Today's Analyst Upgrades and Downgrades: Key Stock Movements

Inside the Market’s roundup of some of today’s key analyst actions While Boralex Inc. (BLX-T) saw “stronger” power generation in the fourth quarter, National Bank Financial analyst Baltej Sidhu emphasizes its performance continues to fall short of long-term averages, leading him to lower his forecast for the Kingsey Falls, Que.-based company. “Ahead of Q4E results, we have updated our estimates to reflect slightly weaker consolidated generation and the removal of the quarterly contribution from its Ontario BESS assets (Hagersville and Sanjon), as COD comes later than we anticipated (approximately $10-million reduction to our Q4/25E adj. EBITDA),” he explained. “For Q4/25E, we expect generation to improve sequentially versus earlier quarters in 2025, though to come in modestly below LTA at 2,533 GWh (was 2,706 GWh), representing 96 per cent of LTA. We saw strength in BLX’s Canadian wind portfolio (estimated at 105 per cent of LTA); however, it was insufficient to offset softer generation across the remainder of its portfolio. With that, and among other calibrations, our Q4E EBITDA forecast declines to $206-million (was $231-million; consensus $224-million). “Looking to 2026E, we modestly reduce generation by 30 GWh to reflect downtime related to the Grand Camp repowering project (COD expected in H2/26E) as we estimate an six-month shutdown, delayed contribution from Hagersville in Q1/26E (now assuming two-thirds of a full-quarter contribution), and minor hydro LTA recalibrations.” Mr. Sidhu called its fourth-quarter growth “largely a timing story rather than an execution or cost issue” with its Sanjgon (formerly Tilbury) battery energy storage system (BESS) reaching commissioning late in the year following a short authorization-related delay. However, he now sees project ramp-ups setting the stage for near-term growth. “The 300MW/1200MWh Hagersville BESS project, initially expected online in Q4/25E, should reach COD in the coming weeks, also with no incremental costs,” he explained. “Further out, BLX retains optionality for growth, including potential FID acceleration for two U.S. solar farms in New York (450 MW total), the 125 MW/500 MWh Oxford battery storage project (Ontario, COD ’27E), and the 400 MW Des Neiges Sud wind project (Quebec, COD ’27E) alongside various projects in France, supporting long-term growth visibility. We expect BLX to be an active participant in various RFPs during 2026E including those for: Hydro-Quebec, Ontario LT2, France, and UK AR7a.” While he cut his 2026 EBITDA forecast, largely to reflect updated forward pricing assumptions for France power pricing, Mr. Sidhu emphasized Boralex possesses “ample” liquidity, which he thinks “anchors growth.” “BLX maintains strong financial flexibility with $811-million in liquidity as of Q3, which we believe positions it well to fund its organic development plans (targets 17-per-cent installed capacity CAGR [compound annual growth rate] to 2030),” he said. “BLX has multiple levers to support growth including refinancing, incremental leverage, or asset sell-downs; where we expect U.S. or UK projects could be a lever. BLX also has access to over $400-million in ITC credits to support growth in Canada.” Reiterating his “outperform” rating, Mr. Sidhu reduced his target for Boralex shares to $39 from a Street-high of $41. The average target is $35. “With our model update, we reflected the assumed benefit of the ITC proceeds for its Apuiat wind project and two Ontario battery projects - Sanjon reached COD in late Q4/25, and Hagersville is expected to COD through the end of January,” he said. “We assume BLX will immediately deploy the proceeds to repay bridge financing associated with these projects, generating meaningful interest savings of approximately $14 mln annually beginning in 2027E, which translates to a positive $1.55/sh impact to our target price. Additional model refinements—including debt amortization adjustments, hydro opex/MWh re-calibrations, and stronger pricing at one of its U.S. wind farms—account for the remaining puts and takes and drive the net~$2/sh downward revision to our target price." Pointing to “persistent balance sheet risk” and a “stretched” valuation, TD Cowen analyst Sean Steuart downgraded Vancouver-based Mercer International Inc. (MERC-Q) to a “sell” rating from “hold” previously following “a sharp share price recovery from cyclical lows since mid-November 2025.” “Given high balance sheet