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

Seeing Pet Valu Holdings Ltd.’s (PET-T) 2026 guidance as “uninspiring” alongside a “tepid” industry backdrop, National Bank Financial analyst Vishal Shreedhar downgraded his rating for the retailer’s shares to “sector perform” from “outperform” following the release of “light” fourth-quarter 2025 financial results.

“While the pet industry has historically been characterized by stable growth, we believe the current pressured backdrop (tepid consumer and heightened industry competition, etc.) is unfavourable for premium priced retailers (motivates trade down). We downgrade to Sector Perform from Outperform,” he explained. “We view our rating change to be tactical and remain constructive on the industry long term; however, we believe the stock could be range-bound in the near term.”

Shares of the Markham, Ont.-based company plummeted 10.9 per cent on Tuesday after it reported quarterly same-store sales growth of 0.3 per cent, up from a decline of 0.2 per cent a year ago but well below Mr. Shreedhar’s projection of a 1.7-per-cent increase. Revenue of $326-million and earnings before interest, taxes, depreciation and amortization of $75-million also fell short of his expectations ($333-million and $77-million, respectively). Earnings per share of 49 cents was a gain of 4 cents year-over-year but under the analyst’s 52-cent estimate as well as the Street’s forecast of 51 cents.

“PET expects the 2026 industry backdrop to be similar to 2025 (tepid growth and competitive pricing),” said Mr. Shreedhar. “Q4/25 inflation was in line with industry (NBCM calculates down 1.4 per cent), a surprising contrast from PET’s comment of positive inflation in Q3/25. PET adjusted its value positioning through 2025, pressuring margins. Network expansion of 6 per cent year-over-year supported slight market share gains.

“2026 guidance (52-week basis) is: (i) Revenue growth of 2-4 per cent (NBCM is 3 per cent), supported by 40 new store openings, 0-2-per-cent sssg (NBCM is 1 per cent) and higher wholesale penetration; (ii) Flat to slight EBITDA margin expansion, (iii) EPS growth in the mid to high single-digits (NBCM is 7 per cent), and (iv) $20 mln in net capex and $15-million in transformation costs.:

Reducing his EPS estimates to $1.69 from $1.60 for 2026 and $1.89 from $2 for 2027 to reflect “lower sales, lower EBITDA margins and higher interest expense,” Mr. Shreedhar cut his target for Pet Valu shares to $28 from $37. The average target on the Street is $33.67, according to LSEG data.

Elsewhere, others making target revisions include:

* Stifel’s Martin Landry to $32 from $37 with a “buy” rating.

“Pet Valu’s shares were down 11 per cent [Tuesday] as investors were repricing lower growth than expected,” said Mr. Landry. “Promotional intensity increased during Q4/25 which weighed on same-store-sales and gross margins. This dynamic is expected to continue in Q1/26 and led management to introduce a 2026 guidance below expectations. Management claims that Pet Valu is gaining share in the specialty channel, but these gains don’t translate into strong revenue growth as the category is experiencing price deflation in our view. In addition, we believe that the specialty channel may be loosing share to Costco, Dollarama and to other online retailers. This makes for a tricky outlook where Pet Valu’s 2026 revenue growth is expected to range between 2-4 per cent year-over-year, below historical averages and below investors’ growth expectations. We maintain our BUY rating given PET’s valuation, at 13 times forward earnings, is 4 turns lower than the historical average, already reflecting this dynamic, in our view.”

* Desjardins Securities’ Chris Li to $32 from $38 with a “buy” rating.

“Softness in consumer spending (especially for discretionary hardlines) and heightened promo intensity have caused PET to take a more cautious view on sales growth and margin in the foreseeable future. Following the 11-per-cent share price decline, PET now trades at its recent forward P/E trough of 15 times. We believe risk/reward skews to the positive with downside/upside of 10 per cent/27 per cent, but we believe investors will need better SSSG visibility (likely in 2H) to become more constructive. Patience is required,” said Mr. Li.

* Raymond James’ Michael Glen to $31.50 from $40 with an “outperform” rating.

