The wise investor | November winners and losers

Every Sunday, we shine the spotlight on elements of financial and stock market news that may be useful to investors, but which might have gone under the radar




The Montreal biopharmaceutical company Theratechnologies is the big winner of November in Quebec inc. on the Toronto Stock Exchange.

The action of Theratechnologies appreciated by 65% ​​during the month. The titles of Nuvei (+44%), Aya (+ 33%), Reitmans (+ 33%), Lightspeed (+26%), Stingray (+25%) and Gildan (+25%) also had a strong month.

In contrast, the title ofAlithya is the big Quebec loser in Toronto with a decline of 22% in November. D-Box (- 15%), Supremex (- 14%), NanoXplore (- 14%), VAT (- 12%), Goodfood Market (- 11%) and BRP (- 11%) also went through a difficult month on the stock market.

The decline of more than 20% in CAE This fall is an opportunity to seize, according to Scotia analyst Konark Gupta. He literally suggests “backing up the truck” to fill it with actions from the Montreal airline pilot training specialist. In his opinion, the assessment makes no sense. “The market assigns zero value to the defense sector while undervaluing the civilian sector,” he maintains in a note sent to his clients on Thursday.

He says the stock has notably declined due to a two to four quarter delay in restoring defense sector margins and, more recently, due to concerns about demand and margins in the civil sector at the light of problems related to a motor Pratt & Whitney. CAE suffers, according to him, from not having a direct comparable, the closest competitors being Boeing And Lockheed Martin.

Tecsys gained a new follower at the start of the week and continues to be a hit on Bay Street. Analyst Amr Ezzat at Echelon has just launched his coverage of the Montreal-based provider of supply chain management software by recommending the stock to buy. The dynamics surrounding sales and profits are underestimated, he says. He sets his 12-month target at $45, the equivalent of a return of nearly 50% from the current price. There are now five analysts following Tecsys and all suggest buying.

An analyst is surprised by the holiday promotions offered by ECB, Rogers And Telus. “What we are seeing at the moment must clearly be categorized as a price war,” underlines Vince Valentini, of TD, in a note published Tuesday.

“I find it hard to understand why carriers are so aggressive with their monthly plans. They must perceive signals that profitability may still be possible at these prices. » From a financial point of view, he says he hopes that the behavior observed will be short-lived. He notes that various in-store and online promotions over the Black Friday weekend revealed many “aggressive” discounts.

“As if $34 per month plans for reasonably large data volumes weren’t enough, we’re now seeing all three major companion brands (Koodo, Fido and Virgin) offering plans below $30 per month. Koodo notably offered $29 per month permanently, while Fido and Virgin went down to $24 and $25 for 10 months. »

THE CN lost the support of Deutsche Bank earlier this week. Analyst Amit Mehrotra withdrew his buy recommendation on the stock of the Montreal rail carrier as well as the one he had on the stock of CP.

Cogeco Communications paid 190 million to acquire 99 spectrum licenses during the 3800 MHz band auction which lasted from October 24 to November 24. The Quebec company is thus taking another step towards its entry into the country’s wireless market. A wireless deployment by Cogeco requires a commercial agreement with a major operator following negotiations or an arbitration process.

If Cogeco spent significantly the amount that analysts anticipated, Quebecor spent much less than expected. Videotron paid 299 million while National Bank Financial, for example, expected to see Videotron spend 770 million. BCE paid 518 million, Rogers 475 million and Telus 620 million. Observers thought operators could spend more.

Disciplined, operators exit the auction with a marginal increase in their debt level in a context where the cost of capital is higher.

Quebec titles of Tecsys And OpSens hit a 52-week high this week on the Toronto Stock Exchange.

On the other hand, those of BRP, Lion, Goodfood Market, Saputo, Metro, GDI, Supremex, NanoXplore, Band VAT And Alithya all slipped this week to a 52-week low.


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