leverage and expected negative free cash flow over our forecast horizon, we struggle to reconcile recent share price strength (up more than 70 per cent from a very low base over the past two months),” he said. “We see limited options for deleveraging MERC’s balance sheet even as pulp markets reach a cyclical floor. There are more compelling risk/reward opportunities elsewhere in the sector.” Mr. Steuart emphasized the forest products company does not face imminent liquidity and balance sheet constraints, however he thinks its debt load and interest burden are high. “Trailing net debt-to-cap is 80 per cent, and we expect that ratio will increase to almost 90 per cent by the end of 2027,” he noted. “With an almost three-year window before the next note maturity in 2028, MERC has a reasonable liquidity cushion ($376-million at the end of Q3/25), but our cumulative FCF forecast between Q4/25 and the end of 2027 is ($47) million. The annual interest burden of $123-million undermines FCF potential. Management previously qualified revolver renewal conversations with lending counterparties as constructive. “Management is pulling levers to preserve available liquidity. We expect that 2026 and 2027 capex will reach the lowest annual levels since 2017. The company is also focused on reducing working capital by $20-million in the near term and on a run-rate annual cost reductions of $100-million by year-end 2026.” Seeing global pulp markets “passing the cyclical trough” and mill inventories “remain elevated,” he raised his 12-month target price to US$2.25 per share from $2.00 to reflect the inclusion of 2027 estimates in his valuation as well as adjustments to expected capex/working capital over his forecast horizon. “Our 2025 and 2026 earnings estimates are declining, reflecting modest pulp price forecast revisions plus other adjustments to volume assumptions,” he noted. “Stretched valuation. At 6.7 times 2027 estimated EV/EBITDA, MERC trades in-line with its global peer group, which we believe is excessive given balance sheet risk.” Citi analyst Patrick Cunningham sees a “slowly improving” environment for North American specialty chemicals companies as fourth-quarter 2025 earnings season ramps up. “We expect specialty chemicals to see modest low-single-digit organic growth, mostly driven by pockets of structural pricing and select end-markets strength,” he said. “That said, with new tariff announcements on select members of NATO, we believe investor focus will center around demand uncertainty and the raw materials basket. While it remains to be seen whether the new tariff announcements on Denmark, Norway, Sweden, the UK, France, Germany, Netherlands, and Finland will be implemented, we still believe the broader coverage universe may be caught up in these concerns. While specialty chems had been generally insulated on most direct tariff impacts in 2025 due to ‘local-for-local’ supply chains, we note that further tariff risks would likely further push out a broader recovery.” Pointing to “marginally better FX and top-line environment while noting potential fresh tariff risks,” Mr. Cunningham made modest changes across his coverage universe to his fourth-quarter 2025 and full-year 2026 projects while increasing “significantly” his projections for lithium producers, including Lithium Royalty Corp. (LIRC-T). However, he downgraded his rating for the Toronto-based company to “neutral” from “buy” to reflect limited upside following its definitive agreement to be acquired by Altius Minerals Corp. (ALS-T) in a stock-and-cash deal valued at about $520-million, which has sent its shares higher by more than 40 per cent. “With LIRC ultimately trading near the implied transaction value tied to Altius Minerals’ share price, we downgrade LIRC from Buy to Neutral,” he said. “We continue to view the FY26 setup for lithium fundamentals favorably, with robust ESS demand growth supporting prices. At the same time, we are closely monitoring supply dynamics like the Jianxiawo mine restart.” Mr. Cunningham raised his target for Lithium Royalty sharss to $10.60 from $9. The average is $8.75. TD Cowen analyst John Shao is predicting Celestica Inc. (CLS-N, CLS-T) will report better-than-expected fourth-quarter 2025 results on Jan. 28 and see the benefits of “consistent execution” through the current fiscal year. Assuming coverage of the Toronto-based tech manufacturer from colleague Daniel Chan, he thinks there is “little downside risk” for the quarterly release. “We forecast Q4/25 