“While we fully acknowledge the result and outlook is disappointing, we continue to see value in the stock and expect competitive intensity will eventually ease. However, investors will need to be patient, and we would not expect any significant shift during 1H26. Our expectation continues to be that Pet Valu is positioned to gain market share, which is supported by multiple initiatives and investments that have been made in the operation. At the forefront of these investments is the recent completion of the multi-year $100 mln supply chain investment. Additionally, we believe there are levers available to the company to engage customers more effectively via the loyalty program (which we believe would be best achieved via mobile app introduction). With that, we remain Outperform rated on the stock, but expect near-term results will see some choppiness,” said Mr. Glen.

* RBC’s Irene Nattel to $33 from $35 with an “outperform” rating.

“While [Tuesday’s] 11-per-cent share price decline was once again caught in broader market crosswinds, investors are clearly disappointed in 2026 guidance, including management commentary around sustained industry pressure until macro headwinds dissipate,” said Ms. Nattel. “Nonetheless, we reiterate our view that the combination of commercial initiatives to enhance relative value proposition/positioning, completion of DC investments in Q3/2025, attractive FCF with resumption of NCIB in 2026, and sector-leading ROIC more than 20 per cent, should help stabilize the earnings profile and help valuation find it footing.”

* TD Cowen’s Michael Van Aelst to $34 from $40 with a “buy” rating.

“Despite a tempered outlook, we still see good value in PET shares. Industry growth has paused, but PET is gaining share, has a strong balance sheet and is seen generating a 7-per-cent FCF yield in 2026, resulting in a 4-per-cent NCIB. Meaningful additional downside seems unlikely, but investors likely need to see SSS and EPS growth move higher before supporting a material share price recovery,” said Mr. Van Aelst.

* Barclays’ Adrienne Yih to $28 from $34 with an “overweight” rating.

“Despite uncertainty in FY26, we reaffirm our belief that its investments will support long-term growth,” she said.

Stifel analyst Daryl Young thinks CAE Inc. (CAE-T) “presents a catalyst rich multi-year investment opportunity as one of the marquee corporate champions under Canada’s new Defence Industrial Strategy.”

Touting a “generational opportunity in defence,” he initiated coverage with a “buy” rating on Wednesday.

“CAE is uniquely positioned to capitalize on the current generational increase in NATO defence budgets given its status as the largest independent, pure-play training organization (i.e. not connected with any aircraft/equipment OEMs),” said Mr. Young. “Independence provides a unique ability for CAE to bridge interoperability challenges between allied nations to facilitate complex multi-domain simulations. This is particularly important given the shifting military threats from counterterrorism, where adversaries wielded highly asymmetric capabilities to “peer threats” that will see the battlefield span all five domains (including cyber). The cost and complexity of training for these environments/ adversaries is necessitating rapid development of virtual battlefields and digital twins, an area where CAE has growing competency. However, air continues to represent the biggest proportion of military training, capturing more than 70 per cent of the spend and is CAE’s clear area of market leadership. We think that this backdrop will position CAE’s defence business to drive high single-digit organic growth well into the 2030s.”

The analyst also thinks the Montreal-based company is “well-positioned for success” with its turnaround, which is focused on margins, free cash flow and return on invested capital, “given the existing business model/strategy is sound.”

“The transformation is more about shifting the company mindset from ‘growth at any cost’ towards a leaner, more capital efficient and returns focused organization,” he explained. “Prepandemic, CAE generated 11-per-cent ROICs but M&A, legacy fixed-price defence contracts and overbuilding of the civil network have seen ROICs fall to the 5-7-per-cent range. Looking forward we see a path to double-digit ROICs through margin enhancement across both the Civil and Defence businesses combined with more disciplined capex and R&D spending. In terms of margins, management has been clear that the Defence segment should be able to sustainably produce 10-per-cent operating income margins through asset optimization, cost-cutting and a sharper approach to contract structuring that balances risk/reward versus padding the backlog. For Civil, the optimization theme is similar, with plans to remove 10 per cent of the FFS network to boost utilization rates, while culling unprofitable training arrangements and grinding the sales mix higher. Combined, we think these initiatives could drive mid-20-per-cent operating margins in Civil.

“To be clear, this will be a multi-year process, with F2027 still a transition year but we expect investors to focus on progress toward management new upcoming medium-term targets to be released in FQ4/26 as the key driver for the stock.”

Mr. Young set a target of $50 for CAE shares, exceeding the average on the Street of $48.60.

