A roundup of some of the North American equities making moves in both directions today
On the rise
Shares of Yamana Gold Inc. (YRI-T) were up 4.8 per cent in early afternoon trading on Friday after announcing an agreement with Glencore International PLC and Goldcorp Inc. (G-T) on Thursday to develop and operate Yamana’s Agua Rica gold and copper mine in Argentina using infrastructure and facilities of the three companies’ existing venture in the country.
“The Agreement represents a significant step forward towards the optimization of Agua Rica. The Alumbrera infrastructure, including the existing infrastructure for concentrate logistics located in northern Argentina between the mine site and the port, presents a unique opportunity to enhance project economics while also reducing both the project complexity and environmental footprint,” the companies said in a statement.
Yamana will own a 56.25-per-cent stake, while Glencore gets 25 per cent and Goldcorp 18.75 per cent.
Goldcorp shares were up sitting flat.
Barrick Gold Corp. (ABX-T) increased 1.4 per cent after chief executive officer Mark Bristow told CNBC the company is having “constructive” talks with Newmont Mining Corp. (NEM-N) about a possible joint venture in Nevada.
“We are engaged in a constructive manner,” Bristow said on the network’s Mad Money program on Thursday evening. “We are talking. That’s a good thing.”
In New York, Newmont was up 0.7 per cent.
Gold shares jumped on Friday morning after weaker-than-expected jobs data south of the border weighed on the U.S. dollar.
Rises included Alamos Gold Inc. (AGI-T), which jumped 4.5 per cent, and Kinross Gold Corp. (K-T), which sat 5 per cent higher.
Costco Wholesale Corp. (COST-Q) jumped 4.7 per cent after reporting a better-than-anticipated quarterly profit as margin pressures eased. Net income rose to US$889-million, or US$2.01 per share, from US$701-million, or US$1.59 per share, a year earlier. Analysts had expected a profit of US$1.69 per share
RBC Dominion Securities analyst Scot Ciccarelli said: "We continue to think of Costco as the ultimate rinse and repeat model, as they invest more in pricing/value for their members, which in-turn drives more traffic into their stores, which enables them to command even better pricing from their vendors – and repeat. As we have continued to highlight … Costco works on one of the thinnest GM structures in all of retail (subsidized by their Membership model), enabling them to out-price their competitors – even before factoring in their massive buying power."
IBI Group Inc. (IBG-T) rose 10.4 per cent after reporting on Thursday fourth-quarter revenue and earnings per share of $92.4-million and 10 cents, respectively, exceeding the expectations on the Street of $85.7-million and 6 cents.
Great-West Lifeco Inc. (GWO-T) was up 0.5 per cent after announcing the terms of its previously announced substantial issuer bid to repurchase for cancellation up to $2.0-billion of its common shares from shareholders for cash. The Offer will commence today and expire on April 12.
"This transaction will allow us to return capital to our shareholders while maintaining significant excess capital to fund strategic investments, including acquisitions, to drive growth and profitability," said Great-West president and chief executive officer Paul Mahon.
Great-West is a subsidiary of Power Financial Corp. (PWF-T), which was 0.5 per cent higher after announcing the terms of its own buyback of $1.65-billion of its common shares.
“Power Financial, as previously disclosed, intends to support Great-West through its participation in the Great-West Offer and expects to use the proceeds from its participation in the Great-West Offer to fund, along with the Corporation’s available resources, the PFC Offer. The PFC Offer facilitates the repurchase of PFC shares at currently attractive valuations while maintaining a strong capital position to fund future growth opportunities,” said the company.
On the decline
MEG Energy Corp. (MEG-T) dropped 4.2 per cent in the wake of the release of weaker-than-anticipated quarterly results.
The company reported funds from operations per share of negative 13 cents, well below the consensus estimate of positive 2 cents. Production of 88,000 barrels of oil per day also missed the Street’s projection (89,000).
Raymond James analyst Chris Cox: “While the headline miss is sizeable, we believe the market is appreciative of the significant improvement in heavy oil pricing in recent months and some of the transitory dynamics that have accentuated the compression in realized pricing for many heavy oil producers during 4Q18 earnings season. Offsetting the headline miss, we suspect the added disclosure with respect to the company's blend sales will be positive for sentiment, as this dynamic may not be fully appreciated by the Street, and egress remains an important characteristic in the minds of investors, even if the financial uplift from these contracts is more muted in the current pricing environment.”
Cronos Group Inc. (CRON-T) dipped 3 per cent after announcing the $2.4-billion equity investment in the company by Altria Group Inc. (MO-N) has closed.
Altria now owns a 45-per-cent stake in Cronos and holds a warrant to require an additional stake, which, if exercised today, would raise its ownership to 55 per cent.
“We are delighted to close this transaction and kick-off a relationship that we expect to lead to significant growth and value creation,” said Cronos chairman, president and CEO Mike Gorenstein in a statement. “Altria’s investment and the services they will provide to Cronos Group will enhance our financial resources, and allow us to expand our product development and commercialization capabilities, and regulatory expertise to better position Cronos Group to compete, scale and lead the rapidly growing global cannabis industry. We look forward to the many opportunities we expect this relationship to create.”
Shares of Altria were up 0.3 per cent.
DowDuPont Inc. (DWDP-N) declined 0.5 per cent after it aid it will separate its material science unit, to be called Dow, on April 1.
DowDuPont, which was formed by the $130 billion merger of chemical giants Dow Chemical and DuPont in September 2017, is in the process of splitting itself up into three companies - Dow, DuPont and Corteva Agriscience.
In relation to the separation, the company also declared a dividend for DowDuPont stockholders, who will receive one share of Dow for every three shares of DowDuPont held as of March 21. The dividend will be payable on April 1.
U.S. large-cap banks were down in the wake of Friday's release of weak U.S. job data.
The U.S. economy created only 20,000 jobs in February, compared with expectations of nonfarm payrolls rising by 180,000 jobs last month.
“The poor number indicates that we are suffering alongside the rest of the global economy and that it is having an impact on the U.S.,” Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago, told Reuters.
In morning trading, Citigroup Inc. (C-N) was down 0.2 per cent, while Bank of America Corp. (BAC-N) was 0.2 per cent lower.
With files from Reuters and Staff
David Leeder