total revenue of $3.6-billion, up 42 per cent year-over-year,” he said. “We estimate Advanced Technology Solutions (ATS) revenue of $798-million, down 1 per cent year-over-year; Communications revenue of $2.1-billion, up 78 per cent year-over-year; and Enterprise revenue of $717-million, up 28 per cent year-over-year. We forecast EBIAT of $280-million, or 7.7-per-cent EBIAT margin, up 90bps year-over-year. We also expect EPS of $1.85. “We believe the upward revisions to guidance will continue, with previous EPS revisions raised an average 6 per cent for the first time (in January) following the initial guidance set in October. We currently forecast 2026 revenue of $17.1-billion and EPS of $9.27, well above consensus at $8.42 due to what we believe is a larger Networking opportunity in 2026.” In a client note released before the bell, Mr. Shao argues Celestica has “undoubtedly earned its premium valuation given its consistent execution, customer profile, supply chain expertise, strong market tailwinds, and most importantly, strong management team.” “We believe none of these will change in 2026 and we will continue to like the company for the same reasons,” he added. “In an ideal scenario, its execution and continuously improving financials should drive the stock’s consistent appreciation. Realistically though, we believe the CLS trade is intricately tied to the broader AI trade which exhibits increasing volatility and fragility. As much as we are excited about CLS’ upside potential, we are fully aware of the associated risks. It is this risk-based approach that leads us to maintain our HOLD rating. Admittedly, we acknowledge the situation remains highly fluid and we will revisit our rating should either of the following developments occur: More clarity from Celestica’s digital-native customer regarding the status of its ASIC program, funding, program size, and timeline; Customer concentration improves; Opportunistic entry points should future volatility weaken the stock price.” With his “hold” rating, Mr. Shao reaffirmed the firm’s target of US$305. The average on the Street is US$370.75. “Despite our belief that the company is a major beneficiary of accelerated AI-related infrastructure build-outs from its hyperscale cloud customers, we rate Celestica HOLD as its valuation currently exceeds industry leaders,” he said. “We believe we are in the early stages of what could be a multi-year investment cycle with long-term commitments. Current demand for proprietary compute programs is being followed by an 800G networking upgrade cycle, expected to accelerate in 2025, and storage solutions. In the ATS segment, we believe the long-term growth target of 10 per cent is achievable, given the large opportunity for outsourced manufacturing, particularly in markets that require a high level of engineering expertise.” National Bank Financial analyst Rabi Nizami sees Omai Gold Mines Corp. (OMG-X) “leveraging a sizeable and recent 6.5 Moz resource base and advantages of a past-producing mine site to deliver one of the fastest advancing development opportunities in the Guiana Shield.” He initiated coverage of the Toronto-based company, which is re-establishing one of South America’s largest historic gold mines, with an “outperform” rating, emphasizing its potential scale and speed to production at the 100-per-cent-owned property. “While the market has recognized the rapid growth of total resources (OMG up 479-per-cent last 12-month return vs. XGD up 165 per cent), we believe Omai’s approximately US$790-million market cap remains undervalued in advance of further economic studies and accelerated permitting milestones, which we believe position the company as a prime M&A target for Senior/Intermediate gold producers to add a large and readily advanceable gold project in a friendly mining jurisdiction in Guyana,” said Mr. Nizami. “We model a combined open pit and underground mining operation capable of nearly 300 koz annual production over a 16+ year mine life, NPV5% [net present value at a 5-per-cent discount rate] of US$2.4 billion with 25-per-cent IRR [internal rate of return] at US$3,000/oz gold upon construction start (US$4.4 billion and 40 per cent at US$4,000 gold).” The analyst said the project possesses several notable past-producing advantages, including “established road access, existing tailings infrastructure, and regulatory clarity to permit rapidly in Guyana.” “Drilling success, including deep shear-hosted intercepts 600–700 metres below the