THE ESSENTIAL NEWS
• Canada to fund study on impact of oil sands on health of Indigenous communities. The Canadian government announced Wednesday that it will support an Indigenous-led investigation into the health effects of oil sands development on local communities, following a leak of tailings water from an Imperial Oil site that raised pollution concerns.
• Eli Lilly raises full-year profit forecast as Zepbound quarterly sales exceed $1 billion. Eli Lilly has increased its annual profit forecast, and sales of its popular weight-loss drug, Zepbound, surpassed $1 billion in a single quarter for the first time.
• Burger King’s parent company surpasses revenue estimates due to robust fast-food demand. Restaurant Brands International exceeded Wall Street’s revenue expectations for the second quarter, benefiting from consistent demand at its Tim Hortons and Burger King locations, despite a general slowdown in the U.S. fast-food industry.
• Manulife’s second-quarter profit increases due to strong growth in Asia. Manulife Financial Corp. reported a quarterly profit that exceeded expectations on Wednesday, fueled by a 40% increase in revenue from Asia, a key region for the insurer’s growth strategy.
• Nutrien surpasses quarterly profit estimates and appoints insider Mark Thompson as CFO. Nutrien, a fertilizer company, beat second-quarter profit predictions on Wednesday, driven by increased potash sales in international markets and appointed Mark Thompson as its new chief financial officer.
TRENDS BEFORE OPENING
Futures contracts for the main Canadian stock index are rising, aided by an increase in gold prices and positive business results. US Stock Index Futures remained mostly unchanged as investors adopted a cautious stance ahead of weekly jobless claims data, with large-cap and growth stocks showing mixed results in premarket trading. Comments from Richmond Fed President Thomas Barkin, scheduled to speak later in the day, will be closely monitored for insights into the U.S. central bank’s future decisions. European stocks are declining, with the technology sector leading the downturn. In Japan, stocks faced additional pressure as domestic chip companies mirrored losses on Wall Street overnight, and minutes from the Bank of Japan indicated a “hawkish” sentiment among board members. The US dollar and Treasury bond yields have both pulled back. Oil prices remained stable after two consecutive sessions of increases.
TITLES TO FOLLOW
• Manulife Financial: The company reported quarterly profits that exceeded expectations on Wednesday, driven by a 40% increase in revenue from Asia, a region that is crucial for its growth strategy. The Asian operations, which span 12 markets and over 100 banking partnerships, represent a significant source of revenue. Core earnings for the quarter ending June 30 increased to $1.74 billion, or 97 cents per share, up from $1.64 billion or 83 cents per share a year prior, surpassing analyst expectations of 88 cents per share.
• Nutrien: The fertilizer producer exceeded second-quarter profit forecasts on Wednesday, propelled by higher potash sales in international markets, and appointed insider Mark Thompson as the new chief financial officer. Nutrien projects 2024 potash sales volumes to be between 13.2 million and 13.8 million tons, revised from the earlier range of 13 million to 13.8 million tons. The company has lowered its 2024 adjusted core earnings forecast for retail sales due to challenges in the Brazilian market, where high inventory levels and subdued demand have affected margins. Adjusted second-quarter earnings of $2.34 per share surpassed estimates of $2.21.
• Restaurant Brands International: The restaurant chain exceeded Wall Street’s revenue expectations for the second quarter, as Tim Hortons and Burger King locations experienced steady demand despite a broader slowdown in the U.S. fast-food industry. Average traffic at Burger King locations rose 4.3% during the quarter, compared to a 1% increase a year earlier, according to Placer.ai data. The company reported second-quarter revenues of $2.08 billion, surpassing analysts’ average expectation of $2.02 billion.
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RECOMMENDATIONS
• Air Canada: JPMorgan has reduced its price target from $41 to $36, following lowered guidance for future quarters and ongoing cost pressures that are affecting profitability.
• Finning International: RBC has raised its price target from $49 to $50 after stronger-than-expected results in the second quarter and a positive outlook.
