Inside the Market’s roundup of some of today’s key analyst actions
Believing a “tactical upgrade makes sense at this trading level,” National Bank Financial analyst Maxim Sytchev has turned bullish on Finning International Inc. (FTT-T) following 9.2-per-cent drop in share price on Wednesday, raising his recommendation to “outperform” from “sector perform” previously.
The Vancouver-based heavy equipment dealer received a rough reaction from investors to the release of its fourth-quarter 2023 financial results, which included revenue of $2.403-billion, up 1 per cent year-over-year but falling 4 per cent below the Street’s expectation of $2.499-billion. Adjusted earnings per share of 96 cents was penny below the consensus forecast.
“While we are reluctant to rethink our structural positioning re peak EPS risks, macro, etc., we also don’t want to waste an opportunity for a 15-per-cent-plus return as it’s unlikely that: 1) we have another barely positive Product Support (PS) print (or Canada being down, again); 2) Argentina write-down is behind us as is IT intangible compression; 3) market is aware of pricing moderation when it comes to used equipment; 4) market downdraft (if it ever comes) should be less pronounced for a name that has already been beaten down; 5) shares of FTT are now getting close to oversold levels on RSI and historically they don’t stay there for long, unless we are upon material negative earnings revisions which does not seem to the be case,” said Mr. Sytchev.
Seeing the reaction as a “short-term disappointment,” Mr. Sytchev emphasize Finning is a “structurally higher earnings per share/free cash flow-generative entity” than in the past.
“Previously, trough was $1.00, peak $2.00,” he said. “Now, peak is $4.00 and let’s say for the sake of argument, trough is $2.00 (to be conservative). Under prior regime, we got to $37 peak (implying 25 times P/E multiple on normalized earnings); now at $3.00 in “new” mid-cycle EPS generation, investors are paying 12 times P/E, implying materially more upside from current levels on multiple expansion. In the short-term, we don’t see EPS collapsing, so a rerate on static EPS is likely, presenting a trading opportunity in our view. While we are calling the upgrade ‘tactical’, we want to have an open mind as new info comes in around commodity pricing, cycling duration. We therefore now rate Finning shares Outperform.”
The analyst maintained a target of $46 per share. The current average on the Street is $46.89, according to Refinitiv data.
“Our numbers remain largely unchanged for the upcoming quarter, except for adjustments related to product support revenue (near-term),” he concluded. “Even though management reiterated investor day targets on the call of 7-per-cent CAGR [compound annual growth rate] for product support till 2025, we moderated the climb after the recent quarter. Our 2024 growth assumptions might be conservative given the pace of New equipment deliveries and backlog growth, but we are cautious in light of commodities volatility and tougher comps in terms of deliveries. We still anticipate 4.8-per-cent year-over-year growth for Product Support through 2025 (from 7 per cent previously) and a mid-teens after-tax ROIC.”
Other analysts making changes include:
* CIBC’s Jacob Bout to $46 from $48 with an “outperformer” rating.
“While FTT reported relatively in-line Q4/23 earnings, the quarter showcased a deceleration of product support growth and lower equipment backlog,” said Mr. Bout. “Despite this, FTT still sees 2024 being a moderating but steady growth year. Product support growth should recover (oilsands activity returned back to normal in January and construction-related work should recover over the year). While backlog levels are lower, this is mostly due to the normalization of the supply chain. Overall, we have trimmed our 2024/2025 adj. EPS estimates slightly to reflect more conservative revenue growth assumptions.”
* RBC’s Sabahat Khan to $45 from $50 with an “outperform” rating.
=====
While its third-quarter results topped his expectations, Scotia Capital analyst Michael Doumet downgraded ATS Corp. (ATS-T) to “sector perform” from “sector outperform” previously, believing its shares are fairly valued and preferring to “look for a more attractive entry point.”
“ATS has gone through a transformation in the last few years — becoming an undisputed earnings compounder,” he said. “However, we believe organic growth, which has been accelerated via-outsized growth in Transportation, is at risk of normalizing in the NTM [next 12 months]. And, while the delayed EV order ($200 million) is expected to restart in 1QF25, we expect consolidated organic growth in F25 to be flattish — if not at risk of declining if EV orders continue to be deferred. Additionally, we believe this ‘stop-start’ with large EV orders will lead to variability in labour utilization, and therefore, margin pressure.
