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8/9/2019 BMO Research Highlights Apr 14
1/14
April 14, 2010
TODAY'S HIGHLIGHTS
U.S. Canadian / Int'lEstimates/Targets Raised Electronics for Imaging United Company RUSAL
Qualcomm
Intel
Estimates/Targets Lowered Westamerica Bancorp Progress Energy Resources
Cascades
Sector RevisionsToys & Juvenile Products: 1Q10 Preview: Toys & Juvenile Products Still...
FINANCIALS
Banks Canada TD Bank Investor Day - Focus on Wealth Management
Banks U.S. Westamerica Bancorp Solid 1Q Results, But Growth is Challenging
REITs U.S. Sector Comment Storage to Ride Apartment Bandwagon?
ENERGY & UTILITIES
North American E&P Canada Progress Energy Resources Montney Drilling Success
MATERIALS
Metals & Mining Canada United Company RUSAL Target Price Raised to HK$9.50; 2009 Results Slightly...
Paper & Forest Prod. Canada Cascades Estimates Revised
CONSUMER
Toys & Juvenile Products Sector Comment 1Q10 Preview: Toys & Juvenile Products Still...
TECH/TELECOM/MEDIA
Enterprise Hardware U.S. Electronics for Imaging Better, In the Stock
Comms Equip U.S. Qualcomm Tweaking Numbers Ahead of Quarter; Expect Conservative...
Comms Equip Sector Comment Wireless Earnings Preview
Semiconductors U.S. Intel Not Your Father's Intel
http://research-ca.bmocapitalmarkets.com/documents/AFD05602-A3FD-4BE2-A6A3-0B1DEF9BDB6D.pdfhttp://research-ca.bmocapitalmarkets.com/documents/01C30C75-5218-49BD-8305-CC034BF9597A.pdfhttp://research-ca.bmocapitalmarkets.com/documents/F4BF0B3C-974F-46D4-81CF-CEFA948696A0.pdfhttp://research-ca.bmocapitalmarkets.com/documents/280FF28B-C335-4AED-ADE2-9A751FFD57B7.pdfhttp://research-ca.bmocapitalmarkets.com/documents/56B0D794-4133-4831-870B-37E573F91F23.pdfhttp://research-ca.bmocapitalmarkets.com/documents/DD7159AE-A658-4206-8552-B704BD39B1B3.pdfhttp://research-ca.bmocapitalmarkets.com/documents/5BC69355-17D6-4008-9171-42E5CBF9C0F1.pdfhttp://research-ca.bmocapitalmarkets.com/documents/D59CC6F7-22DB-45C3-9ACE-C43DC7FA4588.pdfhttp://research-ca.bmocapitalmarkets.com/documents/74F420D9-9159-449C-97AD-3B6C0F657EF2.pdfhttp://research-ca.bmocapitalmarkets.com/documents/56B0D794-4133-4831-870B-37E573F91F23.pdfhttp://research-ca.bmocapitalmarkets.com/documents/4C50AE1F-04E0-43D3-AD32-CF54CD10EFFE.pdfhttp://research-ca.bmocapitalmarkets.com/documents/DD7159AE-A658-4206-8552-B704BD39B1B3.pdfhttp://research-ca.bmocapitalmarkets.com/documents/01C30C75-5218-49BD-8305-CC034BF9597A.pdfhttp://research-ca.bmocapitalmarkets.com/documents/5BC69355-17D6-4008-9171-42E5CBF9C0F1.pdfhttp://research-ca.bmocapitalmarkets.com/documents/D59CC6F7-22DB-45C3-9ACE-C43DC7FA4588.pdfhttp://research-ca.bmocapitalmarkets.com/documents/AFD05602-A3FD-4BE2-A6A3-0B1DEF9BDB6D.pdfhttp://research-ca.bmocapitalmarkets.com/documents/F4BF0B3C-974F-46D4-81CF-CEFA948696A0.pdfhttp://research-ca.bmocapitalmarkets.com/documents/4E22C21D-3725-4169-821A-8BF3EDB13C4E.pdfhttp://research-ca.bmocapitalmarkets.com/documents/280FF28B-C335-4AED-ADE2-9A751FFD57B7.pdfhttp://research-ca.bmocapitalmarkets.com/documents/280FF28B-C335-4AED-ADE2-9A751FFD57B7.pdfhttp://research-ca.bmocapitalmarkets.com/documents/4E22C21D-3725-4169-821A-8BF3EDB13C4E.pdfhttp://research-ca.bmocapitalmarkets.com/documents/F4BF0B3C-974F-46D4-81CF-CEFA948696A0.pdfhttp://research-ca.bmocapitalmarkets.com/documents/AFD05602-A3FD-4BE2-A6A3-0B1DEF9BDB6D.pdfhttp://research-ca.bmocapitalmarkets.com/documents/D59CC6F7-22DB-45C3-9ACE-C43DC7FA4588.pdfhttp://research-ca.bmocapitalmarkets.com/documents/5BC69355-17D6-4008-9171-42E5CBF9C0F1.pdfhttp://research-ca.bmocapitalmarkets.com/documents/01C30C75-5218-49BD-8305-CC034BF9597A.pdfhttp://research-ca.bmocapitalmarkets.com/documents/DD7159AE-A658-4206-8552-B704BD39B1B3.pdfhttp://research-ca.bmocapitalmarkets.com/documents/4C50AE1F-04E0-43D3-AD32-CF54CD10EFFE.pdfhttp://research-ca.bmocapitalmarkets.com/documents/56B0D794-4133-4831-870B-37E573F91F23.pdfhttp://research-ca.bmocapitalmarkets.com/documents/74F420D9-9159-449C-97AD-3B6C0F657EF2.pdfhttp://research-ca.bmocapitalmarkets.com/documents/D59CC6F7-22DB-45C3-9ACE-C43DC7FA4588.pdfhttp://research-ca.bmocapitalmarkets.com/documents/5BC69355-17D6-4008-9171-42E5CBF9C0F1.pdfhttp://research-ca.bmocapitalmarkets.com/documents/DD7159AE-A658-4206-8552-B704BD39B1B3.pdfhttp://research-ca.bmocapitalmarkets.com/documents/56B0D794-4133-4831-870B-37E573F91F23.pdfhttp://research-ca.bmocapitalmarkets.com/documents/280FF28B-C335-4AED-ADE2-9A751FFD57B7.pdfhttp://research-ca.bmocapitalmarkets.com/documents/F4BF0B3C-974F-46D4-81CF-CEFA948696A0.pdfhttp://research-ca.bmocapitalmarkets.com/documents/01C30C75-5218-49BD-8305-CC034BF9597A.pdfhttp://research-ca.bmocapitalmarkets.com/documents/AFD05602-A3FD-4BE2-A6A3-0B1DEF9BDB6D.pdf8/9/2019 BMO Research Highlights Apr 14
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This report was prepared by an analyst(s) employ d as a research analyst(s) underFINRA rules. For disclosure statements, including
TD Bank(TD-TSX; TD-NYSE)
Stock Rating: OutperformIndustry Rating: Market Perform
Member of: Top 15 Large Cap Stock SelectionsTop 15 Income Stock SelectionsTop 15 Quantitative Stock Selections
April 14, 2010Research CommentToronto, Ontario
John Reucassel, CFABMO Nesbitt Burns Inc.(416) [email protected]: John Fong, CFA, FSA
Price (13-Apr) $74.62 52-Week High $76.9Target Price $80.00 52-Week Low $45.8
Investor Day Focus on Wealth Management
ed by BMO Nesbitt Burns Inc., and who is (are) not registerethe Analyst's Certification, please refer to pages 5 to 8.
