Inside the Market’s roundup of some of today’s key analyst actions
Advantage Energy Ltd.’s (AAV-T) $316-million agreement with Ovintiv Inc. (OVV-T) to sell its assets in the Wembley area of Alberta represents “a valuation materially above where the market currently values the entire company,” according to TD Cowen analyst Aaron Bilkoski.
“In our view, this transaction provides third-party validation of the embedded value within AAV’s asset portfolio and further supports our positive investment thesis,” he added. “AAV sold Wembley for 6.7 times annualized cash flow, roughly a 50-per-cent premium to the company’s current 2026 estimated EV/DACF [enterprise value to debt-adjusted cash flow] valuation.”
After the bell on Wednesday, Calgary-based Advantage announced the deal, which Mr. Bilkoski said “effectively divested 11 per cent of H1/26 cash flow, 6 per cent of its total production, and 7 per cent of its year-end 2025 reserves for proceeds that equate to 13 per cent of its EV.”
“We model the vast majority of the sale proceeds going to debt reduction; therefore, our 2027 estimated CFPS [cash flow per share] estimate declines by a modest 3 per cent,” he added.
“Debt Cut in Half: This transaction materially reduces the company’s bank debt – now forecast to be $245-million at year-end 2026 estimate (versus $500-million previously). If we assume leverage stays at this level through YE-2027E (0.5 times D/CF), we estimate that all the company’s FCF can be directed towards the NCIB. We estimate Advantage can repurchase 5 per cent of its current shares outstanding in H2/26 and an incremental 10 per cent of its current shares outstanding in 2027, under strip pricing.”
While Advantage’s strategic review concluded in February, Mr. Bilkoski emphasized he continues to see it “actively unlocking value across its portfolio.”
“The Wembley divestiture represents another step toward strengthening the balance sheet and highlighting the value of its quality assets,” he concluded.
Keeping a “buy” rating for the company’s shares, he raised his target by $1 to $15. The average on the Street is $13.95.
“Advantage provides exposure to top-tier Montney assets, emerging Charlie Lake assets, strong FCF generation, and exposure to a unique CCS vehicle through Entropy,” said Mr. Bilkoski.
RBC Dominion Securities analyst Darko Mihelic raised his forecast for National Bank of Canada (NA-T) following strong third-quarter results, however he emphasized “a negative on capital and some question marks on retail.”
“Q3/26 was better than expected across many segments but we tend to view Corporate earnings (maybe even Capital Markets growth rates) as unsustainable and there are some subtle changes worth exploring,” he explained. “NA expects CET 1 benefits from the CWB AIRB conversion to be at the lower end of the range (35-55 basis points) starting in late 2027 (was Q4/26), a negative in our view. Mortgages are growing fast (so is legacy commercial, not CWB) and a refreshed retail strategy TBA. We model NA exceeding 16-per-cent ROE this year, hitting 17-per-cent ROE next year.”
Shares of National Bank dropped 4.2 per cent after it reported adjusted earnings per share of $3.39, topping both Mr. Mihelic’s $3.14 estimate and the consensus projection of $3.21.
“Stronger than expected results were broad-based across most segments, particularly in Corporate, with the exception of U.S. Specialty Finance and International (USSF&I),” he said. “On a consolidated basis, better than anticipated results were primarily driven by higher than expected total revenues of $4.053-billion versus our $3.793-billion expectation, partially offset by higher than anticipated non-interest expense of $2,017 million while we estimated $1.891-billion. Corporate had a core gain of $1-million, better than our estimated core loss of $42 million and consensus core loss of $35-million. Total revenue was $70-million while we expected a $20-million loss. Treasury activity and investment gains continue at elevated levels.
“We update our model mainly for higher core earnings estimates in Capital Markets and Wealth Management, partially offset by lower estimates in USSF&I; we lower Personal and Commercial core earnings estimates in 2027 by a small amount. We primarily model higher revenue estimates partially offset by higher expense estimates across the operating segments except for USSF&I.”
