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Inside the Market's roundup of some of the Canadian small caps making news and on the move today. This post will be updated through the morning.
Concordia Healthcare Corp. shares are up more than 3 per cent in afternoon TSX trading after RBC Dominion Securities analyst Douglas Miehm enthusiastically initiated coverage on the stock.
"We view Concordia Healthcare as an exciting new specialty pharma company that has reached a level of maturity that should allow it to accelerate its growth profile and generate outsized returns over the next several years, especially given its structural tax advantage," he said.
After several decades of double-digit growth, pharma companies are scrambling to replenish pipelines and executives have been reassessing and selling off mature assets. Concordia Healthcare's strategy is to acquire assets with durable cash flows that have additional growth capacity plus a strong safety track-record.
"While Concordia (CXR) has been very successful in growing its business and capitalization since early 2014, we believe that it has now entered the "sweet spot" in a specialty pharma company's normal growth curve. This is a point where the cost of capital is at attractive levels and small acquisitions can still lead to outsized accretion and value creation," he added.
Mr. Miehm rates Concordia Healthcare "outperform" with a $46 (Canadian) price target. The analyst consensus price target over the next year is $44.38. Shares were up 3.5 per cent at $36.20 at mid-afternoon.
In other analyst actions involving Canadian small caps this morning:
Raymond James upgraded Tahoe Resources Inc. to "outperform" from "market perform" and maintained a $30 (Canadian) price target.
Canaccord Genuity initiated coverage on Ceiba Energy Services Inc. with a "speculative buy" rating and $1.25 (Canadian) price target.
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Serinus Energy Inc. said new currency regulations announced by the National Bank of Ukraine could have an impact on its 2015 capital program.
The bank's restriction "prohibits several types of foreign exchange transactions including, among other things, the ability of KUB-Gas LLC, Serinus' 70-per cent indirectly owned subsidiary which owns and operates the Ukraine licences, to pay dividends to its shareholders. Details regarding the practical administration of these new regulations have not yet been provided, and Serinus and its partners will continue to monitor and study new information as it becomes available."
"The company has sufficient cash, debt facilities and cash flow from its Tunisian operations to carry on its intended capital and operating programs for the rest of 2014. If these restrictions on foreign exchange are renewed or extended beyond December 2nd, it may impact the 2015 capital programme which is currently being planned. Total cash flow from Ukraine exceeds KUB-Gas' ability to redeploy in its Ukrainian licences. A continued ban on foreign exchange transactions would result in the build-up of idle cash balances within the country."
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Fission Uranium Corp. announced the results of its final seven angled drill holes for the summer drilling campaign at its PLS property in Canada's Athabasca Basin. All seven holes returned wide mineralization, with six returning intervals of greater than 10,000 cps radioactivity.
"This caps a fantastic drill program," commented Cantor Fitzgerald Canada analyst Rob Chang, who rates Fission Uranium a "buy - speculative" but does not have a price target on the stock. "We look forward to assay results and the upcoming resource estimate coming at the end of the year."
"We further note that FCU along with several uranium names have not participated in the strength we have seen in the uranium spot price (although they participated in step when the spot price headed lower). We believe there is some catch-up to be done at the very least (on top of what is already very compelling long term value based on a likely <100 pounds resource)," he added.
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GuestLogix Inc., which provides payment technology to the airline industry, announced an agreement for the fleet-wide deployment of its retail solutions for the support of food and beverage as well as duty free retailing across Tigerair Taiwan, the region's first low-cost carrier.
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Seabridge Gold Inc. announced that it has received early-stage construction permits for its KSM project from the government of British Columbia. The permits issued include: (1) authority to construct and use roadways along Coulter Creek and Treaty Creek; (2) rights-of-way for the proposed Mitchell-Treaty tunnels connecting project facilities; (3) permits for constructing and operating numerous camps required to support constructions activities; and (4) permits authorizing early-stage construction activities at the mine site and tailings management facility.
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CT Real Estate Investment Trust announced on Friday that it has purchased three properties in Ontario from Partners REIT for $34.9-million dollars. The properties, located in Brockville, Strathroy and Wasaga Beach, are expected to have a weighted average going-in cap rate of 6.53 per cent.
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Secure Energy Services Inc. announced it has entered into an amended $700-million syndicated credit facility with a syndicate of 10 financial institutions and Canadian Chartered banks. The syndicated facility consists of a $675-million extendible revolving term credit facility and a $25-million revolving operating facility that replaces the corporation's $400-million syndicated facility.
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Corridor Resources Inc. said it has hired Steve Moran as its next president and CEO, effective immediately. Mr. Moran has 30 years of oil and gas exploration and production experience in both the private and public sectors, with an emphasis on corporate planning and negotiations. Most recently, Mr. Moran was president and director of Stellavista Capital Corp., a private oil and gas company.
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SouthGobi Resources Ltd. said it has completed construction of a paved highway from the Ovoot Tolgoi Complex to the Shivee Khuren Border Crossing in Mongolia.
"With the completion of the paved highway, I am pleased to announce that we have achieved one of our key objectives for 2014. The highway will significantly increase the safety of coal transportation, reduce environmental impacts, and improve efficiency and capacity of coal transportation" said CEO Ross Tromans.
SouthGobi is 56-per cent owned by Turquoise Hill Resources Ltd., which is majority-owned by Rio Tinto Plc.
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Northern Dynasty Minerals Ltd. said a U.S. federal court in Alaska granted a motion to dismiss the case by the Pebble Limited Partnership, State of Alaska and Alaska Peninsula Corporation challenging the U.S. Environmental Protection Agency's statutory authority to pre-emptively impose development restrictions on the Pebble Project prior to the submission of a proposed development plan.
"The ruling today relates to timing of our challenge of this pre-emptive authority and in no way decides the underlying issues," said Pebble Partnership CEO Tom Collier. "We remain very confident in the merits of this case. Should EPA finalize its proposed veto restrictions regarding Pebble, we will pursue our claim that EPA lacks statutory authority to do so at that time."
The Pebble Project is an initiative of the Pebble Limited Partnership to develop a significant copper, gold and molybdenum deposit in southwest Alaska into a modern, long-life mine. It is Northern Dynasty's principal asset.
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Avigilon Corp., which provides high-definition video security solutions, announced the addition of the HD Video Appliance series to its expanding product portfolio. The HD Video Appliance series delivers the performance of the award-winning Avigilon Control Center (ACC) video management software, dramatically simplifies system design enables end-users to reduce both installation time and cost.
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Largo Resources Ltd. announced a $30-million (Canadian) non-brokered private placement of up to 107,142,858 units at a price of 28 cents per unit. Each unit will be comprised of one common share of the company and one common share purchase warrant.
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