PUBLICATIONS OF RESULTS
August 8:
Groupe Altus: Q2 earnings per share forecast of $0.57
ATS: Q1 earnings per share forecast of $0.52
B2Gold: Q2 earnings per share forecast of US$0.07
Boyd Group Services: Q2 earnings per share forecast of US$0.66
Brookfield: Q2 earnings per share forecast of US$0.78
Canadian Tire Corporation: Q2 earnings per share forecast of $2.42
CCL Industries: Q2 earnings per share forecast of $1.03
CES Energy Solutions: Q2 earnings per share forecast of $0.15
CI Financial: Q2 earnings per share forecast of $0.86
Denison Mines: Q2 loss per share forecast of $0.02
Exchange Income: Q2 earnings per share forecast of $0.85
goeasy: Q2 earnings per share forecast of $4.03
IAMGOLD: Q2 earnings per share forecast of US$0.09
Interfor: Q2 loss per share forecast of $0.68
Jamieson Wellness: Q2 earnings per share forecast of $0.32
Keyera: Q2 earnings per share forecast of $0.54
Linamar: Q2 earnings per share forecast of $2.97
Lundin Gold: Q2 earnings per share forecast of US$0.42
Aliments Maple Leaf: Q2 earnings per share forecast of $0.19
Mattr: Q2 earnings per share forecast of $0.31
MDA Space: Q2 earnings per share forecast of $0.10
Nuvista Energy: Q2 earnings per share forecast of $0.42
Pembina Pipeline: Q2 earnings per share forecast of $0.75
Power Corporation du Canada: Q2 earnings per share forecast of $1.13
Premium Brands Holdings: Q2 earnings per share forecast of $1.30
Primo Water: Q2 earnings per share forecast of US$0.25
Quebecor: Q2 earnings per share forecast of $0.83
Restaurant Brands International: Q2 earnings per share forecast of US$0.86
Known: Q1 earnings per share forecast of $0.37
Sleep Country Canada Holdings: Q2 earnings per share forecast of $0.36
August 9:
Algonquin Power & Utilities: Q2 earnings per share forecast of US$0.08
Atkinsrealis Group: Q2 earnings per share forecast of $0.50
Constellation Software: Q2 earnings per share forecast of US$19.39
Accept: Q2 earnings per share forecast of $0.58
Filo: Q2 loss per share forecast of $0.23
COMPANY AGENDA
08h00 Restaurant Brands International: Q2 Results Teleconference
08h00 SilverCrest Metals: Q2 Results Conference Call
08h00 Stantec: Q2 Results Teleconference
08h00 Torex Gold Resources: Q2 Results Teleconference
08h00 Wheaton Precious Metals: Q2 Results Teleconference
08:30 Pason Systems: Q2 Results Teleconference
08:30 Premium Brands Holdings: Q2 Results Teleconference
08:30 Primo Water: Q2 Results Teleconference
08:30 Quebecor: Q2 Results Teleconference
09h00 Aliments Maple Leaf: Q2 Results Teleconference
09h00 MDA Space: Q2 Results Teleconference
09h00 Nexgen Energy: Q2 Results Teleconference
09h00 Nutrien: Q2 Results Teleconference
09h00 Onex: Q2 Results Teleconference
09h00 Pan American Silver: Q2 Results Teleconference
10h00 Jamieson Wellness: Q2 Results Teleconference
10h00 Keyera: Q2 Results Teleconference
10h00 Linamar: Q2 Results Teleconference
10h00 Manulife Financial Corporation: Q2 Results Teleconference
10h30 Innergex Renewable Energy: Q2 Results Teleconference
11:00 a.m. CI Financial: Q2 Results Teleconference
11:00 a.m. Fortuna Mining: Q2 Results Teleconference
11:00 a.m. IGM Financial: Q2 Results Teleconference
12h00 Canadian Tire Corporation: Q2 Results Teleconference
17h00 Groupe Altus: Q2 Results Teleconference
17h00 ATS: Q1 Results Teleconference
17h00 Boyd Group Services: Q2 Results Teleconference
COUPON DETACHMENTS
Canadian Utilities: Amount $0.45
(All analyst estimates are based on IBES data from LSEG)
Essential News and Market Insights
Canada to fund study on impact of oil sands on health of Indigenous communities
Canada’s government has announced funding for an Indigenous-led study examining the health impacts of oil sands development on local communities. This initiative comes on the heels of a tailings water leak from an Imperial Oil site, which has reignited concerns over pollution and its effects on Indigenous peoples living nearby.