3.5
4.0
4.5
5.0
5.5
6.0
6.5
Toronto-Dominion Bank (TD)
Price: High,Low,Close Earnings/Share
30
40
50
60
70
80
Event
TD Bank Financial Group hosted an investor day highlighting its wealthmanagement operations excluding TD Ameritrade.
Impact
Positive. We have argued for over 10 years that that the long-term competitive
advantage in Canadian wealth management will be driven by distribution. By
this metric, TD, through its 1,000-branch network and over 1,400 advisors as
well as dominant discount broker operations, is very well positioned to continue
to grow its share of mutual fund, high net worth and institutional businesses.
Harvesting TDs deep retail deposit base should also provide a steady source of
net flows. Rebounding equity markets should sustain strong earnings growth
through 2010 and 2011 in this segment.
Forecasts
No change.
Valuation
Our $80 target price represents 12.2x our 2011E cash EPS estimate.
Recommendation
TD remains rated Outperform. In addition to rising equity markets, spreads in
wealth management should rise with higher short-term rates. If spreads widenedby 100 basis points (i.e., back to spreads achieved in 2007), NII in the wealth
management segment could rise up to $140mm annually. Overall, a positive
tone to the presentation, which highlighted that even in the face of declining
domestic loan growth in 2010 and 2011, TD has growth opportunities in other
segments.
0
50
100Volume (mln)
0
50
100
2005 2006 2007 2008 200980
100
120TD Relative to S&P/TSX Comp
Last Data Point: April 12, 2010
80
100
120
(FY-Oct.) 2008A 2009A 2010E 2011E
EPS - Cash $5.39 $4.19 $5.70 $6.5P/E 13.1x 11.4
EPS - GAAP $5.00 $3.61 $5.14 $5.9P/E 14.5x 12.5
Cash ROE 16.2% 14.2% 14.8% 15.8%Specific Prov.($mm)$1,063 $2,016 $2,172 $1,285Dividend $2.36 $2.44 $2.44 $2.4Tier One Capital 9.8% 11.3% 11.6% 12.3%
Quarterly EPS - Cash Q1 Q2 Q3 Q
2008A $1.42 $1.24 $1.34 $1.32009A $0.96 $0.82 $1.16 $1.22010E $1.57a $1.37 $1.37 $1.3
Dividend $2.44 Yield 3.3%Book Value $41.86 Price/Book 1.8
Shares O/S (mm) 862.0 Mkt. Cap ($mm) $64,32Float O/S (mm) 862.0 Float Cap ($mm) $64,32Wkly Vol (000s) 17,043 Wkly $ Vol (mm) $1,037.Net Debt ($mm) na Next Rep. Date 27-May (E
Notes: All values in C$; EPS fd; CEPS add back amort. of intang. goodwill; 2006 EPS ex. gain on AMTD & otherMajor Shareholders: Widely heldFirst Call Mean Estimates: TORONTO-DOMINION BANK (C$)2010E: $5.83; 2011E: $6.68
8/9/2019 BMO Research Highlights Apr 14
3/14
Please r cluding the Analyst's Certificatio
Westamerica Bancorp(WABC-OTC)
Stock Rating: Market PerformIndustry Rating: Market Perform
April 13, 20
Ban
Lana Chan Peter J. Wint
BMO Capital Markets Corp. BMO Capital Markets Co212-885-4109 [email protected] [email protected]
Jonathan Katz Virginia Chiare212-885-4066 212-885-41
[email protected] virginia.chiarello@bmo.
Solid 1Q Results, But Growth is Challenging Securities InfoPrice (13-Apr) $58.67 Target Price $552-Wk High/Low $61/$45 Dividend $1Mkt Cap (mm) $1,715 Yield 2.Shs O/S (mm, BASIC) 29.2 Float O/S (mm) 2Options O/S (mm) na ADVol (30-day, 000s)
Price Performance
Event
WABC reported 1Q10 EPS of $0.80 versus $0.76 a year ago. This was in
line with our estimate and a penny above consensus.
efer to pages 7 to 9 for Important Disclosures, in
60
70
80
90
100
110
120
130
140
150
WESTAMERICA BANCORPORATION (WABC)Price: High, Low,Close(US$) Relati ve to S&P 500
ImpactThe results were solid, driven by net interest margin expansion, good
expense control, and stable credit quality trends. The key challenge,
however, remains balance sheet growth as both loans and deposits declined
sequentially. There is also some revenue risk from legislation on NSF fees,
although an economic recovery would benefit other fee income lines. WABC
sports strong capital ratios, positioning it well for acquisitions.
30
40
50
60
70
80
0
5
10
15
Forecasts
We are lowering our EPS estimates to $3.22 (from $3.35) for 2010 and to$3.40 (from $3.65) for 2011. This reflects further contraction in loan
volumes as demand remains weak and competition has increased. Also, we
are factoring in a decline in deposit service charges as a result of legislation
on NSF fees. We are also lowering our fully normalized EPS estimate to
$3.65 (from $3.70).
ValuationWABC shares are trading at 16.1x our fully normalized EPS estimate and
4.7x tangible book value, versus the small-cap bank group medians of 10.5x
and 1.9x.
RecommendationWe maintain our MARKET PERFORM rating, but are adjusting our price
target to $50 (from $51). Our price target is based on a target forward P/E
multiple of 15x (a premium to the small-cap bank group target multiple of
12x) our fully normalized EPS estimate of $3.65, discounted by 10%.
Changes Annual EPS Annual Bk Val/Share Quarterly EPS Target 2010E$3.35to$3.22 2010E$19.22to$19.11 Q2/10E$0.82to$0.80 $51.00to$50.00
2011E$3.65to$3.40 2011E$21.42to$21.08 Q3/10E$0.85to$0.81Q4/10E$0.87to$0.81
2005 20 06 2007 2008 2009
Volume (mln)
Last Data Point: April 12, 2010
Valuation/Financial Data
0
5
10
15
(FY-Dec.) 2009A 2010E 2011E 2012E
EPS Pro Forma $3.15 $3.22 $3.40 nP/E 18.2x 17.3x nFirst Call Cons. $3.24 $3.50 $4.0EPS GAAP $3.15 $3.22 $3.40 n
Bk Val/Share $17.31 $19.11 $21.08 nPrice/Book 3.1x 2.8x nTang. BV/Shr $11.92 $13.78 $15.75 nPrice/TB 4.3x 3.7x n
Quarterly EPS 1Q 2Q 3Q 4Q
2009A $0.80 $0.75 $0.81 $0.72010E $0.80A $0.80 $0.81 $0.8
Balance Sheet Data (31-Mar)ROE 1.99% Exp./Revenues 44.20%ROA 18.80% Net Charge-Offs/Loans 0.65%
NPAs/Loans+OREO 1.63% Tang. Common/Assets 7.92%Reserve/Loans 1.88%
Notes: All values in US$.