Mr. Mihelic’s core EPS estimates for 2026 rose to $13.28 from $12.97 with his 2027 projection moving to $14.54 from $14.35. He also introduced his 2028 forecast of $16.11.
Keeping a “sector perform” rating for National Bank shares, he increased his target to $224 from $214. The average is $218.50.
Elsewhere, other analysts making target revisions include:
* Desjardins Securities’ Doug Young to $230 from $238 with a “hold” rating.
“While cash EPS and adjusted PTPP earnings were above our estimates and consensus, there was some confusion around the AIRB conversion of the CWB portfolios, mortgage loan growth, and a lower Canadian P&C banking NIM. Otherwise, the integration of CWB is on track, and there was no change to management’s conviction around hitting 17-per-cent-plus ROE in FY27. We increased our estimates but lowered our target,” said Mr. Young.
* Scotia’s Mike Rizvanovic to $243 from $241 with a “sector outperform” rating.
“We viewed NA’s Q3 results favorably, which featured (1) an EPS beat that was broad-based across the bank’s key operating segments; (2) another impressive quarter for market-sensitive businesses (both Financial Markets and Wealth); (3) solid loan volumes that continue to exceed expectations and are tracking well above peer levels; and, (4) strong performance in Canadian P&C Banking that benefited from higher NII, stronger fee-based revenue, and lower PCLs. The outlook for NA remains constructive based on management’s commentary on the Q3 call, with the 17-per-cent ROE target for F2027 reaffirmed. We were surprised by the market’s negative reaction to NA’s results, which we believe was largely a function of concerns around the margin (down more than expected but volumes more than made up for that and drove NII higher), the outsized pace of mortgage growth, and the delay in the capital benefits related to the CWB portfolio transitioning to AIRB. We believe the sell-off was overdone as we continue to have a positive view on the bank’s EPS growth trajectory over the medium-term. Our estimates move up modestly post-quarter, while our Sector Outperform rating is unchanged,” said Mr. Rizvanovic.
* Raymond James’ Stephen Boland to $223 from $226.50 with a “market perform” rating.
“Overall, we retain a favourable view of NA’s fundamentals, supported by resilient credit, strong loan growth and continued CWB synergy realization. That said, achieving 17%+ ROE from current levels will require continued earnings growth and material capital deployment, while market-sensitive businesses are already operating at elevated levels. With NA trading at a premium to peers, we believe the current valuation appropriately reflects the strength of the franchise, leaving the risk-reward balanced. We reiterate our Market Perform rating,” said Mr. Boland.
* TD Cowen’s Mario Mendonca to $226 from $227 with a “hold” rating.
“NA beat estimates on strong capital markets revenue & treasury. CAD banking PTPP was weaker on softer NIM (loan mix and deposit seasonality). ABA earnings were in line, but formations ticked up. Overall PCLs were higher than expected. Capital remains a key strength of NA, with 55-60 basis points of CET1 gains expected by Q4/27. Our HOLD rating reflects relative valuation in the context of unfavorable business mix,” said Mr. Mendonca.
Expecting the commercialization of its “cutting-edge” low Earth orbit (LEO) constellation by 2028, RBC Dominion Securities analyst Drew McReynolds sees Telesat Corp. (TSAT-T) “very well positioned to capitalize on a large and growing B2B LEO TAM [total addresable market] that is benefiting from multiple structural demand drivers including a rapidly growing global defence industry.”
Accordingly, in a client report released Wednesday titled Making the Jump to Lightspeed, he initiated coverage of the Ottawa-based company with an “outperform” rating on Thursday.
“Despite a 50+ year history as a GEO [geostationary] satellite operator, Telesat is currently transitioning to a LEO satellite operator with the commercialization of Telesat Lightspeed set to commence in Q1/28,” he said. “Telesat Lightspeed will be a LEO satellite constellation comprising 225 satellites to form a global mesh network that delivers military and enterprise-grade services to B2B customers including government. We believe Telesat is a cuttingedge LEO constellation purpose-built for mission-critical services and is at the intersection of three structural trends that could drive meaningful growth – sovereignty, defence and space.”