“In the last six months, we believe the bull/bear thesis has reflected the push/pull on sentiment between the potential normalization of EV sales and the growth of GLP1/Life Sciences. In the next few quarters, we believe the risks in EV sales are greater and, as such, believe the perception of ATS’s earnings base will need to be reset lower in the near-term.”
On Wednesday before the bell, the Cambridge, Ont.-based industrial automation systems manufacturer reported sales of $752-million, up 16.2 per cent and above Mr. Doumet’s $727-million estimate. Earnings per share of 65 cents fell in line with expectations.
“ATS’s growing EV business has been one of its major recent successes. In the last two years, Transportation sales grew from $280 million to $910 million,” the analyst said. “That organic growth of $630 million has outstripped the company’s consolidated organic growth (on a dollar basis) during the period. To be fair, Life Sciences had grown rapidly prior to the two-year period — and in the last two years, growth had normalized. Now, with GLP1s accelerating, ATS’s Life Science organic growth is likely to get a shot in the arm. However, similar to the last two years, we think EVs will have a greater directional weight on revenue growth — and, as such, believe the risk to organic growth is to the downside.
“Due to lower-than-expected uptake in EVs, OEMs have been reducing or postponing EV-related capex. In the quarter, ATS noted that $200 million of order backlog from one EV customer was delayed — so far, into 1QF25. The delay reduced the revenue expectation for 4QF24. It is also expected to weigh on margins due to the reduced labour utilization (we estimate a 130 basis points headwind to gross margins in 4QF24). ATS expects the delayed program to restart in 1QF25. As highlighted in our previous research, we believe the normalization in EV could represent a more than 6-per-cent headwind to organic growth. Meanwhile, we believe growth from GLP1s will be less than 5 per cent.”
With the expectation, Mr. Doumet lowered his target to $61 from $64. The average on the Street is $66.14.
Elsewhere, others making changes include:
* Stifel’s Justin Keywood to $73 from $75 with a “buy” rating.
“ATS reported mixed FQ3 results with solid sales growth and FCF generation with some margin expansion, " he said. “However, bookings missed our estimate and a range we would consider to be adequate with a significant, (85-per-cent) contraction in EV
“ATS’ shares were slightly elevated, heading into FQ3 on the back of buzz within the GLP-1 space, which continues to be a substantial opportunity. We remain bullish on ATS, especially upon M&A with a track record to support value creation, including ROIC expansion, along with a diversification opportunity from EV and one large customer.”
* National Bank’s Maxim Sytchev to $65 from $69 with an “outperform” rating.
“With a number of investors staying away on concerns of book-to-bill slipping below 1.0 times (we were at 0.9 times in the Q), we don’t believe there was aggressive positioning on the part of investors, especially in light of ROK’s underwhelming results,” said Mr. Sytchev. “Perhaps that better explains the better than feared reaction to [Wednesday’s] outlook, which, objectively, was a negative surprise but at least had a time frame associated with it – restart for the EV order in June 2024 quarter (according to management). Overall, we do believe we are going to see the resumption of EV momentum as OEMs figure out the pace of capacity additions. Healthcare is a strong vertical for the company as are Food and Nuclear. Net net, the EV overhang is not removed but arguably has become more acute in the short term.”
* Raymond James’ Michael Glen to $65 from $61 with an “outperform” rating.
=====
Citing “improved visibility” surrounding its carbon credit diversification strategies, Raymond James analyst Daryl Swetlishoff upgraded Acadian Timber Corp. (ADN-T) to “outperform” from “market perform” following in-line fourth-quarter results.
“We highlight Acadian has executed on its first carbon credit sale in 4Q23, realizing attractive US$24.85/credit pricing (in line with prior guidance) on a small 1.5k transaction,” he said. “While clearly not needle-moving, we note 1.9 million carbon credits are expected to be realized and sold through the 10-yr lifetime of the project – with the bulk of transactions expected within the early stages of the initiative. Should all 1.9 million credits transact at this level, we note this translates to a $64.7-million valuation of the project (23 per cent of current market cap).”
Also pointing to its “constructive” long term outlook for the U.S. housing industry and seeing “additional diversification on tap” following Acadian’s announcement of a solar land lease agreement, Mr. Swetlishoff raised his target for its shares to $18.50 from $17, calling its financial position “solid” and supported by “stable” free cash flow generation. The average on the Street is $17.50.