Source: BMO Capital Markets estimates, Bloomberg, FactSet, GlobInsight, Reuters, and Thomson Financial.
8/9/2019 BMO Research Highlights Apr 14
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Page 1 April 13, 20
REITs
Industry Rating: Market Perform
April 13, 20
Paul E. Adornato, CFBMO Capital Markets Co
Mark Lutenski Earnest L. Sw212-885-4197 [email protected] earnest.sweat@bmo
Storage to Ride Apartment Bandwagon?Summary
We believe some investors may be buying
storage REITs as a derivative play on the popular
notion that apartment REITs are poised to enjoy
significant rent growth. However, a quick reviewof annual total returns for apartment and storage
REITs (Exhibit 1) shows that in 7 out of 14 years,
the sectors diverged in performance relative to
the REIT Index, meaning one outperformed while
the other underperformed.
We think the link from multifamily to storage is
tenuous at best, and argue that the opposite may
be true as renters who doubled up during the
recession may look to rent a standalone space
again, increasing their personal square footage
and lessening the need for storage.
Storage rents continue to decline versus in-place
rents, implying negative same-store NOI growth
for the next several quarters. While usually a
laggard vs. the CCI, storage REIT performance
has recently jumped ahead, which could be a
reason to take profits, in our view. We still like
industrials as a good substitute for storage and
have OP ratings on DRE, DCT, and FPO.
Included in this report is our proprietary self-
storage survey, which collects rent and discount
data from seven metropolitan areas. We note
that the level of heavy discounts is currently the
highest in the six years we have conducted the
survey. We also observed that rents continue to
decline, but the rate of decrease is less than that
in our two prior surveys.
We believe some investors may be buying storage REITs as a derivative
play on the popular notion that apartment REITs are poised to enjoy
significant rent growth. However, a quick review of annual total returns for
apartment and storage REITs (see Exhibit 1) shows that in 7 out of 14 years,
the sectors diverged in performance relative to the REIT Index, meaning one
outperformed while the other underperformed.
We think the performance of the self-storage group (up 16.1% YTD) is
being driven largely by the belief that storage will benefit as the multifamily
markets recover. However, we think the link to storage is tenuous at best,
and argue that the opposite may be true as renters who doubled up during the
recession may look to rent a standalone space again, increasing their
personal square footage and lessening the need for storage.
Further, storage rental rates continue to decline versus in-place rates,
implying negative same-store NOI growth for the next several quarters.
Looking at year-over-year storage REIT performance versus the consumer
confidence index (CCI) seems to show that storage stocks lag the CCI. Most
recently, storage REIT performance has jumped ahead of the CCI, which
could be a reason to take profits in storage names. We still like industrials as
a good substitute for storage and have OUTPERFORM ratings on DRE,
DCT, and FPO.
Included in this report is our proprietary self-storage survey, which collects
rent and discount data from seven metropolitan areas. We note that the level
of heavy discounts is currently the highest in the six years we have
conducted the survey. We also observed that rents continue to decline, but
the rate of decrease is less than that in our two prior surveys.
Refer to pages 7 to 12 for Important Disclosures, including Analyst's Certification.
8/9/2019 BMO Research Highlights Apr 14
5/14
This report was prepared by an analyst(s) employ d as a research analyst(s) underFINRA rules. For disclosure statements, including
Progress Energy
Resources(PRQ-TSX)Stock Rating: OutperformIndustry Rating: Market Perform
April 13, 2010Research CommentCalgary, Alberta
Mark Leggett, CFA(403) [email protected]: Jason Chang
Montney Drilling SuccessPrice (13-Apr) $12.23 52-Week High $15.2Target Price $15.50 52-Week Low $8.5Event
Progress announced production from the Town South development project was
brought on-stream in late March, increasing total Montney production to ~30
MMcf/d from 8 MMcf/d at the beginning of the year. Four additional horizontal
wells (six to nine fracs per leg) were drilled and completed in Q1/10 ($6.5million per well) with five-day test rates of 4 to 7 MMcf/d. Currently, there are
five horizontal wells on-stream at a combined restricted rate of 20 MMcf/d. An
additional eight to 10 horizontal wells at Town have been budgeted for 2010.
Progress also drilled or recompleted successful vertical delineation wells at
Town, Kobes, Altares, Caribou, Gundy and Lily with test rates averaging 1.5
MMcf/d. An initial pilot program at Kobes has been initiated with two (0.8 net)
wells to be completed in early Q3/10. Progress also expects to initiate three
additional horizontal pilot programs in 2010 as a follow-up to successful vertical
delineation drilling. A 2010 capital budget of $350 million was reiterated.
Progress Energy Resources Corp. (PRQ)Price: High,Low,Close
5
10
15
20
25
5
10
15
20
25
ed by BMO Nesbitt Burns Inc., and who is (are) not registerethe Analyst's Certification, please refer to pages 5 to 8.
Impact
Slightly Positive.
Forecasts
We have adjusted our 2010 production forecast to 40,729 boe/d (down 846
boe/d), while our 2011 production forecast of 47,720 boe/d remains unchanged.
As such, our 2010 CFPS estimate has been slightly lowered to $1.07, while our
2011 CFPS estimate of $1.47 is unchanged.
Valuation
Progress trades at premium 2010E valuation multiples of 11.4x P/CFPS and
14.0x EV/EBITDA. Our target price is supported by our updated sum-of-parts
NAV analysis of $17.07 per share (AECO $5.75/Mcf).Recommendation
We continue to rate Progress shares Outperform. We look for further horizontal
drilling success to enhance visibility on the aerial extent of the companys
Montney acreage. The deep Nikanassin Ojay program represents an operational
catalyst where industry has reported strong drilling results (pg. 3).
