2023-08-01 22:42:44
The TMX Group, which owns the Montreal Stock Exchange and the Toronto Stock Exchange, among others, has accustomed investors to a profile of revenue growth and consistency in operations. (Photo: Getty Images)
What to do with TMX Group, Aecon and Harley-Davidson securities? Here are some recommendations from analysts likely to move prices soon. Note: the author may have a totally different opinion from that expressed.
TMX Group (X, $29.30): Revenue Growth and Constancy in Operations Are Still Here
The stock market operator, which owns the Montreal Stock Exchange and the Toronto Stock Exchange, among others, has accustomed investors to a profile of revenue growth and consistency in operations, and the 2nd quarter of 2023 was no different, explains Étienne Ricard. , an analyst at BMO Capital Markets.
This trend continued in its fastest growing businesses such as the UK energy trading platform Trayport, the Montreal Exchange and the TSX Trust Company, as well as in the development of TMX Datalinx.
The analyst maintains its performance recommendation equal to the sector given that the gap in its market valuation with its competitors on a global scale has closed significantly. Its target price is $32.
After 18 months of relatively reduced activity, the analyst now sees a good opportunity for improvement in terms of capital calls given the improvement in the markets, with the S&P/TSX index up 5% so far. day this year.
Among the interesting news, the analyst notes that at the Montreal Stock Exchange everything is in place for the adoption of the new benchmark security for short-term interest rates, the CRA, which will replace the BAX. This is an important transition given that derivatives on short-term interest rates represent between 15% and 20% of the total volume of the Montreal Exchange, indicates the analyst. CRA will have completely replaced BAX as of Q3 2024, according to management.
The analyst also believes that the firm enjoys very good financial flexibility thanks to a multiple of 1.9 times its net debt on its earnings before interest, taxes and amortization (EBITDA).
Aecon (ARE, $10.97): Problems with pre-existing contracts may only be temporary, says Desjardins analyst
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