=====
National Bank Financial analyst Matt Kornack called the fourth-quarter 2023 financial results from First Capital Real Estate Investment Trust (FCR.UN-T) “a solid end to the year as retail fundamentals remained supportive of continued rent spread expansion, despite some fixed rate renewals.”
The Toronto-based REIT reported funds from operations of 27 cents for the quarter, down from 37 cents during the same period a year ago. However, adjusted for recoveries and termination income, it came in at 32 cents, a penny above Mr. Kornack’s estimate and 2 cents above the Street’s expectations.
Total occupancy rose 0.3 per cent sequentially and 0.4 per cent year-over-year to 96.2 per cent, topping the analyst’s projection of $96.0 per cent. Both headline net operating income and EBITDA also narrowly beat the Street’s forecast.
“The REIT’s capital allocation plan, with a focus on low cap rate dispositions and de-leveraging has aided near-term FFO/unit figures (a positive differentiator vs. peers with larger development delivery schedules),” said Mr. Kornack. “Our outlook for growth in 2024 on a per-unit basis remains constructive on the back of further accretive disposition activity, lease-up at One Bloor and sustained occupancy/rent growth trajectories.”
Reiterating his “outperform” recommendation, he raised his target for First Capital units to $17.50 from $17. The average is $17.25.
Elsewhere, TD Securities’ Sam Damiani downgraded the shares to “buy” from “action list buy” with a $19 target.
Other analyst changes include:
* Scotia’s Mario Saric to $17.25 from $16.50 with a “sector perform” rating.
“FCR is trending positively, with the main question = has enough been priced in for now? (FCR implied cap spread to its unsecured debt YTM is below average; that said, it was essentially 0 at Q3 results as the debt YTM has fallen 110 basis points!),” he said.
* RBC’s Pammi Bir to $19 from $17 with an “outperform” rating
* CIBC’s Dean Wilkinson to $19 from $17 with an “outperformer” rating.
=====
After Héroux-Devtek Inc. (HRX-T) delivered a third-quarter beat, Desjardins Securities analyst Benoit Poirier said he was impressed by management’s ability to deliver on its margin promises “sooner than expected, despite the ongoing pressure in the aerospace supply chain environment.”
“We are bullish on the margin outlook (with HRX pointing to margins above the historical level) given the greater throughput, increased efficiencies and the lack of M&A integration headwinds,” he said. “Taking all of this into consideration, we forecast a 15.4-per-cent margin in FY25, just a touch below peak historical levels.”
Shares of the Montreal-based landing gear manufacturer jumped over 10 per cent on Wednesday after it reported adjusted earnings per share of 27 cents, exceeding the Street’s expectation by 11 cents as revenue of $164-million grew 16 per cent year-over-year. Adjusted EBITDA $24.5-million, above the consensus estimate of $19.8-million and Mr. Poirier’s forecast of $20.0-million, implies a margin of 15.0 per cent (up 5 per cent year-over-year) and also above projections (13.3 per cent and 13.4 per cent, respectively).
“The main drivers of this unexpected margin outperformance were the step-up in throughput creating operating leverage (uptick in volume helped absorb fixed costs), price increase initiatives with customers (management has been at this for over a year) and manufacturing efficiencies (such as automation), all of which contributed to 740 basis points year-over-year of margin expansion (up 400 basis points quarter-over-quarter), helping offset the 280 basis points year-over-year inflationary headwind (170 basis points quarter-over-quarter),” said Mr. Poirier. “Even more exciting was the lack of one-time/catch-up drivers in the quarter. While the linearity of deliveries remains a challenge given the ongoing pressure in the aerospace supply chain environment (remains volatile due to long lead times for raw materials as well as inflation), management was bullish on the margin outlook. HRX expects the typical seasonal step-up in margins in 4Q (strongest quarter historically) and stated that it sees margins expanding to beyond historical levels over the next few years.”
The analyst thinks revenue, which has returned to a pre-pandemic level on a trailing 12 month basis, is “only up from here given strong demand backdrop and capacity legroom.”
“Production capacity stood at $650–680-million pre-pandemic, but adjusting for inflation (Canadian CPI), we estimate it could now be at $750–790-million, leaving plenty of room for further upside,” he said. “While management did not provide precise FY25 revenue guidance, it did state that it would be fair to expect an uptick.”
