that front, our checks suggest that in addition to continued momentum, Shopify is also expanding (surprisingly) into new vertical markets likely supported by its expanding B2B capabilities. We also see take rate upside as Shopify remains in the early innings of scaling its Merchant Solutions (MS). A big part of this is Payments where Shopify has expanded from 23 to 39 countries in 2025; for perspective, Shopify operates in ~175 countries. Beyond that, we see expanding channels like a potential Shop Pay partnership with OpenAI and Shopify powering purchase transactions, which could drive upwards of $500 mln in net revenue on a future run-rate basis relative to our FY25 estimates. Finally, the most notable option broad driver of growth and innovation for Shopify is from AI – its application both internally and for its merchants. In our view, this is by far the biggest potential driver of profitability for Shopify care of operating leverage,” the analyst said.

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National Bank’s Richard Tse also raised his price target on Telus Digital (CDA) Inc. (TIXT-N, TIXT-T), US$4 from US$3.50, but downgraded his rating to “sector perform” from “outperform”.

He noted that shares had risen about 50% since he upgraded the stock in early May.

Telus made a non-binding indication of interest (IOI) to acquire all remaining shares of Telus Digital for US$3.40/share in June. Telus currently owns 57% of all outstanding shares with 87% voting power.

He said there are growing expectations for a potential takeout offer above the initial IOI of US$3.40. “With shares currently trading around US$4.00 there is likely limited upside from these levels, thus our rating downgrade,” he said.

“The potential transaction would value TELUS Digital at ~ US$2.3 bln in enterprise value and represent a valuation of ~5.1x EV/EBITDAon our FY25E, which we believe is reasonable given peers Concentrix and Teleperformance relative valuations of 5.3x and 4.5x, respectively, at the time of the IOI. However, with TELUS Digital currently trading at closer to US$4.00, implying an EV/EBITDA valuation of 5.4x, it’s not unreasonable to think TELUS could sweeten its offer,“ the analyst said.

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RBC analyst Irene Nattel raised her price targets on Canadian grocers, believing their defensive nature should continue to be appealing to investors, while tariffs are unlikely to have any major impact.

The price target changes were:

George Weston Ltd (WN-T): Target price to C$316 from C$284

Loblaw Companies Ltd (L-T): Target price to C$267 from C$234

Metro Inc (MRU-T): Target price to C$112 from C$98

“Our view on the sector remains ‘stronger for longer’, with the expectation that secular winners continue trading at the high-end of long-term ranges as investors continue to pay a premium for sustainable, defensive, ratable growth,” Ms. Nattel said in a note.

“Accordingly, we are raising our target multiples on Loblaw and Metro by one turn to 12x EBITDA and continue to favour Loblaw for its store base that skews to discount, its exposure to the drug retail segment, its industry-leading private label program and penetration, and the depth and scale of its loyalty program,” she said.

“On the question of tariffs, we don’t expect any meaningful impact on consumer behaviour or basket inflation to date, other than accelerating consumer demand for Canadian products in recent weeks,” Ms. Nattel added.

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Canaccord Genuity analyst Dalton Baretto initiated coverage on Emerita Resources Corp. (EMO-X) with a “speculative buy” rating and C$1.80 price target. Emerita is an explorer and developer of mineral properties, primarily in the Iberian Pyrite Belt in southern Spain.

“We view EMO as a compelling investment for investors looking for zinc exposure in high-quality jurisdictions through the IBW project (Spain),” Mr. Baretto said in a note. “Iberian Belt West (IBW) is a relatively attractive project in a good jurisdiction, in our view, with solid expected returns and a strong precious metal by-product credit that should lower costs and provide financing options for construction.”

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In other analyst actions:

Arizona Metals Corp (AMC-T): Scotiabank cuts target price to C$2 from C$2.5 and downgrades rating to “sector perform” from “sector outperform”. The bank said “following the latest resource update at the flagship Kay project, we see the risk-reward profile having shifted.”

Tesla Inc (TSLA-Q): BofA Global Research raises price objective to US$341 from US$305