Eli Lilly raises full-year profit forecast as Zepbound quarterly sales top $1 billion
Eli Lilly has demonstrated impressive growth, raising its annual profit forecast as sales of its weight-loss medication, Zepbound, exceeded $1 billion for the first time in a quarter. This achievement underscores the rising demand for effective weight management solutions in the pharmaceutical market.
Burger King parent company beats revenue estimates on resilient fast-food demand
Restaurant Brands International has reported better-than-expected second-quarter revenue, driven by robust demand at its Tim Hortons and Burger King outlets. This performance stands out against a backdrop of a broader slowdown in the U.S. fast-food sector, highlighting the resilience of these brands in the fast-food market.
Insurer Manulife’s second-quarter profit rises on strong growth in Asia
Manulife Financial Corp. recorded a stronger-than-anticipated quarterly profit, largely thanks to a 40% rise in revenue from its Asian markets. This region is becoming increasingly vital for Manulife’s long-term growth strategies, which are evident in their enhanced focus on building partnerships across various banking sectors.
Nutrien beats quarterly profit estimates, appoints insider Mark Thompson as CFO
Fertilizer giant Nutrien outperformed expectations in their second-quarter profit results due to increased potash sales in international markets. Additionally, the firm has appointed Mark Thompson as the new chief financial officer, reflecting confidence in leadership to navigate future market challenges.
Market Trends Before Opening
Futures contracts for the main Canadian stock index are on the rise, buoyed by potential increases in gold prices and positive business performance reports. Meanwhile, US stock index futures showed little movement as investors remain cautious in advance of weekly jobless claims data release. A speech by Richmond Fed President Thomas Barkin is anticipated to provide further insights regarding the Federal Reserve’s upcoming decisions.
European stocks are experiencing declines, primarily due to dips within the technology sector. In Japan, the stock market faced downward pressure as domestic chip companies mirrored losses seen in the previous Wall Street session, compounded by a “hawkish” stance indicated in the Bank of Japan’s latest minutes. The US dollar and Treasury bond yields have both seen a decline, while oil prices remained steady following recent upward adjustments.
Titles to Watch
- Manulife Financial Company: The insurer reported core earnings of $1.74 billion, surpassing analyst expectations, indicating strong performance with a continuous focus on Asian markets.
- Nutrien: The company raised its 2024 potash sales volume projections, reflecting optimistic market conditions despite a cautious outlook for retail sales in Brazil.
- Restaurant Brands International: The fast-food joint reported a Q2 revenue of $2.08 billion, surpassing analyst predictions and establishing a solid growth trajectory.
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Recommendations
- Air Canada: JPMorgan has reduced its price target from $41 to $36 due to lower quarterly guidance and ongoing profitability challenges.
- Finning International: RBC has raised its price target to $50 from $49 following impressive second-quarter results that exceeded market expectations.
Upcoming Earnings Releases
For August 8
| Company | EPS Forecast |
|---|---|
| Groupe Altus | $0.57 |
| ATS | $0.52 |
| B2Gold | US$0.07 |
| Boyd Group Services | $0.66 |
| Brookfield | $0.78 |
| Canadian Tire Corporation | $2.42 |
| CCL Industries | $1.03 |
| CES Energy Solutions | $0.15 |
| CI Financial | $0.86 |
| Denison Mines | -US$0.02 |
For August 9
| Company | EPS Forecast |
|---|---|
| Algonquin Power & Utilities | US$0.08 |
| Atkinsrealis Group | US$0.50 |
| Constellation Software | US$19.39 |
| Accept | $0.58 |
| Filo | -US$0.23 |
Corporate Teleconferences
On August 8 at 08:00:
- Restaurant Brands International
- SilverCrest Metals
- Stantec
- Torex Gold Resources
- Wheaton Precious Metals
On August 8 at 08:30:
- Pason Systems
- Premium Brands Holdings
- Primo Water
- Quebecor
On August 8 at 09:00:
- Aliments Maple Leaf
- MDA Space
- Nexgen Energy
- Nutrients
- Onex
- Pan American Silver
Dividend Detachments
Canadian Utilities: Amount $0.45
(All analyst estimates are based on IBES data from LSEG)