Raising his revenue and earnings projections through fiscal 2025 in response to its “impressive” results and management commentary, Mr. Poirier increased his target for Héroux-Devtek shares to $26 from $21, maintaining a “buy” rating. The average is $22.
“We believe HRX offers a compelling value proposition to opportunistically unlock inorganic growth opportunities,” he said. “We see more upside following a number of aerospace peer transactions at elevated multiples in recent months.”
Elsewhere, TD Securities’ Tim James upgraded the stock to “buy” from “hold” with a $23 target, up from $19.
Analysts making changes include:
* National Bank’s Cameron Doerksen to $23 from $19 with an “outperform” rating.
“Supply chain issues and inflationary costs, while still not completely resolved, appear to be easing,” said Mr. Doerksen. “With demand in both the Defence and Civil segments to remain strong over a multi-year period, we see a sustained run of revenue growth and margin expansion ahead for the company. Relative valuation is also attractive with the stock trading at 7.6 times F2025 EV/EBITDA versus the aerospace supplier peer group at 12.6 times forward EV/EBITDA.”
* Scotia’s Konark Gupta to $21 from $19.50 with a “sector outperform” rating.
“HRX posted a significant beat that we have not witnessed in many years, driven by strong volume, pricing and margin execution,” said Mr. Gupta. “Notably, revenue almost reached the prior peak while margin nearly closed the gap to pre-pandemic levels ahead of expectations, despite ongoing industry challenges. Management appeared confident that the next quarter will be seasonally stronger and revenue/margin have upside to higher peaks in the coming years, given strong demand and efforts to manage production, re-price contracts and automate processes. However, FCF conversion could take longer to normalize as HRX expects the surplus inventory to wind down more gradually due to industry-wide supply chain issues.”
=====
In a research note released Thursday titled You Ain’t Seen Nothing Yet, RBC Dominion Securities analyst Geoffrey Kwan predicted a “solid 2023 [is] setting the stage for an even better 2024″ from Brookfield Asset Management Ltd. (BAM-N, BAM-T).
“Yet another BTO classic,” he said. “BAM had a solid first year as a publicly traded stock in 2023, but FRE growth was tempered by elevated OpEx to fund growth initiatives. 2024 is set up to be an inflection year with revenue tailwinds from 2023′s strong fundraising, which should persist into 2024 and moderation of OpEx growth, which should see material FRE margin expansion.
“BAM is a Top 3 best idea reflecting our expectation of strong fundraising and FRE growth, attractive dividend yield and attractive valuation, particularly relative to its closest peer.”
Before the bell on Wednesday, Brookfield reported fee-related earnings per share of 36 US cents, up 1 per cent year-over-year and a penny above Mr. Kwan’s estimate due to lower-than-forecast expenses and higher-than-forecast transaction/advisory fees. He called the firm’s US$27-billion in fundraising “strong” with a target of US$90-US$10-billion in 2024.
After it also hiked its quarterly dividend by 19 per cent, Mr. Kwan raised his Street-high target for Brookfield Asset’s U.S.-listed shares to US$50 from US$49 with an “outperform” rating. The average is US$42.41.
“We believe BAM can generate a 17-per-cent compound annual growth rate (CAGR) in Fee Related Earnings (FRE) over the next five years,” he said. “Furthermore, we think BAM’s FRE valuation multiple is well positioned to benefit as arguably the purest publicly traded private equity/alternative asset manager in North America, reflecting: (1) asset-light, with zero principal investments; (2) debt-free, with US$2.7-billion in cash; (3) initially no accumulated but unrealized carried interest and with material realized carried interest unlikely until 2027, this makes BAM essentially a 100-per-cent fee revenue story in the nearto-medium term; and (4) an asset management business at scale with US$457-billion in Fee Bearing Capital (FBC).
“We see valuation upside potential in the near and medium term driven by: (1) mid-teens annual FRE growth; (2) FRE valuation multiple expansion as the macro environment improves; (3) an attractive dividend yield with mid-teens dividend growth potential; and (4) growth in carried interest generated, for which we think the current share price is reflecting little to no value.”
Elsewhere, believing an “attractive reward/risk is back,” Scotia’s Mario Saric bumped his target to US$47 from US$46.50 with a “sector outperform” rating.