deposit, reinforces the long-term underground potential and the emergence of a 10 Moz district," he added Despite the “scale and momentum,” Mr. Nizami noted Omai currently trades at a discounted valuation with shares reflecting a price-to-net-asset-value multiple of 0.36 times on his “conservative” base case and at an enterprise value of US$116 per shares (versus peers at an average 0.66 times and US$275/oz), noting that is “well below comparable valuations paid in recent transactions and meaningfully below comparable resource-stage peers.” He set a target of $3 per share. The current average is $2.48. “Our target price is based on a 0.65 times multiple to NAVPS plus corporate adjustments,” he said. “We view the upcoming MRE/PEA, permits, pit dewatering, and continued infill/exploration drilling as catalysts to drive a re-rating and entice an M&A takeout. “Our thesis considers: (i) a legacy mining project that can leverage a friendly permitting environment in Guyana and advance quickly to a construction-ready stage, ii) attractive project economics and discounted valuation relative to our modeled expectations, and iii) clear M&A target that we believe should be of interest to Intermediate and Senior producers,” he said. “Our target price is based on a 0.65-times multiple to NAVPS, which is consistent with peers under NBCM coverage. We ascribe a Speculative risk rating given the stage of the company where several de-risking initiatives including further studies, permitting, funding and development milestones are to be achieved prior to generating positive free cash flow.” In a separate report, Mr. Nizami resumed coverage of Bravo Mining Corp. (BRVO-X) following its $86-million public share issuance and an additional $35-million private placement with Orion Mine Finance, emphasizing it is now “well capitalized to de-risk” and explore its Luanga project in Brazil. “The entry of Orion, a respected mining-focused private equity group is set to bring validation of technical merit and economic potential following the 2025 PEA and ahead of further advanced engineering and technical studies,” he said. “Orion has provided a non-binding term sheet for an up to US$300-million financing package alongside the pending private placement.” “We estimate a pro forma cash position of $140-million (Canadian), which is significant and represents 22 per cent of pro forma market capitalization of $625-millionn. We expect the funds to fully cover the Luanga project through the upcoming de-risking milestones covering metallurgical testing, Preliminary Feasibility Study (mid-2026) and Feasibility Study stages, while leaving ample cash for aggressive resource expansion and regional drilling. We expect the company to outline new budgets and a refreshed exploration outlook in the coming months.” Reaffirming his “outperform” rating for Bravo shares, Mr. Nizami said the Toronto-based company provides investors with “torque” to platinum-group metals (PGMs). “The rally in PGMs (Pt+Pd+Rh) has brought attention back to the sector, and highlights a scarcity of PGM development projects in safe jurisdictions,” he explained. “The Brazilian government recently selected Bravo as anchor tenant for a newly-created Barcarena free trade zone, which further opens the company to global M&A interest.” “The 100-per-cent-owned Luanga project is one of the few large-scale PGM open-pittable deposits globally, located outside major geopolitical risks and labour or infrastructure challenges (for contrast, global PGM supply is currently tied mostly to Russia and South Africa). The project’s unique address near other permitted precedent mines and ready rail access could mean faster response time to develop and gain access to global PGM smelter markets; this could differentiate Luanga from PGM development opportunities elsewhere. Bravo’s anchor position to lead development of a PGM smelter within a newly created free trade zone in Brazil further opens the company to global M&A interest.” The analyst bumped his target for Bravo shares to $7.50 from $7. The average is $6. In other analyst actions: * With the results of a preliminary economic assessment for its Kemess project in British Columbia, Raymond James’ Brian MacArthur increased his target for Centerra Gold Inc. (CG-T) to $27 from $24.50, keeping a “market perform” rating. The average is $22.52. “The PEA highlights the potential for Kemess to become a second copper-gold asset in BC, and it also dilutes the relative value of the moly assets in CG,” he said.