0
20
40Volume (mln)
0
20
40
2005 2006 2007 2008 20090
100
200PRQ Relative to S&P/TSX Comp
Last Data Point: April 12, 2010
0
100
200
(FY-Dec.) 2008A 2009A 2010E 2011E
CFPS $1.93 $0.95 $1.07 $1.4P/CFPS 11.4x 8.3
EPS $0.68 -$0.45 -$0.36 -$0.1P/E na n
CF/boe $28.02 $13.07 $14.51 $18.0EV/EBITDA 6.9x 18.9x 14.0x 10.2ROCE 7.0% -5.0% -3.0% -1.0%D/CF 1.6x 3.8x 2.7x 2.7
Quarterly CFPS Q1 Q2 Q3 Q
2008A $0.46 $0.55 $0.50 $0.42009A $0.46 $0.18 $0.12 $0.22010E $0.29 $0.20 $0.25 $0.3Dividend $0.40 Yield 3.3%Book Value $10.38 Price/Book 1.2
Shares O/S (mm) 213.0 Mkt. Cap ($mm) $2,60Float O/S (mm) 170.4 Float Cap ($mm) $2,08Wkly Vol (000s) 3,792 Wkly $ Vol (mm) $45.Net Debt ($mm) $582.1 Next Rep. Date 28-Apr (E
Notes: All values in C$; EPS (dil.), CFPS (dil.); 2008A & bkwd. areProEx; 2009E & fwd. are newco PRQMajor Shareholders: CPPIB (13%)First Call Mean Estimates: PROGRESS ENERGY RESOURCESCORP (C$/CF) 2010E: $1.29; 2011E: $1.54
Changes Annual EPS Annual CFPS Quarterly CFPS2010E-$0.34to-$0.36 2010E$1.10to$1.07 Q1/10E$0.33to$0.29
Q3/10E$0.26to$0.25Q4/10E$0.31to$0.33
8/9/2019 BMO Research Highlights Apr 14
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This report was prepared by an analyst(s) employ d as a research analyst(s) underFINRA rules. For disclosure statements, including
United Company RUSAL(486HK-HKSE)
Stock Rating: Market PerformIndustry Rating: Market Perform
April 13, 2010Research CommentToronto, Ontario
Tony RobsonBMO Nesbitt Burns Inc.(416) [email protected]: Jessica Fung
Price (12-Apr) HKD9.48 52-Week High HKD10.1Target Price HKD9.50 52-Week Low HKD7.3CORRECTION: Target Price Raised to HK$9.50; 2009
Results Slightly Better Than Expected
7.0
7.5
8.0
8.5
9.0
9.5
10.0
United Company RUSAL(HK_486)Price: High,Low,Close
7.0
7.5
8.0
8.5
9.0
9.5
10.
Event
We are issuing this correction to properly reflect the discount to NAV our target
price represents. UC RUSAL reported 2009 underlying net losses of US$397M
or (US$0.03/share), better than BMO Research estimates. Net debt at the end of
2009 was US$13.6B; BMO estimates net debt stood at US$12.9B post IPO.
ed by BMO Nesbitt Burns Inc., and who is (are) not registerethe Analyst's Certification, please refer to pages 4 to 6.
Impact
Slightly positive. Earnings results were in line and net debt levels were lower
than expected by BMO Research. For investors the company continues to be
relatively high risk as cash flow is swept to pay down debt, with little available
for project expenditures. On base case assumptions, BMO estimates the
company would be in a net cash position by 2015.
Forecasts
BMO estimates EPS of US$0.10 in 2010 and US$0.14 in 2011, basically
unchanged. RUSAL continues to guide to a 3% increase in aluminum production
in 2010 over 2009, which BMO estimates at 4.1Mt. Alumina production is now
expected to increase by 11% over 2009 levels, higher than previous guidance of
7% due to increased restarts in production across the board.
Valuation
RUSALs estimated NPV increased by 11% to HK$15.75/share
(US$2.03/share) from HK$14.16/share (US$1.82/share). The valuation increase
is mainly due to an increase in value of RUSALs 25% interest in NorilskNickel, which currently represents approximately 21% of RUSALs gross NPV.
The HK$9.50 target price represents 0.6x NPV.
Recommendation
UC RUSAL is rated Market Perform. The companys large, low-cost operations
remain offset by its high debt position and risky corporate structure.
0
50
100Volume (mln)
0
50
100
Feb Mar Apr2010
98
100
102HK_486 Relative to S&P 500
Last Data Point: April 2, 2010
98
100
102
(FY-Dec.) 2009A 2010E 2011E 2012E
EPS - $0.03 $0.10 $0.14 $0.2P/E 11.9x 9.0x 5.9
CFPS $0.01 $0.15 $0.18 $0.2P/CFPS 8.1x 6.7x 4.7
EV/EBITDA 22.4x 9.2x 7.6x 5.2Aluminum(US$/lb) $0.76 $0.95 $1.00 $1.1Alumina(US$/t) $236 $275 $291 $32R
UB/US$ 31.76 30.00 32.40 34.9
Quarterly EPS H1 H
2009A -$0.07 $0.02010E $0.05 $0.02011E $0.07 $0.0
Dividend $0.00 Yield 0.0%Book Value $0.47 Price/Book 2.6
Shares O/S (mm) 15,136.0 Mkt. Cap (mm) HKD142,27Float O/S (mm) 15,136.0 Float Cap (mm) HKD142,27Wkly Vol (000s) 100,457 Wkly HKD Vol (mm) 47.Net Debt ($mm) $12,900 Next Rep. Date Jul (E
Notes: Share price, market cap. & weekly vol. in HK$, all othervalues in US$Major Shareholders: EN+ Group (47.6%), SUAL (15.9%), Onexim(17.1%), Glencore (8.7%)First Call Mean Estimates: Not Available
Changes Annual EPS Annual CFPS Quarterly EPS Target 2010E$0.11to$0.10 2012E$0.25to$0.26 Q2/10E$0.06to$0.05 HKD9.00toHKD9.50
8/9/2019 BMO Research Highlights Apr 14
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This report was prepared by an analyst(s) employ d as a research analyst(s) underFINRA rules. For disclosure statements, including
Cascades Inc.(CAS-TSX)
Stock Rating: OutperformIndustry Rating: Outperform
April 14, 2010Research CommentMontreal, Quebec
Stephen AtkinsonBMO Nesbitt Burns Inc.(514) [email protected]: Joe Licursi, CMA / David Guenette
Price (13-Apr) $8.12 52-Week High $9.8Target Price $13.50 52-Week Low $2.7Estimates Revised
-0.5
0.
0.
1.
1.
Cascades Inc. (CAS)
Price: High,Low,Close Earnings/Share
ed by BMO Nesbitt Burns Inc., and who is (are) not registerethe Analyst's Certification, please refer to pages 2 to 5.
Event
We are slightly lowering our Cascades estimates to reflect delays in the
implementation of the European and North American price increases.
0
5
10
15
Impact
Neutral.
Forecasts
Packaging continues to be one of our preferred commodities. U.S. boxplant
plus mill inventories fell 97,000 tons in February to a record low 2.123mm tons.
The 10-year average drop in February inventory is 9,000 tons. Year-to-date
demand is up 2% and linerboard exports accounted for 28% of U.S. production.
