Nov 10, 2022
Cineplex, Canadian Tire: Analysts react to third-quarter results
, BNN Bloomberg
I'm very much a believer in movie diversification to educate our audience: Cineplex CEO
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Bay Street analysts are reacting to third-quarter results from two massive Canadian companies, and they are remaining bullish on both stocks.
Cineplex
Cineplex Inc. posted a 36 per cent rise in revenue compared to this time last year and beat analyst expectations for its third quarter. Cineplex brought in $339.8 million in the quarter compared to the $319 million expected by analysts. The company’s box office revenue was also up 70 per cent compared to pre-COVID figures in the third quarter of 2019.
One Bay Street analyst believes there will be more profits to come for Cineplex, with highly anticipated new movie releases slotted in the coming months.
“What continues to keep us bullish on Cineplex is the improving movie release schedule in Q4 and 2023. We expect strong box office revenues backed by multiple highly anticipated movies, including Black Panther and Avatar,” Maher Yaghi, an analyst at Scotia Capital, said in a note to clients on Thursday.
Yaghi has a sector outperform recommendation (the equivalent to a buy) on Cineplex shares and a 12-month price target of $14.75 on the stock.
Canadian Tire
Canadian Tire Corporation Inc. missed analyst expectations in its third-quarter earnings. The retail giant reported adjusted earnings per share of $3.34, lower than the analyst consensus of $3.92 EPS (what does EPS mean?). The company’s retail segment was the main drag on profits. Canadian Tire said the impact came from increased freight and product costs for its products. Despite the weakness, the company still raised its annual dividend for shareholders to $6.90 per share.
One analyst believes the pressure on Canadian Tire’s retail sector will be resolved.
“Our first take is that the main contributors to the retail shortfall should dissipate as supply chain constraints and IT investments normalize,” Brian Morrison, an analyst at TD Bank, wrote in a note to clients on Tuesday.
He also added that the company remains on track to maintain its 2025 strategic targets.
Morrison has a buy recommendation on Canadian Tire shares and has a 12-month target price of $215 on its shares.
Cineplex
Cineplex Inc. posted a 36 per cent rise in revenue compared to this time last year and beat analyst expectations for its third quarter. Cineplex brought in $339.8 million in the quarter compared to the $319 million expected by analysts. The company’s box office revenue was also up 70 per cent compared to pre-COVID figures in the third quarter of 2019.
One Bay Street analyst believes there will be more profits to come for Cineplex, with highly anticipated new movie releases slotted in the coming months.
“What continues to keep us bullish on Cineplex is the improving movie release schedule in Q4 and 2023. We expect strong box office revenues backed by multiple highly anticipated movies, including Black Panther and Avatar,” Maher Yaghi, an analyst at Scotia Capital, said in a note to clients on Thursday.
Yaghi has a sector outperform recommendation (the equivalent to a buy) on Cineplex shares and a 12-month price target of $14.75 on the stock.
Canadian Tire
Canadian Tire Corporation Inc. missed analyst expectations in its third-quarter earnings. The retail giant reported adjusted earnings per share of $3.34, lower than the analyst consensus of $3.92 EPS (what does EPS mean?). The company’s retail segment was the main drag on profits. Canadian Tire said the impact came from increased freight and product costs for its products. Despite the weakness, the company still raised its annual dividend for shareholders to $6.90 per share.
One analyst believes the pressure on Canadian Tire’s retail sector will be resolved.
“Our first take is that the main contributors to the retail shortfall should dissipate as supply chain constraints and IT investments normalize,” Brian Morrison, an analyst at TD Bank, wrote in a note to clients on Tuesday.
He also added that the company remains on track to maintain its 2025 strategic targets.
Morrison has a buy recommendation on Canadian Tire shares and has a 12-month target price of $215 on its shares.