“Nearterm, we expect the stock to be driven by the generational inflection in NATO defence budgets (and related backlog growth), combined with improving FCF and ROIC under management’s new business transformation plan. Medium-term, the story will be complimented by a structural recovery in civil aviation training as commercial air travel growth and pilot demographics usurp current transitory headwinds from new aircraft delivery delays. The company is trading at a historically elevated valuation of 13.2 times EBITDA but we think it’s warranted given the defence thematic, record backlogs, and Canadian corporate champion status, which reduces the risk profile,” he added.

Jonathan Goldman of Scotia Capital sees Wajax Corp. (WJX-T) as a “good cost control story,” however he says he’s “waiting for [a] revenue sequel” from the Mississauga-based industrial products and services provider, deeming its fourth-quarter 2025 result to be “neutral” to its investment case.

“2025 was a more consistent year with the company beating/meeting expectations 3/4 quarters,” he said. “Sales growth has been sluggish (up 2 per cent year-over-year), especially Product Support, which was down 1 per cent year-over-year and continues to lag peers FTT (Canada) up 10 per cent and TIH (Equipment Group) up 4 per cent, respectively.”

In a client report, Mr. Goldman says he does not see a reacceleration in 2026, noting Wajax is “lapping tough comps on outsized mining shovels last year (six in 2025 vs. two in an average year).” He also pointed to a “muted” outlook for both its Industrial Products and Engineered Repair Services segments as “capital projects are still on pause with the majority of customer spend being MRO-related.”

“WJX backlog benefited from a subcontract to supply diesel generator sets for the first batch of three River Class Destroyers (RCD) to be delivered to the Royal Canadian Navy,” he said. “We tend to view that award as one-time given the project timeline: while Canada has committed to investing in 15 RCD ships, first delivery is expected by 2030 and final delivery is expected by 2050. Moreover, backlog was down in all other categories.

“That said, the company is controlling what it can control: costs and capital. SG&A rate ex one-timers was 14.0 per cent in 2025, down 60 basis points year-over-year, and at its lowest level since 2020. Inventory ended the year at $548-million, down $126-million from end of last year, and $200 million from peak in March 2024. That supported deleveraging back within target range of 1.5 times to 2 times.”

Keeping a “sector perform” rating for the company’s shares, Mr. Goldman raised his target to $34 from $29. The average is $33.

“WJX shares are up 60 per cent in the last 12 months driven by multiple expansion (NTM [next 12 month] P/E up 35 per cent since Mar-25) and positive earnings revisions (NTM EPS estimates up 25 per cent), supported by lower SG&A,” he noted. “Lower cost base is structural, in our view, and we are ahead of the Street in 2026/2027. But, the bar is higher now and at a certain point, cost runway will run out. Revenue will need to reaccelerate to support earnings growth and durable multiple expansion.

“Shares are trading at 9.2 times P/E on our 2026E/2027E, 15 per cent above the company’s 5-year average of 8 times. On a relative basis, shares are trading at 10-times discount to FTT (historicals 5 times) and 20 times to TIH (historicals 11.5 times). Those are big numbers, but: 1) WJX doesn’t have a compelling commodity (gold/copper) or data center angle; 2) we have previously discussed how the entire sector may be frothy (particularly in TIH’s case); 4) cost-cutting is supporting a large part of the earnings growth and runway is finite; and 5) valuation alone is not a catalyst. Capital allocation could be a catalyst, namely ERS/IP M&A, but we tend to view that more as a 2027 story as new CEO George McClean (effective March 3) gets a lay of the land and leverage could increase near-term due to business seasonality. We raised our valuation multiple to 9.5 times P/E on our equal-weighted 2026E/2027E, which bakes-in both a generous premium to historicals and a premium for capital optionality.”

Elsewhere, other revisions include:

* TD Cowen’s Patrick Sullivan to $34 from $28 with a “hold” rating.

“We characterized WJX’s results as broadly in line; however, shares rallied 7 per cent. We acknowledge WJX has made great strides in resetting its cost base and de-levering, but think market exuberance around nation-building projects is getting ahead of real revenue expectations which we see as muted medium-term,” said Mr. Sullivan.

* BMO’s Devin Dodge to $34 from $40 with a “market perform” rating.