“A large LEO satellite TAM that is not winner takes all. Telesat Lightspeed has been optimally designed to serve the B2B market with management targeting 1 per cent of the estimated 2032 LEO B2B TAM of US$359-billion (up from US$190-billion in 2025). Importantly, the LEO satellite industry should not be winner takes all reflecting orbital, spectrum and landing constraints that prevent exclusivity, sovereignty and security policies supporting government-backed operators, specialized LEO architecture for specific use cases, and the need for multi-vendor redundancies for mission-critical communications.”
Despite his bullish view, Mr. McReynolds emphasized it is important to ackowledge refinancing and capital structure uncertainty lingering around the company.
“With US$1.7-billion in debt maturing December 2026 and 62 per cent of the equity in Telesat Lightspeed distributed to an indirect non-guarantor subsidiary, creditor litigation began in January 2026,” he said. “While refinancing discussions are underway and we see reasonable room for some form of negotiated settlement that would put existing Telesat GEO creditors ‘in-te-money’, Telesat’s risk profile will remain elevated pending resolution.”
Also emphasizing “above-average volatility and above-normal upside versus downside dispersion.” Mr. McReynolds set a target of $95 per share The average is $92.57.
“Given the pre-operational status of Telesat Lightspeed as well as the upcoming Telesat GEO debt refinancing, we expect above-average volatility in the stock and derive a $30 downside scenario and $170 upside scenario with the above-normal dispersion reflecting varying degrees of success in meeting management’s 2032 financial targets and varying litigation/settlement outcomes with Telesat GEO creditors,” he said.
When Groupe Dynamite Inc. (GRGD-T) reports its second-quarter results on Sept. 10, National Bank Financial analyst Vishal Shreedhar expects to see same-store sales growth “normalize against tough compares,” however he emphasized the “two-year stack is strong.”
“We expect sssg to reflect a largely consistent two-year stack of 37.6 per cent,” he said in a note. “Recall, GRGD noted that it was tracking sssg of 9 per cent in the first eight weeks of Q2/F26. We note that Bloomberg data reflects a slight moderation subsequently (was up 48 per cent in the first eight weeks and up 45 per cent in the last five weeks). Our analysis for Canada shows relatively stable sequential sales growth in the quarter, which is lower than the U.S. We anticipate a largely neutral impact to GRGD input costs on a sequential basis from the implementation of tariffs under Section 301. We estimate GRGD to receive a refund of tariffs paid under IEEPA of Cdn$12-15-million (not reflected in adjusted results, and uncertain timing). We expect GRGD to deploy the cash in marketing and/or capital returns to shareholders, among other uses.
“Our review of apparel retailer commentary suggests: (i) a focus on marketing efforts, including real estate expansion in some cases, (ii) investment in product prices (value focus), and (iii) a possible tailwind from refund of tariffs under IEEPA.”
For the quarter, Mr. Shreedhar is current projecting revenue for the Montreal-based clothing retailer, which designs and distributes women’s apparel under the brands Dynamite and Garage, of $390-million, rising from $326-million during the same period a year ago but narrowly below the consensus estimate of $400-million. He sees earnings per share jumping to 80 cents, which is a penny above the Street’s forecast, versus 57 cents in fiscal 2025.
“Our expectation of 40-per-cent EPS growth year-over-year largely reflects double-digit sales growth (positive sssg, e-commerce and net new store openings in the last 12 months), a lower tax rate ($0.02 benefit to EPS), gross margin expansion and SG&A leverage, partly offset by higher D&A, and higher interest expense (on leases),” he explained.
Mr. Shreedhar said he’s maintaining “a favourable disposition” on the company, seeing an investment in it “differentiated by strong financial metrics, with an EBITDA margin and ROIC that are the highest in our coverage universe (F2025 EBITDA margin of 36.5 per cent and ROIC of 70.3 per cent).”
He reaffirmed an “outperform” rating and $91 target for its shares. The average is $89.23.
