A roundup of some of the North American equities making moves in both directions today
On the rise
Shares of Canopy Growth Corp. (WEED-T) reversed early losses and closed 2 per cent higher on Wednesday following the surprising departure of Bruce Linton from his position as co-CEO and as a member of the Smiths Falls, Ont.-based company’s board of directors.
Mark Zekulin, previously co-CEO along with Mr. Linton as well as Canopy’s president, will temporarily hold the position alone while he assists the board in a search for new leadership. Rade Kovacevic, previously senior vice-president of sales, will assume the president role.
Tesla Inc. (TSLA-Q) jumped 4.5 per cent as the Street applauded its record-setting quarterly vehicle delivery results.
After the bell on Tuesday, the electric vehicle maker said it delivered 77,550 Model 3s, the company’s latest sedan model and key to its growth strategy, in the second quarter. The Street was projecting 73,144.
Overall, Tesla deliveries of all models rose 51 per cent from the first quarter to 95,200 vehicles. Analysts on average were expecting total deliveries of 89,084.
Canaccord Genuity analyst Jed Dorsheimer said: “We view the strong delivery numbers as further evidence that much discussed ‘demand cliff’ theory is flawed, and believe that Tesla is well positioned to capitalize on the inflection higher of EV penetration rates.”
RBC Dominion Securities’ Joseph Spak took a more cautious tone, noting: "While 2Q19 units were better, we still caution 1) that mix of vehicles (and discounting to move units) could weigh on profitability and hence 2Q19 likely sacrificed margins for units. We find the company focus on a few thousand units to hit short-term targets somewhat curious for a story so long-term focused, and 2) the strong push at the end of the 2Q19 could have pulled forward some demand.
“Of note, Tesla did not reaffirm guidance as they did in the 1Q19 delivery release. Existing full year delivery guidance of 360-400k implies 110.9k per quarter in 2H (at the midpoint) or 16 per cent higher than the record 2Q19 deliveries which seems aggressive to us.”
Mullen Group Ltd. (MTL-T) rose 3.3 per cent after an equity analyst at CIBC World Markets upgraded it stock before the bell.
On Tuesday, the Okotoks, Alta.-based company announced the acquisition of Argus Carriers Ltd. and Inter-Urban Delivery Service Ltd., both of which provide transportation and logistics services in the Vancouver area.
Symantec Corp. (SYMC-Q) jumped 14 per cent amid reports that Broadcom Inc. (AVGO-Q) is in advanced talks to buy the cybersecurity firm.
A deal would expand Broadcom’s push into software a year after its US$18.9-billion deal to buy U.S. business software company CA Inc. It also follows Broadcom’s failed bid to buy Qualcomm Inc.
Shares of Broadcom fell 3.5 per cent.
Brookfield Renewable Partners LP (BEP-UN-T) rose 0.5 per cent after announcing with its institutional partners the acquisition of a 50-per-cent stake in Spanish solar developer X-Elio for US$500-million.
In a research note, Industrial Alliance Securities analyst Jeremy Rosenfield said: “BEP remains the premium Canadian renewable energy name. The growth outlook for BEP remains strong, as the Company continues to target longterm average annual FFO/share growth of 6-11 per cent and total shareholder returns of 12-15 per cent. The announced X-Elio acquisition further expands the Company’s portfolio of operating solar assets, and adds a significant development pipeline that could drive additional future growth. With significant pro forma liquidity available (US$2-billion), we expect BEP to remain active on the M&A front on an opportunistic basis.”
On the decline
Boyd Group Income Fund (BYD-UN-T) declined 0.4 per cent in the wake of revealing late Tuesday it detected a ransomware attack on a subset of its information technology system on June 27.
The Fund said there is no evidence that customers’ or employees’ information was compromised.
Desjardins Securities analyst David Newman said: “While BYD will likely experience a temporary interruption of service and the loss of some sales, the overall financial impact is expected to be minimal (some modest impact in 2Q19 and 3Q19), in part due to the proactive steps it is taking to control the situation. We believe the company’s decision to disclose the incident highlights its commitment to client relationships based on transparent communication. BYD is expected to report 2Q19 results around August 14; we will look to the company to provide some preliminary colour around the impact of the cyberattack on its operations.”
Canaccord Genuity Group Inc. (CF-T) sat flat after announcing the terms of its previously announced substantial issuer bid to repurchase for cancellation up to $40-million of its common shares.
The offer is being made through a modified Dutch auction, which will allow shareholders who choose to participate to individually select the price, within a range of not less than $5.50 per common share and not more than $6.30. Upon expiry of the offer, the company will determine the lowest purchase price (which will not be more than $6.30 and not less than $5.50) that will allow it to purchase the maximum number of common shares properly tendered to the offer, and not properly withdrawn, having an aggregate purchase price not exceeding $40-million.
Guyana Goldfields Inc. (GUY-T) fell 6.5 per cent after announcing a wildcat work stoppage occurred Tuesday at its Aurora Mine in Guyana.
“A portion of the workforce employed by the Company’s wholly owned subsidiary, AGM Inc., has blocked delivery of ore to the mill," the company said. “As a safety precaution, the Company has decided to temporarily suspend operations until a resolution is reached with the striking workers, and is in the process of evacuating all non-essential personnel from site, including the striking workers.”
With files from Brenda Bouw, staff and wires
David Leeder