“Demand from the mining and energy sectors remains strong while emerging opportunities tied to nation building projects and increased defence spending are encouraging for the medium- to long-term prospects of the business. However, the outlook for WJX’s other key end-markets remains challenging which is likely to mute top- and bottom-line growth potential in the near term. Valuation is undemanding but a re-rating catalyst isn’t clear to us,” said Mr. Dodge.

TD Cowen analyst Jonathan Kelcher expects European Residential REIT’s (ERE.UN-T) take-private agreement with Canadian Apartment Properties REIT (CAR.UN-T) to be successful, seeing the “pricing as fair both entities” and leading him to move his rating to “sell” from “hold” previously.

The deal was announced after the bell on Monday with CAP REIT acquiring all outstanding shares it does not own (approximately 35 per cent) at an all-cash cost of $1.19 each. The transaction values Toronto-based ERES at approximately $441-million, including debt

“Since announcing plans in November 2024 to dispose of all or substantially all of its assets, ERES has sold all but six properties and returned €1.90/unit (CAD$2.96) through special distributions,” Mr. Kelcher said. “Together with the $1.19 transaction price, the total $4.15/unit represents a 32-per-cent total return to the closing price on November 6, 2024 (prior to announcement).”

“The transaction price represents a 17-per-cent discount to IFRS and our estimated NAV. It provides ERES unitholders with immediate value as opposed to a potentially lengthy process to sell the remaining assets in the portfolio (as well as wind up

costs and contingent liability risks). We note that the $1.19/unit represents a 5-per-cent premium to Monday’s closing price of $1.13/unit.”

The analyst called the deal “not an overly material transaction” for CAP REIT with the purchase price adding approximately 1 per cent to its asset base.

“We expect CAPREIT to realized value by selling the remaining Netherland assets at close to IFRS value over time,” said Mr. Kelcher. “Taking ERES private will allow CAPREIT to proceed with asset sales at its own pace while eliminating the costs associated with maintaining ERES as a public listing.”

He moved his target for ERES units to $1.19 from $1.25 to reflect the deal. The average on the Street is $1.15.

Elsewhere, Desjardins Securities’ Kyle Stanley moved his rating to “tender” from “hold” with a $1.90 target, down from $1.20.

“While the offer price implies a (1) approximately 5.1-per-cent cap rate on in-place NOI (89.3% occupancy at 4Q25); (2) a mid- to high-5-per-cent cap rate on a stabilized basis; and (3) EUR304,000/door, which is above ERE’s 4Q25 IFRS cap rate of 4.84 per cent and 15 per cent below its IFRS value/suite of EUR359,000, we believe the value is fair given the potential outstanding tax liability as part of the Dutch tax audit and the wind-up costs that are being assumed by CAR. In the end, this concludes a lengthy process and will return capital to investors to be re-allocated,” said Mr. Stanley.

In a client note titled Like taking candy from a baby, Desjardins Securities analyst Lorne Kalmar said he’s now projecting funds from operations per unit growth for Plaza Retail REIT (PLZ.UN-T) of 7 per cent in 2026 and 4 per cent in 7 per cent, sitting at the upper end of levels of its comparable peers and emphasizing the expansion is not “appropriately reflected” in its current valuation.

“We expect solid operating fundamentals to be positively augmented by PLZ’s development and acquisition programs,” he added.

After the bell on Monday, the Fredericton-based REIT reported largely in-line fourth-quarter 2025 financial results, including a 4-per-cent gain in FFOPU year-over-year and same-property net operating income, adjusted for the bankruptcy of Toys “R” Us, of 2.9 per cent.

https://www.newswire.ca/news-releases/plaza-retail-reit-announces-2025-results-832372572.html

“4Q was impacted by higher snow removal and repair costs, as well as the Toys “R” Us insolvency,” the analyst said. “PLZ expects to backfill the former Toys space by year-end. In 2026, management anticipates achieving 2–2.5-per-cent SP NOI growth (we are modelling 2.0 per cent). Same-asset occupancy and occupancy including non-consolidated investments

declined 40 basis points and 30 basis points quarter-over-quarter to 97.1 per cent (10 basis points year-over-year) and 97.6 per cent (flat year-over-year), respectively. There is an active lease pending that will increase committed occupancy to 98 per cent.”