The US$50/ton price increase is being implemented and contrary to consensus,
we expect the US$60/ton April price increase will hold. We are in line with
2010 estimates (we have also assumed higher wastepaper costs in 2010) but
well above the 2011 First Call Mean.
Valuation
The stock is one of the more inexpensive we follow (currently trading at 4.5x
2011E EV/EBITDA). Our target price of $13.50 represents a relatively low 5.5x
2011E EV/EBITDA.
Recommendation
As of December 31, 2009, liquidity was $540mm mostly comprised of availablelines of credit. We expect Cascades to generate about $254mm in free cash flow
over the next two years. Packaging fundamentals are strong. The main risk to
our forecast is higher wastepaper costs both in packaging (OCC) and in tissue
(SOP-Sorted Office Papers). Our rating is Outperform.
0
10
20Volume (mln)
0
10
20
2005 2006 2007 2008 20090
100
200CAS Relative to S&P/TSX Comp
Last Data Point: April 12, 2010
0
100
200
(FY-Dec.) 2008A 2009A 2010E 2011E
EPS -$0.02 $1.12 $0.78 $1.26P/E 10.7x 6.4
CFPS $1.57 $3.09 $2.91 $3.3P/CFPS 2.8x 2.4
EV/EBITDA 8.5x 5.0x 5.3x 4.3ROE nm 9% 6% 9%Gross Margin 8% 12% 10% 12%FCF -$83 $166 $119 $13
Quarterly EPS Q1 Q2 Q3 Q
2008A -$0.09 -$0.11 $0.06 $0.12009A $0.21 $0.28 $0.36 $0.22010E $0.07 $0.12 $0.31 $0.2
Dividend $0.16 Yield 2.0%Book Value $13.41 Price/Book 0.6
Shares O/S (mm) 97.7 Mkt. Cap ($mm) $79Float O/S (mm) 72.8 Float Cap ($mm) $59Wkly Vol (000s) 1,348 Wkly $ Vol (mm) $9.Net Debt ($mm) $1,533.0 Next Rep. Date April (E
Notes: All values in C$Major Shareholders: Bernard Lemaire (13.91%); Laurent Lemaire(11.5%)First Call Mean Estimates: CASCADES INCORPORATED (C$)2010E: $0.77; 2011E: $0.97
Changes Annual EPS Annual CFPS Quarterly EPS2010E$0.81to$0.78 2010E$2.94to$2.91 Q1/10E$0.15to$0.072011E$1.32to$1.26 2011E$3.40to$3.34 Q2/10E$0.15to$0.12
Q3/10E$0.23to$0.31
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Page 1
Toys & Juvenile Products
Industry Rating: Outperform
April 14, 20
Gerrick L. Johnson, CM
BMO Capital Markets [email protected]
1Q10 Preview: Toys & Juvenile Products StillPerforming Well
Summary
We are still bullish on stocks in the toy and
juvenile products space.
We believe the toy and juvenile products
industries are outperforming other segments of
the consumer economy.
We anticipate that most companies in our
coverage will exceed Street EPS expectations.
An earlier Easter may have benefitted the
companies we cover.
The Easter shift should provide marginal benefit
to manufacturers with a bigger impact for
companies with retail operations (CRI, BBW,
MATs American Girl).
Retail inventories remain lean and input costs are
significantly higher on a year-over-year basis,
which could cause some concern for investors.
We expect companies under coverage to again
exhibit good operating cost control.
Our favorite names in the space continue to be
MAT, CRI, and LF.
Toy & Juvenile Product stocks have had a very good run, outperforming the
broader market so far in 2010. We are still bullish on these child-facing
industries. We believe that the toy and juvenile products industries are
performing better than other sectors of the consumer economy, particularly
those of other discretionary consumer products. We think these companieswill continue to generate better-than-expected financial results through 2010,
and we believe these stocks will continue to outperform the market over the
next 12 months.
While we are looking for the companies we cover to report 1Q10 sales and
earnings that generally exceed current Street expectations, we are mindful of
current valuations (~12.5x for the group, which is pushing past the historical
average) and the recent appreciation of these stocks (+23% ytd vs +7% for
S&P 500). Should concerns arise on conference calls, or profit-taking occur,
triggering sell-offs in these stocks, we would likely consider such sell-offs as
buying opportunities.
Some commentary that could concern investors, despite strong numbers and
good consumer demand, could be regarding retail inventories and input
costs. We think retail inventories remain lean, and those who are anticipating
big shipments to replenish depleted inventories at retail may come away
disappointed. Also, key input costs like resin, paper, and zinc are showing
sizable year-over-year increases and could begin to flow through cost of
good sold over the next several quarters, giving rise to gross margin
compression warnings, despite strong cost controls.
13-Apr EPS P/E Mkt CapToys Rating Price Target 2009E 2010E 2011E 2009E 2010E 2011E Div Yld Book ($mm
Build-A-Bear Workshop (BBW) Outperform $7.31 $6 -$0.16 $0.30 $0.50 nm 24.4 14.6 $0.00 0.0% $8.03 149Carter's (CRI) Outperform $31.73 $35 $2.15 $2.43 $2.70 14.8 13.1 11.8 $0.00 0.0% $9.57 1,868Hasbro (HAS) Market Perform $39.31 $34 $2.48 $2.45 $2.75 15.9 16.0 14.3 $1.00 2.5% $11.63 5,361JAKKS Pacific (JAKK) Market Perform $14.41 $13 $1.04 $1.15 $1.30 13.9 12.5 11.1 $0.00 0.0% $13.09 402LeapFrog (LF) Outperform $6.50 $7 -$0.04 $0.45 $0.60 nm 14.4 10.8 $0.00 0.0% $2.50 416Mattel (MAT) Outperform $23.46 $27 $1.37 $1.55 $1.80 17.1 15.1 13.0 $0.75 3.2% $6.99 8,531Mega Brands (MB) Market Perform $0.44 $0 na na na na na na $0.00 0.0% -$8.12 16RC2 (RCRC) Market Perform $16.17 $15 $1.39 $1.35 $1.45 11.6 12.0 11.2 $0.00 0.0% $11.01 346
Source: BMO Capital Markets estimates and company reports.
April 14, 20
Refer to pages 7 to 8 for Important Disclosures, including Analyst's Certification.
8/9/2019 BMO Research Highlights Apr 14
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Please r cluding the Analyst's Certificatio
Electronics for Imaging(EFII-OTC)
Stock Rating: Market PerformIndustry Rating: Market Perform
April 13, 20
Enterprise Hardware & Imagin
Keith Bachm
BMO Capital Markets Co212-885-40
Corey Meehan Jung Pa212-885-4026 213-228-25
[email protected] [email protected]
Securities InfoPrice (13-Apr) $12.04 Target Price $152-Wk High/Low $14/$9 Dividend Mkt Cap (mm) $540 Yield Shs O/S (mm, BASIC) 44.9 Float O/S (mm) 4Options O/S (mm) na ADVol (30-day, 000s)
Price Performance
Better, In the Stock
Event
We attended a large international sign expo last week that made us more
confident on EFIs inkjet business. We believe end-user demand is
improving, which should be a near-term positive for ink sales. However, we
believe hesitancy toward large printer purchases remains.
