The Daily Chase: In Conversation with Bay Street Power Brokers; General Electric separates

Two Bay Street titans join us today, fresh off of report results that give us a better idea of ​​how power brokers and average investors are performing. At Canaccord Genuity, earnings and revenue exceeded expectations in last trimestre amid surging demand for M&A advisory services, particularly in the United States, where Canaccord said it raked in more in the quarter than in any previous full year. As for TMX Group, its earnings landed slightly below expectations, as spending growth outpaced rising revenues and a slowdown in business activity. Watch for our interviews with Canaccord CEO Dan Daviau and TMX CEO John Mackenzie at 9 a.m. Even putting profits aside, now is a good time for these conversations, as market booms pushed all four major North American indices to record highs yesterday – and prompted the US Federal Reserve to warn against stretched valuations in its report on financial stability.

NEWCREST PURCHASING PRETIUM RESOURCES

The Australian miner will pay $18.50 in cash or stock for each Pretium share in a deal worth $3.5 billion. That’s a nearly 23% premium to yesterday’s close and carries a breakout fee of $125 million if Pretium leaves. One can’t help but wonder about the possibility that the BC-based miner will at least see other offers, considering the sporadic speculation over the years that Barrick Gold had its eye on Premium.

GE BREAK

So much for the conglomerate model. GE CEO Larry Culp is loss the patchwork of businesses that were set up by his predecessors in what will almost certainly be the defining decision of his tenure. The healthcare business will be spun off in 2023. Three of its other divisions are merged into a green transition-focused business which will be spun off a year later. And GE will then remain an entity focused on aviation. We will continue the feedback and determine if this is the catalyst to repair years of poor market performance – and if other conglomerates will be pressured to follow suit.

WHITE HOUSE CONFIRMS IT IS INVESTIGATING LINE 5 SHUTDOWN

This was confirmed yesterday by assistant press officer Karine Jean-Pierre, who noted “Yeah” in his press conference when asked if the administration was studying the impact of closing the Enbridge pipeline that has become a lightning rod for controversy. Jean-Pierre notes, however, that no decision has been made.

INCORRECT BETS LIMITING CASH GUSHER

MEG Energy was burned by its hedges in the last quarter. Adjusted cash flow increased nearly tenfold in the third quarter, from $26 million to $239 million a year earlier, and the company noted the growth would have been even more impressive if it hadn’t been for a $66 million loss on what it officially calls “realized commodity price risk management.” MEG pointed out that it is not hedged on West Texas Intermediate or the Western Canadian Select differential in 2022. But there are many questions to be asked about the hedging strategy that was put in place last year.

OTHER NOTABLE STORIES

  • Another major financial institution is increasing its dividend. iA Financial announcement a sweetener of 14 cents per share for its December payout to shareholders, effectively increasing the payout by 29%. It also refined its target payout ratio, which sets the stage for higher future dividends. Unlike its peers who have raised dividends over the past few days, iA Financial said its decision was triggered by Quebec’s securities regulator, saying it was also waiving a ban on raising dividends. dividends in the time of the pandemic.
  • We’ll be watching Cronos Group shares again today after the cookware producer warned it faces at least US$220 million in impairment charges delaying the filing of financial statements. Shares of the company soared yesterday amid speculation over its ownership structure and wider euphoria surrounding legalization efforts in the United States.
  • Dye & Durham, which recently made headlines for avoiding a management-led takeover bid and simultaneously hedging its CEO with stock options, job a 414% increase in fiscal first quarter revenue driven by growth fueled by mergers and acquisitions.
  • Robinhood Markets revealed a security breach late yesterday afternoon. About 7 million users of the trading app were affected, with more detailed information for a smaller group of 310 exposed customers, according to Robinhood. HOOD shares slide in premarket trading.
  • And one of the stocks that has been carried away by the meme frenzy is in the news, with AMC Entertainment shares falling in premarket trading, even as the US cinema operator beat earnings estimates of the third quarter and posted a lower than expected loss as footfall picked up. Perhaps the ho-hum response to performance is explained by the 2,025.5% year-to-date rise for AMC shares.

NEWS RELEASES / NOTABLE EVENTS

  • Notable Data: U.S. Producer Price Index
  • Notable Profits: Intact Financial, Linamar, AutoCanada, Aurora Cannabis, Nuvei, Hydro One, TransAlta, WSP Global, CAPREIT, Peyto Exploration, Vermilion Energy, Freshii, Indigo Books & Music, Coinbase Global, DoorDash
  • 1000: Ontario Securities Commission hearing re. Bridging financing
  • 11 a.m.: Canadian Association of Petroleum Producers CEO Tim McMillan and Indian Resource Council of Canada CEO Stephen Buffalo hold a virtual press conference regarding. COP26
  • 12:00 p.m.: Alberta Premier Jason Kenney and Minister of Labor Tyler Shandro deliver remarks on the Alberta Jobs Now program
  • 12:10 p.m.: Yale University Professor Robert Shiller delivers the John Kuszczak Bank of Canada Memorial Lecture on Narrative Economics and Monetary Policy
  • 5:45 p.m.: Bank of Canada Governor Tiff Macklem delivers closing remarks at the Conference on Diversity and Inclusion in Economics, Finance and Central Banking