Maintaining a “buy” rating for Plaza units, Mr. Kalmar increased his target to $5, matching the average on the Street, from $4.75.

Elsewhere, RBC’s Pammi Bir increased his target to $4.75 from $4.50 with a “sector perform” rating.

“Q4 results were a little short of our call, partly from a hiccup in bad debts. That said, we see PLZ as well-equipped to navigate broader macro turbulence. Supported by resilient demand, we expect occupancy in its defensive essential needs and value-focused retail portfolio to remain resilient, with stronger organic growth taking shape in 2026. As well, its ongoing capital recycling and development programs are moving portfolio quality up the curve and driving incremental earnings and NAV upside. Net-net, valuation seems well-supported,” said Mr. Bir.

National Bank Financial analyst Ahmed Abdullah sees “a multi-catalyst setup” for Blue Ant Media Corp. (BAMI-T) “where balance sheet strength enables M&A, M&A drives earnings inflection, and earnings growth supports multiple expansion.”

In a client report released Wednesday titled Lights, Camera, Re-Rate: A Roll-Up Story Takes the Stage, he initiated coverage of the Vancouver-based television producer-turned global content distributor, , which went public last year, with an “outperform” rating, emphasizing M&A activity is “a core re-rate lever for the story, backed by a clean balance sheet”

“We view the re-rate pathway as: balance sheet flexibility fuels M&A, M&A unlocks an earnings inflection, and that earnings momentum underpins multiple expansion,” explained Mr. Abdullah. “Early execution is encouraging following the reverse takeover (RTO) that took Blue Ant public on Aug. 1, 2025. The company demonstrated early traction as it acquired MagellanTV (Oct. 2025, US$12-million purchase) and Thunderbird Entertainment (Jan. 2026, $89-million purchase). BAMI aims to expand production scale and increase its owned IP library (now more than 9,000 hours) to drive its content monetization IP strategy via licensing, subscriptions and advertising. We believe the playbook is repeatable as Blue Ant sits with a proforma net cash position and key shareholder support.”

The analyst also pointed to the importance of “cornerstone” support from Fairfax Financial Holdings Ltd (FFH-T), which he thinks “strengthens execution and downside protection.”

“Fairfax’s long-term backing is a key part of our thesis, lowering financing and execution risk as BAMI scales through M&A,” he added. “Its support around the RTO included balance-sheet protection, an unconditional guarantee that enabled monetization of a $13.6-million vendor take-back note, the $34.7-million value assurance payment tied to the retained production businesses, and a commitment to backstop a potential equity financing in the year post RTO (up to $20 million).

“The Global Channels & Streaming segment adds a scalable, recurring component. Blue Ant monetizes its owned channels through subscriptions, advertising and licensing. Incremental FAST distribution expansion carries limited marginal cost, supporting attractive operating leverage as scale builds. This strategy is supported by a structural tailwind as viewing time continues to shift from linear TV to streaming, and ad budgets follow audiences toward connected TV and ad-supported platforms. As connected TV monetization expands and digital advertising conditions improve, we expect this segment to contribute more consistently to growth and reinforce the rerate narrative beyond production alone.”

Viewing a May 1 lock-up expiry as “a near-term technical overhang on shares,” the analyst, who is the first to initiate coverage, set a target of $11 for Blue Ant shares, pointing to an estimated total return of 69.5 per cent.

“Following the RTO, 19.9 million subordinate voting shares were subject to staged lock-ups, with 50 per cent released on Feb. 1, 2026 and the remaining 50-per-cent scheduled for release on May 1, 2026,” he said. “While improving liquidity is constructive longer term, the May 1 unlock may weigh on shares near term as additional stock becomes tradeable and the shareholder base potentially rotates.”

“Blue Ant currently trades at approximately 3.0 times PF2026E EV/EBITDA and 2.8 times F2027E (a 50-per-cent discount to Canadian peers). We believe this valuation overly discounts execution risk relative to the company’s improved pro forma scale ($500-million PF revenue), diversified revenue streams and strengthened balance sheet.”

In other analyst actions:

* Stifel’s Ian Gillies reduced his target for AtkinsRéalis Group Inc. (ATRL-T) to $113 from $121 with a “buy” rating. The average is $120.38.