60
80
100
120
140
160
ELECTRONICS FOR IMAGING INC (EFII)Price: High,Lo w, Close( US$) Relative to S&P 500
5
10
15
20
25
30
ImpactPositive We are increasing our CY2010 and CY2011 revenue and EPS
estimates based on better-than-expected end-user demand. For the March
quarter, we believe our $106.5 million revenue and roughly break-even EPS
estimates are reasonable and expect any upside to revenues to come from
stronger-than-expected ink sales.0
20
40
0
20
40
efer to pages 6 to 9 for Important Disclosures, in
2005 2006 2007 2008 2009
Volume (mln)
Last Data Point: April 12, 2010
Valuation/Financial Data
(FY-Dec.) 2008A 2009A 2010E 2011
EPS Pro Forma $0.73 -$0.22 $0.34 $0.6P/E 35.4x 18.0First Call Cons. $0.34 $0.72
EPS GAAP -$0.24 -$0.07 -$0.73 -$0.2
FCF $0.28 -$0.57 $0.25 $0.6P/FCF 48.2x 20.1EBITDA ($mm) $83 $12 $40 $5EV/EBITDA 5.7x 3.9Rev. ($mm) $560 $401 $470 $52
EV/Rev 0.5x 0.4
Quarterly EPS 1Q 2Q 3Q 4Q
ForecastsFor CY2010, we are increasing our EPS estimate to $0.34 from $0.32
(consensus - $0.33). For CY2011, we are increasing our EPS estimate to
$0.67 from $0.63 (consensus - $0.72).
ValuationWe are increasing our target price to $12.50 from $12, which is based off
11x-12x our CY2011 EPS estimate, minus interest income, plus cash.
2009A -$0.08 -$0.12 -$0.05 $0.02010E $0.00 $0.05 $0.09 $0.1
Balance Sheet Data (12/31/09)
Net Debt ($mm) -$310 TotalDebt/EBITDA nmTotal Debt ($mm) -$240 EBITDA/IntExp nNet Debt/Cap. nm Price/Book 1.0
Notes: All values in US$.
Source: BMO Capital Markets estimates, Bloomberg, FactSet, GlobInsight, Reuters, and Thomson Financial.
Recommendation
We remain MARKET PERFORM rated. We believe a healthy recovery ofinkjet sales is already priced into the stock. We do not see enough earnings
growth to move EFI materially higher from its current levels.
Changes Annual EPS Annual FCF Quarterly EPS Target 2010E$0.32to$0.34 2010E$0.04to$0.25 Q4/10E$0.18to$0.19 $12.00to$12.50
2011E$0.63to$0.67 2011E$0.30to$0.60
8/9/2019 BMO Research Highlights Apr 14
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Please r cluding the Analyst's Certificatio
Qualcomm(QCOM-NASDAQ)
Stock Rating: OutperformIndustry Rating: Market Perform
April 13, 20
Communications Equipme
Tim Lo
BMO Capital Markets Co212-885-41
Kevin Manning Ari Kle212-885-4102 212-885-41
[email protected] [email protected]
Securities InfoPrice (13-Apr) $42.30 Target Price $52-Wk High/Low $50/$35 Dividend $0Mkt Cap (mm) $71,089 Yield 1.Shs O/S (mm, BASIC) 1,681 Float O/S (mm) 1,6Options O/S (mm) na ADVol (30-day, 000s) 25,7
Price Performance
Tweaking Numbers Ahead of Quarter; ExpectConservative Guidance
Event
We are raising our numbers slightly as we wrap up the handset market
following Q1. We believe CDMA/WCDMA units were better than we had
expected and ASP pressure has stabilized. We raise our March estimates
within the pre-announced range, but our higher numbers for June are a penny
below consensus. In general, we believe the device unit environment is
positive and ASPs are stabilizing. We are expecting a strong second half of
2010, with MSM growth accelerating, and device units potentially coming in
above guidance. We believe management may begin to provide less clarity,
particularly for ASPs, which may be an issue for some investors.
80
90
100
110
120
130
140
150
160
170
QUALCOMM INC (QCOM)Price: High, Low,Close(US$) Relati ve to S&P 500
15
20
25
30
35
40
45
50
55
60
0
500
1000
0
500
100
efer to pages 4 to 6 for Important Disclosures, in
ImpactNeutral. We believe QCOM will speak more positively about device
volumes, which should quell some of the ASP concerns. We maintain our
OUTPERFORM rating despite the fact that June-quarter guidance may fall
below current consensus.
2005 20 06 2007 2008 2009
Volume (mln)
Last Data Point: April 12, 2010
Valuation/Financial Data
(FY-Sep.) 2008A 2009A 2010E 2011E
EPS Pro Forma $2.25 $1.90 $2.29 $2.5P/E 18.5x 16.4First Call Cons. $2.30 $2.5
EPS GAAP $1.85 $1.47 $1.82 $1.8
FCF $1.30 $3.85 $2.10 $2.2P/FCF 20.1x 19.0EBITDA ($mm) $4,603 $4,166 $4,236 $4,90EV/EBITDA 21.3x 18.3Rev. ($mm) $11,130 $10,385 $10,635 $11,74EV/Rev 8.5x 7.7
Quarterly EPS 1Q 2Q 3Q 4Q
ForecastsWe are raising our FY2010/2011 pro forma EPS estimates from $2.24/$2.55
to $2.29/$2.58
2009A $0.31 $0.41 $0.54 $0.62010E $0.62A $0.57 $0.52 $0.56
Balance Sheet Data (12/31/09)
Net Debt ($mm) $18,928 TotalDebt/EBITDA 0.0Total Debt ($mm) $199 EBITDA/IntExp nNet Debt/Cap. 92.3% Price/Book 3.3
Notes: All values in US$.
Source: BMO Capital Markets estimates, Bloomberg, FactSet, GlobInsight, Reuters, and Thomson Financial.
Valuation
Our price target of $54 assumes that the stock trades at 20x our pro formaEPS estimate for CY2011
Recommendation
We rate QCOM OUTPERFORM.
Changes Annual EPS Annual FCF Quarterly EPS2010E$2.24to$2.29 2010E$1.85to$2.10 Q2/10E$0.55to$0.572011E$2.55to$2.58 2011E$1.88to$2.23
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Page 1 April 13, 20
Communications
Equipment
Industry Rating: Market Perform
April 13, 20
Tim Lon
BMO Capital Markets [email protected]
Kevin Manning Ari Kle212-885-4102 [email protected] [email protected]
Summary
We expect solid results from the handset segment in the
March quarter, likely beating our better-than-seasonal
estimate. Our global model calls for 345.5M units
(including white box), down 9.3% Q/Q and up 28.5%
Y/Y. We think seasonality is becoming less of a factor
as emerging markets have grown.