Ventum Financial analyst Rob Goff says the Calian Group Ltd.’s (CGY-T) second-quarter results, including a 13-per-cent increase in organic growth, “reinforces the case for sustained double-digit growth and a higher valuation.”
“We have consistently maintained that forecasts and prospective valuations offered upside. With Canadian military budgets looking to roughly triple and NATO budgets similarly rising as a percentage of GDP, double-digit organic growth is a realistic, sustainable target,” he said. “With the aggressive growth and greater confidence in its sustainability, we argue that prospective valuations should exceed historic levels.”
Shares of the Ottawa-based mission-critical solutions company, closed down 2.4 per cent on Wednesday following the premarket announcement of the sale of Computex, its Houston-based U.S. commercial IT business acquired in March 2022, to California-based enterprise technology consultancy Trace3 for $43-million in cash and the assumption of liabilities totalling about $17 million.
It also completed its acquisition of Galaxy Broadband for approximately $24-million upfront, plus up to $27.5-million in earnout consideration.
Mr. Goff calls the deal for Computex an “attractive entry and exit – a well-executed round trip.”
“Calian acquired Computex in March 2022 for $38-million, a purchase price equivalent to roughly 5.7 times EBITDA, and is now divesting the business at approximately 7.5 times on the upfront cash proceeds of US$31-million ($43-million),” he explained. “The multiple expansion between entry and exit, combined with revenue growth from $75-million at acquisition to $80-million on a trailing-twelve-month basis, underpins a return on the investment of more than 15-per-cent IRR over a hold period of roughly 4.5 years. Including the cash flows generated during the ownership period alongside the sale proceeds, the transaction represents a significant total gain and reflects disciplined capital allocation from acquisition through exit.
“Funds the offence – proceeds redeployed towards higher margin opportunities in defence. Proceeds go to organic growth and the M&A pipeline in the core verticals where Calian has the strongest competitive position and greatest long-term opportunity. The divestiture also closes out the portfolio review that management initiated in late FY25.”
With the Galaxy acquisition and Computex divestiture, Mr. Goff cut his full-year revenue and EBITDA projections to $902.9-million and $104.8-million, respectively, from $958.9-million and $108.9-million, previously.
“We expect consensus forecasts to decline, as most estimates already include Galaxy but have yet to reflect the Computex divestiture. On an annualized basis, we estimate Computex would reduce revenue/adj. EBITDA by $80-million/$5.7-million, while Galaxy would add $24-million/$4-million,” he added.
Mr. Goff kept a “buy” rating and $106 target for Calian shares. The average on the Street is $103.40.
“Management has consistently highlighted its strong acquisition pipeline, supporting optimism that further deals will be successfully completed given current discussions and the objective of accelerating the pace of acquisitions,” he concluded. “Management indicated with its Q2/26 results that it would consider all sources of capital to best fund acquisitions and that it would prefer to be in a position to act quickly.”
“We are encouraged by management’s clearly articulated strategy of expanding Calian’s scale and capabilities through both organic investment and acquisitions. Initiatives such as the Raytheon partnership and the Canadian Arctic Maritime Security Consortium (CAMSC), alongside the pending Galaxy Broadband acquisition, strengthen Calian’s ability to pursue larger and more complex defence contracts.”
In other analyst actions:
* Raymond James’ Brian MacArthur raised his target for shares of Altius Minerals Corp. (ALS-T) to $69 from $66 with an “outperform” rating after updating his forecasts for higher near-term lithium prices. The average is $59.67.
“Altius has a high-margin, scalable business model with a quality, diversified asset base that gives investors exposure to potash, base metals, lithium, renewables, and premium iron ore,” he said.
* Desjardins Securities’ Bryce Adams hiked his Aya Gold & Silver Inc. (AYA-T) target to $55 from $38 with a “buy” rating.
“In our view, Aya is set up for a strong fall season underscored by the expected economic update for its large-scale Boumadine project (85-per-cent owned, Morocco). We also expect 3Q26 financials could benefit from accelerated sales, after sales lagged production in 2Q,” said Mr. Adams.