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Msg  69787 of 70166  at  6/1/2021 10:22:15 AM  by

Gammafriend


Morning News Call TD


 

CANADA EDITION

 

TUESDAY, JUNE 1, 2021

 


TOP NEWS
• Bank of Nova Scotia profit beats estimates on provisions, capital markets earnings slip 
Bank of Nova Scotia beat analysts' estimates for second-quarter profit, driven by fewer-than-expected provisions to cover loan losses, although that impact was somewhat offset by a surprise decline in earnings in its global banking and markets division.  

• Pot producer Canopy's loss narrows on cost cuts, higher demand 
Canopy Growth reported a smaller adjusted loss for the fourth quarter as the pot producer benefited from cost-cutting measures and a pandemic-driven jump in demand for cannabis products.

• Canada's Alberta province back in favor with bond investors as oil rallies 
Investors see less risk in Alberta's bonds, brushing aside a recent credit rating downgrade, as surging energy prices boost the outlook for the province's finances and oil sands operators begin to address the sustainable investment trend. 

• OPEC+ seen sticking with supply plan as Iran's oil yet to return 
OPEC+ is likely to stick to the existing pace of gradually easing oil supply curbs at a meeting on Tuesday, three OPEC sources said, as producers balance expectations of a recovery in demand against a possible increase in Iranian supply. 
 
• KKR, CD&R take data analytics firm Cloudera private for $4.7 billion
Private equity firms KKR and Clayton Dubilier & Rice will take Cloudera private for $4.7 billion, the cloud-based data analytics company said. 


BEFORE THE BELL
Futures for Canada's main stock index rose as oil prices gained on optimism over demand recovery, while investors awaited GDP data for cues about the pace of economic recovery. U.S. stock futures traded higher, as investors prepared for a week packed with major economic data releases. European equities rose with commodity shares leading the way. Gold prices dipped. Japanese shares ended slightly lower, on delayed roll out of vaccines. The U.S. dollar slipped.


STOCKS TO WATCH
Results 
• Bank of Nova Scotia: The bank beat analysts' estimates for second-quarter profit, driven by fewer-than-expected provisions to cover loan losses, although that impact was somewhat offset by a surprise decline in earnings in its global banking and markets division. But the lender still fared better than expected, reporting adjusted net income of C$2.48 billion, or C$1.90 a share, in the three months ended April 30, compared with analysts' estimates of C$1.76 a share, based on IBES data from Refinitiv. Scotiabank reported overall net profit of C$2.46 billion, or C$1.88 a share, up from C$1.32 billion, or C$1 a share, a year ago. 

• Canopy Growth Corp: The company reported a smaller adjusted loss for the fourth quarter as the pot producer benefited from cost-cutting measures and a pandemic-driven jump in demand for cannabis products. The company slashed total operating expenses by 73% to C$243 million in the period. Its revenue surged 38% to C$148.4 million as demand rose for weed from customers staying at home during lockdowns. Analysts had expected a figure of C$151.8 million, according to Refinitiv IBES estimate data. Canopy posted an adjusted loss before interest, taxation, depreciation and amortization of C$94 million, compared with C$102 million a year earlier.  

In Other News 
• Centerra Gold: Canada's Centerra Gold on Monday said Kyrgyzstan units Kumtor Gold Co and Kumtor Operating Co have commenced bankruptcy proceedings in a U.S. court following nationalization of the miner's Kumtor gold mine by the former Soviet republic. Centerra said the Chapter 11 filing would have no financial or operational impact on it or any other areas of its business. Centerra has suspended its 2021 production guidance and three-year outlook for Kumtor. 

• Dye & Durham Ltd: The Canadian cloud-based software maker has received a buyout offer from a management-led shareholder group worth about C$3.4 billion, less than a year after its flotation on the Toronto Stock Exchange. The company said it expects C$220 million in annualized pro forma earnings before interest, taxes, depreciation and amortization following recent acquisitions and reflecting its business performance. 

• Noront Resources: Australian mining billionaire Andrew Forrest's Wyloo Metals on Monday said it would develop a "future metals hub" and study battery material production in Canada as it seeks to clinch a takeover of nickel-copper miner Noront Resources. Wyloo's planned unsolicited bid for the remaining shares of the Canadian miner values Noront at C$133 million, or C$0.315 per share. It would also target C$100 million in contract awards to First Nation businesses and develop Noront's flagship Eagle's Nest deposit as a net-zero emissions mine, the company said. 


ANALYSIS
Chasing yield, U.S. private equity firms nudge up risk on insurers 
Private equity firms have spent nearly $40 billion buying U.S. insurance companies in recent years, promising to earn higher returns on the mountains of money that insurers set aside to pay policyholders years or decades from now. The firms are moving some of the money out of traditional low-yield investments such as government bonds into riskier, harder-to-sell assets such as private loans and equity.


ANALYSTS' RECOMMENDATION
• Dundee Precious Metals Inc: CIBC cuts target price to C$12 from C$12.5, reflecting on the company's acquisition of INV Metals which comes with some execution risks. 
 
• Dye & Durham Ltd: CIBC raises target price to C$50.5 from C$47.5, following the announcement that a shareholders' group is interested in taking the company private.
 
• National Bank of Canada: Cormark Securities raises target price to C$109 from C$99, citing the bank's strength across all business lines. 


ECONOMIC EVENTS (All timings in U.S. Eastern Time)
0830 (approx.) GDP qq for Q1: Prior 2.3%
0830 (approx.) GDP qq annualized for Q1: Expected 6.7%; Prior 9.6%
0830 (approx.) GDP Implicit price for Q1: Prior 1.1%
0830 (approx.) GDP yy for Q1: Prior -3.23%
0830 (approx.) GDP mm for Mar: Expected 1.0%; Prior 0.4%
0930 Markit Manufacturing PMI SA for May: Prior 57.2


COMPANIES REPORTING RESULTS
June 1:
Canaccord Genuity Group Inc: Expected Q4 earnings of 62 Canadian cents per share

June 2:
Descartes Systems Group Inc: Expected Q1 earnings of 17 cents per share
Laurentian Bank of Canada: Expected Q2 earnings of 89 Canadian cents per share
Stingray Group Inc: Expected Q4 earnings of 18 Canadian cents per share


CORPORATE EVENTS (All timings in U.S. Eastern Time)
0800 Bank of Nova Scotia: Q2 earnings conference call
0900 Reliq Health Technologies Inc: Q3 earnings conference call
1000 Canopy Growth Corp: Q4 earnings conference call
1000 InPlay Oil Corp: Annual Shareholders Meeting
1000 Park Lawn Corp: Annual Shareholders Meeting
1000 Quipt Home Medical Corp: Q2 earnings conference call
1000 Wesdome Gold Mines Ltd: Annual Shareholders Meeting
1130 Jaguar Mining Inc: Annual Shareholders Meeting
1300 Aptose Biosciences Inc: Annual Shareholders Meeting
1300 Harborside Inc: Q1 earnings conference call
1630 Alaris Equity Partners Income Trust: Annual Shareholders Meeting


EXDIVIDENDS
Great-West Lifeco Inc: Amount C$0.43


(All analysts' estimates are according to I/B/E/S Refinitiv data)


 


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