We are modeling a typical 2Q, with units up 3.6% Q/Q
to 358M phones.
We expect most of our companies to report March-
quarter results around consensus. Guidance should be
more mixed as the industry has become more
competitive.
We have an OUTPERFORM rating on QCOM. They
preannounced positively, and we raised our estimatestoday based on positive WCDMA/CDMA checks for the
March quarter.
We have MARKET PERFORM ratings on NOK, MOT,
ERIC, NVTL, and SWIR. We need to see signs of high-
end Smartphones and improved OS from NOK, more
Android devices for MOT and are concerned about
integration and the infrastructure market for ERIC. We
have a longer-term downward basis for both SWIR and
NVTL owing to competitive issues.
Wireless Earnings PreviewWe expect a decent quarter for the handset space, with overall industry units
likely beating our better than seasonal 9% Q/Q decrease. QCOM and RIMM
are our only positive ratings in wireless.
QUALCOMM reports on 4/21. QCOM recently provided positive
EPS and revenue guidance, although it did not update units and
ASP estimates. Today, we raised our QCOM estimates owing to
positive checks on March-quarter WCDMA/CDMA units and ASPs
(see our separate QCOM note). We rate QCOM OUTPERFORM.
Nokia reports on 4/22. We believe units could beat our estimate for
the quarter at the low end, but dont see the potential for a recovery
until Smartphone strategy improves, likely now not until 3Q. We
rate NOK MARKET PERFORM.
Sony Ericsson reports on 4/16 and Ericsson on 4/23. SEMC andST-Ericsson should continue to adversely affect results. We rate the
shares MARKET PERFORM.
Motorola reports on 4/29. Focus should be on handset results and
Android units, ASPs, margins, device launches and the spinoff. We
rate MOT MARKET PERFORM.
Sierra Wireless is expected to reports the week of 5/3. We are in
line with consensus for 4Q. We are below consensus for 2Q as we
expect greater competition and margin pressure to negatively affect
results. We rate SWIR MARKET PERFORM.
Novatel Wireless is expected to reports the week of 5/10. Webelieve results will be in line with consensus. Our 2Q estimates are
below consensus. We rate NVTL MARKET PERFORM.
Refer to pages 25 to 26 for Important Disclosures, including Analyst's Certification.
8/9/2019 BMO Research Highlights Apr 14
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Please r cluding the Analyst's Certificatio
Intel(INTC-NASDAQ)
Stock Rating: OutperformIndustry Rating: Market Perform
April 14, 20
Semiconducto
Ambrish Srivastava, Ph
BMO Capital Markets Co415-591-21
Emily Scudd415-591-21
Not Your Fathers Intel Securities InfoPrice (13-Apr) $22.76 Target Price $252-Wk High/Low $23/$15 Dividend $0Mkt Cap (mm) $125,726 Yield 2.Shs O/S (mm, BASIC) 5,524 Float O/S (mm) 5,Options O/S (mm) na ADVol (30-day, 000s) 53,8
Selected Bond Iss
Event
Margins are not collapsing, and appear to be headed higher. And boy, it is
nice to not ask for a multiple expansion on a stock for it to work. Inteldelivered very strong results for 1Q with guidance slightly better than
seasonal. 1Q EPS came in at $0.43 vs. our $0.36 estimate and revenues were
$10.3 billion vs. $9.7 billion, down 3% q-q, better than seasonal aided
largely by sequentially better ASPs.
efer to pages 8 to 10 for Important Disclosures, in
ImpactQuite positive. The bears on INTC would have you sell the stock the moment
margins hit 60%, which was in 4Q09. Our investment case for INTC has
been predicated on our view that the company can sustain margins in the
60%'s longer, given a reduced cost structure and better mix. Intel is
delivering on that front, and then some, in our view. Margins for the year arenow expected to be at 64% vs. prior guidance of 61%. Inventory appears lean
as well, including on Intels balance sheet, where inventory stayed essentially
flat. On the top-line front, Intel is showing some early signs of a corporate
recovery in its non-server business.
ForecastsOur 2011 estimates get pulled in to 2010. We are raising 2010 to $1.85 vs.
$1.70 (consensus $1.68) and 2011 goes to $2.00 vs. $1.85 (consensus $1.83).
Valuation
We are raising our price target to $28 from $26 based on a P/E multiple of
14x our 2011 EPS estimate of $2.00.
Recommendation
We rate INTC shares OUTPERFORM.
Changes Annual EPS Annual FCF Quarterly EPS Target 2010E$1.70to$1.85 2010E$2.01to$1.87 Q2/10E$0.38to$0.42 $26.00to$28.00
2011E$1.85to$2.00 2011E$1.96to$2.11 Q3/10E$0.46to$0.47Q4/10E$0.50to$0.52
Ind Prc Ratg Mdys/S&P YTW SpreINTC 2.95% '35 99 na / A- 3.01% -169
INTC 3.25 '39 121 A2 / A- 2.24% -246Bond data from Bloomberg.
Price Performance
60
70
80
90
100
110
120
INTEL CORP (INTC)
Price: High, Low,Close(US$) Rel at ive to S&P 500
10
15
20
25
30
0
1000
2000
3000
0
10
20
30
2005 2006 2007 2008 20 09
Volume (mln)
Last Data Point: April 12, 2010
Valuation/Financial Data
(FY-Dec.) 2008A 2009A 2010E 2011E
EPS GAAP $0.92 $0.78 $1.85 $2.0P/E 12.3x 11.4First Call Cons. $1.68 $1.8
FCF $1.00 $1.18 $1.87 $2.1P/FCF 12.2x 10.8EBITDA ($mm) $14,276 $13,691 $19,784 $21,20EV/EBITDA 5.7x 5.3Rev. ($mm) $37,586 $35,127 $43,091 $45,99EV/Rev 2.6x 2.5
Quarterly EPS 1Q 2Q 3Q 4Q
2009A $0.11 -$0.07 $0.33 $0.42010E $0.43A $0.42 $0.47 $0.52
Balance Sheet Data (12/31/09)Net Debt ($mm) -$12,472 TotalDebt/EBITDA 0.1Total Debt ($mm) $2,221 EBITDA/IntExp nNet Debt/Cap. nm Price/Book 3.0
Notes: All values in US$.
Source: BMO Capital Markets estimates, Bloomberg, FactSet, GlobInsight, Reuters, and Thomson Financial.
8/9/2019 BMO Research Highlights Apr 14
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Important DisclosuresAnalyst's Certification
As to each company covered in this report, the analyst hereby certifies that the views expressed in this report accurately reflect my personal views aboutthe subject securities or issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specificrecommendations or views expressed in this report.
Analysts who prepared this report are compensated based upon (among other factors) the overall profitability of BMO Capital Markets and their
affiliates, which includes the overall profitability of investment banking services. Compensation for research is based on effectiveness in generatingnew ideas and in communication of ideas to clients, performance of recommendations, accuracy of earnings estimates, and service to clients.