“We disagree with BAM’s poor share price [Wednesday] am (better as the day progressed, incl. during the call),” he said. “We felt the 19-per-cent dividend increase was constructive (added 60 basis point of yield to pro-forma 3.8 per cent) and likely the highest in the Brookfield Group (we boosted our 2025 to 15 per cent from 9 per cent). We get the slight Q4 beat may be viewed ‘low quality’ given it was expense/tax driven and BAM lagged its $150-billion Fundraising target after expressing confidence with Q3 results ($100-billion ex. AEL; did $93-billion) but we also found BAM’s 2024 (we think gross) FBC guidance of $90-$100-billion (Feb’24 - Dec’24 more precisely) similarly constructive (our 2024 estimate = $82-billion on a net basis; 2025 estimate = $73-billion), along with its “outsized 2024E FRE growth...greater than 15-20-per-cent annual target (we’re at 25 per cent). It wasn’t too long ago we had an 5-per-cent BAM NTM [next 12-month] total return (late January) but the pull-back (4 per cent) + implied FRE/NAVPS support on the BLK-GIP deal = 22-per-cent NTM TR = reinvigorated enthusiasm for BAM reward/risk profile.”
=====
Touting an “attractive” yield and calling it an “inflation hedge,” Raymond James analyst Michael Glen initiated coverage of Diversified Royalty Corp. (DIV-T) with an “outperform” recommendation on Thursday.
“DIV is a diversified business with a model geared towards acquiring revenue royalty streams from well-managed multi-location businesses and franchisors in North America,” he said. “The company’s current royalty partners include Sutton Group, Mr. Lube, AIR MILES Loyalty Inc., Mr. Mikes, Nurse Next Door, Oxford, Stratus, and BarBurrito. DIV believes that its royalty structure provides a strong incentive for a royalty partner to continue growing their business, while retaining control of the operation. Specifically, the structure allows an owner to monetize a portion of their business without giving up any equity control.
“On the surface, we understand that investors have been hesitant to embrace the royalty structure in a substantial way, bu ... a glance at some of the historical results of DIV provide insight into a model that ultimately achieves its intended objectives. Post transaction, DIV’s royalty partners have continued to grow and build their royalty payment streams to the company, which is then flowed to investors in the form of dividends. We recognize that the dividend growth has been at a modest pace (3-per-cent CAGR since 2015), but to the extent that the model can achieve wider adoption, this should help provide support for a more elevated model and be increasingly accretive.”
Pointing to an “attractive all-in-return including dividends approaching 30 per cent,” Mr. Glen set a target of $3.40 per share. The average is $4.13.
=====
Citi analyst Tyler Radke sees upside to fourth-quarter 2023 revenue for Shopify Inc. (SHOP-N, SHOP-T), touting an “improving margin story.”
“We are upbeat on SHOP fundamentals heading into 4Q with guidance looking conservative with expected high-teens revenue year-over-year growth, despite strong BFCM [Black Friday Cyber Monday] sales and 4Q GMV [gross merchandise volume] seasonality which implies incremental upside to street estimates,” he said in a Thursday note. “Our front office checks suggest newer products like Shopify Audiences and Markets are gaining traction and the Shop App continues to become more important to the ecosystem.
“We’ve become increasingly positive on Shopify’s margin story supported by opex discipline + 4Q guidance which suggests opex ‘down low single digits’ which could be conservative. Assuming a higher tha 100 basis points operating margin beat in Q4, Shopify can exit 2023 with OPM near 20 per cent which provides a strong baseline for margin upside in 2024 considering consensus estimates are at 16.5 per cent. However, with the absence of long-term targets at December’s Analyst Day and shares trading 61 times 2025 estimated FCF vs. 31 times for front office peers, we remain on the sidelines and await a better entry point.”
While he sees “encouraging” growth for the Ottawa-based company’s Shop App, Mr. Radke warned web traffic indicators are “disappointing.”
“We’re encouraged by Ecommerce, shopping, and download data for the Shop App. Download data from SensorTower shows the Shop App has moved into the Top 25 downloaded apps in the U.S. and moved up to 3rd place within the “shopping” category in November from 5th in August,” said the analyst. “Shop App MAU growth accelerated to 17 per cent in Dec. (vs. 13 per cent, 12 per cent, 6 per cent in Nov., Oct., Sept., respectively). Business formation statistics from the Census Bureau in Sept.-Dec. appeared resilient, but we note weaker Citi credit card data on U.S. Retail categories.”
