A roundup of some of the North American equities making moves in both directions today
On the rise
Alimentation Couche-Tard Inc. (ATD.B-T) finished 0.1 per cent higher on Tuesday after Caltex Australia Ltd., Australia’s largest retail fuel and convenience chain, rejected a $7.7-billion takeover offer, however it is giving the Canadian company a chance to increase its bid.
The Australian company says the current proposal undervalues the company and “does not represent compelling value for Caltex’s shareholders.”
The Caltex board has offered Couche-Tard access to selected non-public information to allow the Canadian company to come up with a revised offer.
Shares of Cleveland-Cliffs tumbled 9.8 per cent.
On the decline
Endeavour is offering 0.0846 of its shares for each Centamin share, a 13.1-per-cent premium to Tuesday’s closing price.
The unsolicited offer for Centamin is the latest in what has been a particularly active period for mergers and acquisitions (M&A) in the Canadian mining industry.
On Monday, China’s Zijin Mining Group Co. Ltd. announced it was buying Canada’s Continental Gold Inc. for $1.4-billion, and just over a week ago, Kirkland Lake Gold said it intended to snap up Detour Gold Corp. for $4.9-billion.
Continental Gold shares (CNL-T) were down 1.1 per cent a day after jumping over 10.5 per cent.
BMO took a $484-million restructuring charge that dented its profit in the fiscal quarter, and raised its dividend.
Profit fell 30 per cent from a year earlier due mostly to the restructuring costs, which amount to $357-million after tax.
For the three months that ended Oct. 31, BMO reported profit of $1.19-billion, or $1.78 per share, compared with $1.7-billion, or $2.58 per share, in the same quarter last year.
Excluding the restructuring charge and other one-time items, BMO said its adjusted profit was up 5 per cent, and earnings per share was $2.43 per share. On average, analysts expected adjusted earnings of $2.41 per share, according to data from Refinitiv.
BMO increased its quarterly dividend by 3 cents to $1.06 per share.
- James Bradshaw
Canadian National Railway Co. (CNR-T) declined 2.2 per cent after announcing before the bell it is cutting its profit guidance in the wake of an eight-day strike by 3,200 workers that brought the railway to a near halt.
The railway says it is now targeting 2019 adjusted diluted earnings per share growth in the low to mid single-digit range compared with last year’s adjusted diluted earnings per share of $5.50.
The company had earlier expected adjusted diluted earnings per share growth in the high single-digit range.
CN estimated the strike reduced its earnings per share by about 15 cents.
Production is expected to be between 800,000 to 840,000 barrels of oil equivalent per day (boe/d), a 5-per-cent increase over the midpoint of its 2019 forecast, the company said.
Canaccord Genuity analyst Dennis Fong said: “Suncor announced 2020 production guidance which was in line with our expectations and consensus. The range of production guidance reflects the uncertainty associated with the government’s potential rollback of the mandatory curtailment program. Capex was below our expectations, but in line with consensus. Variances to our estimates stem primarily from lower than expected upstream oil sands and E&P spending partially offset by higher spending on downstream and corporate including the sanction of the Forty Mile Wind Power Project in southern Alberta. Of note, the lower end of Suncor’s budget assumes the mandatory production curtailments announced by the government are in place for 2020, whereas the upper end assumes most of the year is not impacted by the mandatory curtailments. We estimate Suncor will show an after dividend free cash flow of $3.0-billion at US$55/ Bbl WTI in 2020, suggesting the company will continue its focus on cash returns to shareholders. We believe this means that Suncor will look to increase its dividend in early 2020 and renew its NCIB for at least $2.5-billion.”
Hudson’s Bay Co. (HBC-T) slid 4.4 per cent after its board of directors rebuffed Catalyst Capital Group Inc. and its $2-billion proposal to take over the retailer, saying the bid would have no chance of winning over the majority stake controlled by HBC executive chairman Richard Baker.
Catalyst proposed last week to offer $11 a share in cash for HBC in an attempt to thwart Mr. Baker and his allies, which have offered $10.30 for the minority shares in a plan to privatize the company.
The Baker group controls 57 per cent of the stock and has said it has no intention to sell, an assertion it reiterated to the five-director panel.
- Jeffrey Jones
Shares of Bausch Health Companies Inc. (BHC-T) was down 1 per cent after three pharmacy chains, including Walgreens Boots Alliance Inc. (WBA-Q), filed a lawsuit against the drugmakers and peers Assertio Therapeutics Inc. (ASRT-Q) and Lupin Ltd., seeking damages for overcharging for Bausch’s diabetes drug Glumetza.
The lawsuit, filed on Monday, alleges that Assertio and Lupin struck a deal with units of Bausch to delay the entry of their generic versions of Glumetza and allowed the companies to “maintain a monopoly” in the sale of the branded drug and its generic copies.
Albertson Companies Inc and Kroger Inc were among the other defendants.
With files from staff and wires