Analysts employed by BMO Nesbitt Burns Inc. and/or BMO Capital Markets Ltd. are not registered as research analysts with FINRA. These analystsmay not be associated persons of BMO Capital Markets Corp. and therefore may not be subject to the NASD Rule 2711 and NYSE Rule 472
restrictions on communications with a subject company, public appearances and trading securities held by a research analyst account.
Company Specific Disclosures
For Important Disclosures on the stocks discussed in this report, please go http://researchglobal.bmocapitalmarkets.com/Company_Disclosure_Public.asp.
Distribution of Ratings (Dec. 31, 2009)
Rating
Category BMO Rating
BMOCM US
Universe*
BMOCM US
IB Clients**
BMOCM US
IB Clients***
BMOCM
Universe****
BMOCM
IB Clients*****
First Call
Universe
Buy Outperform 32.2% 12.3% 38.3% 36.1% 47.9% 50%
Hold Market Perform 62.6% 10.2% 61.7% 56.9% 48.9% 43%
Sell Underperform 5.3% 0% 0% 6.9% 3.2% 7%
* Reflects rating distribution of all companies covered by BMO Capital Markets Corp. equity research analysts.** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking services a
percentage within ratings category.*** Reflects rating distribution of all companies from which BMO Capital Markets Corp. has received compensation for Investment Banking
services as percentage of Investment Banking clients.**** Reflects rating distribution of all companies covered by BMO Capital Markets equity research analysts.***** Reflects rating distribution of all companies from which BMO Capital Markets has received compensation for Investment Banking services as
percentage of Investment Banking clients.
Ratings and Sector Key
We use the following ratings system definitions:OP = Outperform - Forecast to outperform the market;
Mkt = Market Perform - Forecast to perform roughly in line with the market;Und = Underperform - Forecast to underperform the market;(S) = speculative investment;NR = No rating at this time;
R = Restricted Dissemination of research is currently restricted.
Market performance is measured by a benchmark index such as the S&P/TSX Composite Index, S&P 500, Nasdaq Composite, as appropriate for eachcompany. BMO Capital Markets eight Top 15 lists guide investors to our best ideas according to different objectives (Canadian large, small, growth,value, income, quantitative; and US large, US small) have replaced the Top Pick rating.
Other Important Disclosures
For Other Important Disclosures on the stocks discussed in this report, please go to http://researchglobal.bmocapitalmarkets.com/Company_Disclosure_Public.asp or write to Editorial Department, BMO Capital Markets, 3 Times Square, New York, NY 10036 or Editorial Department, BMO CapitaMarkets, 1 First Canadian Place, Toronto, Ontario, M5X 1H3.
Prior BMO Capital Markets Ratings Systems
http://researchglobal.bmocapitalmarkets.com/documents/2009/prior_rating_systems.pdf
Dissemination of Research
Our research publications are available via our web site http://bmocapitalmarkets.com/research/. Institutional clients may also receive our research viaFIRST CALL, FIRST CALL Research Direct, Reuters, Bloomberg, FactSet, Capital IQ, and TheMarkets.com. All of our research is made widely
available at the same time to all BMO Capital Markets client groups entitled to our research. Additional dissemination may occur via email or regularmail. Please contact your investment advisor or institutional salesperson for more information.
Conflict Statement
A general description of how BMO Financial Group identifies and manages conflicts of interest is contained in our public facing policy for managing
conflicts of interest in connection with investment research which is available at http://researchglobal.bmocapitalmarkets.com/Conflict_Statement_Public.asp.
General Disclaimer
BMO Capital Markets is a trade name used by the BMO Investment Banking Group, which includes the wholesale arm of Bank of Montreal and its
subsidiaries BMO Nesbitt Burns Inc. and BMO Nesbitt Burns Lte./Ltd., BMO Capital Markets Ltd. in the U.K. and BMO Capital Markets Corp. in theU.S. BMO Nesbitt Burns Inc., BMO Capital Markets Ltd. and BMO Capital Markets Corp are affiliates. Bank of Montreal or its subsidiaries (BMO
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BMO Capital Markets
Financial Group) has lending arrangements with, or provide other remunerated services to, many issuers covered by BMO Capital Markets. The
opinions, estimates and projections contained in this report are those of BMO Capital Markets as of the date of this report and are subject to changewithout notice. BMO Capital Markets endeavours to ensure that the contents have been compiled or derived from sources that we believe are reliableand contain information and opinions that are accurate and complete. However, BMO Capital Markets makes no representation or warranty, express or
implied, in respect thereof, takes no responsibility for any errors and omissions contained herein and accepts no liability whatsoever for any loss arisingfrom any use of, or reliance on, this report or its contents. Information may be available to BMO Capital Markets or its affiliates that is not reflected inthis report. The information in this report is not intended to be used as the primary basis of investment decisions, and because of individual clienobjectives, should not be construed as advice designed to meet the particular investment needs of any investor. This material is for information purposes
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To U.K. Residents: In the UK this document is published by BMO Capital Markets Limited which is authorised and regulated by the FinanciaServices Authority. The contents hereof are intended solely for the use of, and may only be issued or passed on to, (I) persons who have professiona
experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order2005 (the Order) or (II) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together referred to as relevantpersons). The contents hereof are not intended for the use of and may not be issued or passed on to, retail clients.
ADDITIONAL INFORMATION IS AVAILABLE UPON REQUESTBMO Financial Group (NYSE, TSX: BMO) is an integrated financial services provider offering a range of retail banking, wealth management, and investment ancorporate banking products. BMO serves Canadian retail clients through BMO Bank of Montreal and BMO Nesbitt Burns. In the United States, retail clients ar
served through Harris N.A. Investment and corporate banking services are provided in Canada and the US through BMO Capital Markets.BMO Capital Markets is a trade name used by BMO Financial Group for the wholesale banking businesses of Bank of Montreal, Harris N.A. and BMOIreland Plc, and the institutional broker dealer businesses of BMO Capital Markets Corp. (Member SIPC), BMO Nesbitt Burns Trading Corp. and BMOCapital Markets GKST Inc. (Member SIPC) in the U.S., BMO Nesbitt Burns Inc. (Member CIPF) in Canada, Europe and Asia, BMO Nesbitt Burns SecuritieLimited (U.S. registered and member of FINRA), and BMO Nesbitt Burns Lte/Ltd. (Member CIPF) in Canada, and BMO Capital Markets Limited in Europand Australia. Nesbitt Burns is a registered trademark of BMO Nesbitt Burns Corporation Limited, used under license. BMO Capital Markets istrademark of Bank of Montreal, used under license. "BMO (M-Bar roundel symbol)" is a registered trademark of Bank of Montreal, used under license.
Registered trademark of Bank of Montreal in the United States, Canada and elsewhere.TM Trademark Bank of Montreal
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