“We have updated our ATRL model to reflect the new ‘All Other Segments,” 2026E guidance and updated 2025-2027E guidance. Our 2026E and 2027E model updates are largely negative revisions resulting from: (1) lower Nuclear EBIT margin and (2) higher LSTK losses in 2026E. As we think about the path for the stock in 2026E, we ultimately believe it will be driven by (1) M&A and (2) CANDU technology being selected for potential new reactors. Larger M&A and CANDU technology selection seem more like 2H26E events, which could lead to the stock being sideways for a brief period of time. Potential downside risks could emerge from weaker-than-expected ES organic growth. Taking a 12-month view, we remain constructive as we believe their previously mentioned positive catalysts more-than-offset near-term risks,” said Mr. Gillies.

* BMO’s Étienne Ricard reduced his Goeasy Ltd. (GSY-T) target to $170, below the $182.93 average, from $225 with an “outperform” rating.

“Heading into Q4/25 reporting, our attention remains focused on goeasy’s delinquency trends. Interestingly, peer and industry data offer mixed readthroughs, which likely suggests another sequential build to GSY’s allowance rate. That being said, with the stock pricing in a material increase to credit losses (200+bps above our base case, in our view), we believe significant pessimism is reflected in the stock,” said Mr. Ricard.

* In a client note titled Simplifying the story, one deal at a time, RBC’s Pammi Bir raised his NorthWest Healthcare Properties REIT (NWH.UN-T) target to $6 from $5.50, keeping a “sector perform” rating, following the release of in-line fourth-quarter 2025 results. The average target is $6.25.

“NWH continues to make encouraging strategic progress,” said Mr. Bir. “While our earnings estimates are dialed back, the process of simplifying the business took another step forward with the sale of a substantial portion of its European portfolio. As capital is redeployed into North America, we expect its narrower geographic exposure, reduced leverage, and focus on defensive healthcare real estate to expand its institutional investor draw. In the meantime, with work to do on addressing Healthscope (HSO) exposure, valuation seems about right.”

* RBC’s Michael Harvey increased his Paramount Resources Ltd. (POU-T) to $30 from $26 with a “sector perform” rating. Other changes include: BMO’s Jeremy McCrea to $32 from $24 with an “outperform” rating, ATB Cormark Capital Markets’ Patrick O’Rourke to $33 from $28 with an “outperform” rating, Raymond James’ Luke Davis to $31 from $29 with an “outperform” rating and National Bank’s Dan Payne to $32.50 from $30 with a “sector perform” rating. The average is $28.

“POU reported a strong quarter with increased outlook, paired with meaningful reserves growth as a portion of Sinclair was included within the probable category,” said Mr. Harvey. “Rates at Willesden continue to be favourable, with POU (as supported by public data) highlighting shallowing declines out of the Duvernay. We shift our PT to $30 on the back of strong execution and the potential for further multiple expansion.”

* Ventum Capital Markets’ Rob Goff lowered his target for Toronto-based fintech company Propel Holdings Inc. (PRL-T) to $30 from $40, keeping a “buy” rating. Other changes include: ATB Cormark Capital Markets’ Jeff Fenwick to $27 from $38 with an “outperform” rating, Raymond James’ Stephen Boland to $32 from $45 with an “outperform” rating. and Stifel’s Suthan Sukumar to $32 from $38 with a “buy” rating. The average is $33.33

“Q4/25 results were significantly below our forecasts and the consensus,” said Mr. Goff. “A confluence of within-quarter trending, purging of Q3/25 loans, and higher development costs contributed to the shortfall. Management indicated that improving trends seen in December have continued. Q1/26 is expected to report significantly improved performance.

“We look for Q1/26 results to demonstrate significantly improved financials, setting a clear path for a return to year-over-year growth across all financial measures beginning with Q2/26 results. We look for new funding commitments and distribution partners to set a positive backdrop.”

* Raymond James’ Steven Li reduced his VerticalScope Holdings Inc. (FORA-T) target to $5, below the $5.25 average, from $7.50 with an “outperform” rating.

“Light Q4 as FORA continues to see reduced traffic from search engines (given AI) and that traffic is not making its way to FORA’s forums and websites to be monetized,” said Mr. Li.