After raising his near-term forecast, Mr. Radke hiked his target to US$96 from US$87, keeping a “neutral” rating. The average is US$76.66.
=====
In other analyst actions:
* TD Cowen’s Helane Becker cut her Air Canada (AC-T) target to $30 from $32 with an “outperform” rating. The average is $29.95.
* Stifel’s Ian Gillies reduced his Algoma Steel Group Inc. (ASTL-T) target to $15.25 from $17.50 with a “buy” rating. The average is $14.94.
“Absent commodity price changes, four idiosyncratic items are going to drive ASTL’s share price performance: (1) a successful re-start of the steel plant in two weeks and normalization of coke production later this year; (2) delivering the EAF project in the prescribed cost range of $825-875-million; (3) retaining sufficient liquidity to finish the EAF and ramp up production and (4) depicting reasonable profitability during the EAF transition period beginning in calendar 2025,” he said. “We think there is a good chance the first three issues get resolved over the next six months, thus retaining our view that there is long-term value in the stock. The stock’s valuation is inexpensive at 2.9 times fiscal 2026 estimated EV/EBITDA.”
* In response to the release of its preliminary fourth-quarter 2023 assets under management, Desjardins Securities’ Gary Ho bumped his Fiera Capital Corp. (FSZ-T) target to $6.50 from $6.25 with a “hold” rating. The average is $6.57.
“Given the high payout ratio and limited visibility on the trajectory of PineStone net flows, we maintain our Hold rating,” he said. “While we like FSZ’s growing private alt platform (an attractive risk/return profile with steady cash flow) and compelling 12-per-cent dividend yield, we view the shares as fairly valued.”
* Raymond James’ David Quezada raised his Hydro One Ltd. (H-T) target to $40 from $38.50 with a “market perform” rating. The average is $39.79.
“As 4Q23 earnings season approaches for the regulated utilities in our coverage, we expect generally mixed results, which in most cases, will not move the needle. Specifically, our forecasts are slightly below consensus for each of Algonquin, AltaGas, Fortis and Emera, modestly above consensus for Hydro One,” he said.
“In a challenging market for rate exposed stocks, shares of Hydro One have continued to hold up remarkably well, something we believe is due to the company’s low-risk footprint, strong balance sheet and solid growth outlook. As such, we maintain a positive bias on the name and note that our Market Perform rating is largely a function of relative valuation. For the quarter, we expect higher average peak demand y/y (due to more favourable weather) to be offset by a ramp-up of OM&A spending (similar to 4Q22) and slightly higher financing charges. Looking past the quarter, we anticipate an update on the Section 92 approval for Waasigan, news on the company’s broadband initiatives within the province of Ontario (facing a 2025 deadline), and progress on the search for a new CFO. With EPS growth now trending toward the high end of the 5-7% targeted range out to 2027, we believe continued progress on large-scale transmission projects, further opportunities in the form of LDC consolidation, and broadband-related investments could support rate base growth of closer to 8 per cent.”
* JP Morgan’s Bill Peterson cut his Lithium Americas Corp. (LAC-T) target to $7.50 from $10 with a “neutral” rating. The average is $16.25.
* Berenberg’s Aron Ceccarelli reduced his Nutrien Ltd. (NTR-N, NTR-T) target to US$60 from US$67 with a “hold” rating. The average is US$69.19.
* CIBC’s Scott Fletcher increased his Stingray Group Inc. (RAY.A-T) target to $10 from $8, keeping an “outperformer” rating, while Desjardins Securities’ Jerome Dubreuil moved his target to $10 from $9 with a “buy” rating. The average is $9.25.
“This quarter felt like the inflection point in digital advertising, especially after management confirmed on the call that it now expects high-teens organic growth in the BCM segment (all but radio),” said Mr. Dubreuil. “This should result in consolidated organic growth of 10 per cent next year, which, coupled with the strong FCF profile, long growth runway, presence of potential catalysts and leverage under control make the stock quite attractive at 6.9 times NTM [next 12-month] EBITDA.”
* TD Securities’ Mario Mendonca raised his Sun Life Financial Inc. (SLF-T) target to $73 from $62 with a “hold” rating. The average is $74.50.