JMRD Market Observer for March 27, 2015 – Highlights from NBF’s 13th Annual Canadian Financial Services Conference‏

March 27, 2015

**March 27th Issue of The JMRD Market Observer**

 

In This Week’s Market Observer

  • Canadian Financial Services – Key Takeaways from our 13th Annual Canadian Financial Services Conference
  • eDelivery: Electronic Tax Slips – A “How-To” for clients
  • JMRD Basket Corner
  • Retirement Corner
  • Week at a Glance
  • Reads of the week
  • Economic Calendar
  • Earnings Reports

 

Canadian Financial Services (Thematic Research) – Key Takeaways from our 13th Annual Canadian Financial Services Conference

 

On March 24 and 25, 2015, National Bank Financial held our 13th annual Canadian Financial Services Conference in Montréal. Senior leaders from 19 different companies participated in interviews with our analysts. In this document, we compile the key takeaways for nine of the large capitalization bank and life insurance companies that we cover. Our colleagues from the Diversified Financials team (Shubha Khan and Jaeme Gloyn) have written their own note on nine other financials that presented at our conference. With the Big Six Banks facing stiff headwinds in their personal & commercial banking platforms, the importance of capital markets to bank earnings growth has returned to the spotlight. Therefore, for the first time at a Canadian financial service conference, we focused our discussion exclusively on the capital markets business line. During the conference, each bank stressed the important differences in the nature of Canadian bank capital markets activity in the pre- and post-financial crisis world. In particular, the banks attempted to dispel investor perceptions about capital markets by emphasizing the return to high quality and stable businesses (lending, foreign exchange, advisory) versus riskier and more volatile business lines (proprietary trading, structured credit). In addition, our lunch time speakers – Stéfane Marion, NBF Chief Economist & Strategist and Pierre Fournier, NBF Geopolitical Analyst – offered insightful and topical presentations about the global macroeconomic and political climates. Mr. Marion pointed to encouraging signs for global economic growth in the face a global oil shock. Mr. Fournier enlightened the audience with a review of global geopolitical stress points, including the Middle East and Ukraine.

 

For further detail, please refer to the conference webcast, available in English and French

 

(Full report is attached)

Canadian Financial Services 032715

 

eDelivery: Electronic Tax Slips – A “How-To” for clients

 

Once again tax season is upon us and if you are enrolled in our online and e-delivery services, you will be able to retrieve your tax slips when you log into your account.

This message is intended to help maximize your experience when using our Online Services and accessing your electronic Tax Slips.  ThePCIS_E-Delivery pdf attachment will also be very useful to you if you are having trouble finding the slips.

PCIS_E-Delivery_TaxSlips_20150326

Accessible On Line

 

When retrieving your tax slips on line, please ensure you are accessing your documents via “All accounts” to prevent you from missing any important slips. The attachment to this email will help walk you through the process. Your Tax Slips are available under the last day of the fiscal year, December 31, 2014.

As well, if you are invested in Real Estate Investment Trust (REIT) and Closed-End Funds, you should receive two separate Tax Slips on line entitled Investment Income Summary.  These Tax Slips will appear as two different versions, both of which you will need when filing your taxes.

By Regular Mail

 Your Tax Slips for Mutual Funds will be sent through regular post directly by the Mutual Funds companies.

In addition, and if applicable, please note that the following Tax Slips will still be sent to you by regular post:

  •   Saskatchewan Mineral Exploration Tax Credit
  •  Interest and capital gains/losses to be reported for stripped coupons
  • §T5008 (options only)
  •  Estate Tax Slips
  • RC249
  •  T4A
  •  RL1
  • T4RSP
  • RL2
  • T4RIF
  • RL2
  • Contribution Receipts
  • NR4

Should you have any tax-related on online questions, please contact Faith Hatt at 519-439-6219.

JMRD Basket Corner

DIG Basket

Dollarama (DOL) – Dollarama reported Q4 results this week with Q4/F15 EPS of $0.76 vs. NBF at $0.72 and consensus at $0.75; last year was $0.59 (1) Dollarama delivered a solid quarter, supported by strong sales growth, margin expansion, reasonably good cost control and increased capital return. The EPS beat vs. NBF was largely due to a higher than expected gross margin rate (added $0.02 to EPS), a lower than expected SG&A rate (added $0.01) and a lower than expected tax rate (added $0.01). (2) Same store sales growth (sssg) was 8.5%, in line with NBF; last year was 1.1%. Basket growth was 4.7% vs. NBF at 4.0%; transaction growth was 3.6% vs. NBF at 4.5%. As speculated in our Q4/F15 preview note, Dollarama benefited from favourable weather in December 2014 relative to the y/y comp. Revenue was $669 mln vs. NBF at $674 mln and cons. at $685 mln; last year was $582 mln. (3) EBITDA was $151 mln vs. NBF at $145 mln and cons. at $148 mln; last year was $131 mln. (4) The company also increased its quarterly dividend to $0.09/share from $0.08/share, in line with NBF expectation. (5) DOL opened 27 net new stores during the quarter vs. our forecast of 26 stores. (6) Management indicated plans to open 70-80 net new stores in F2016, with 60

net new stores thereafter. The shares traded higher by 7.5% on the week to a new year-high of $70.00

Dollarama

 

All Cap Growth Basket

 Boyd Group (BYD.un) – Boyd reported EBITDA in-line with expectations at $19.0M and Q4 sales of $239.6M, the U.S. Same Store Sales Growth was quite strong at +8.6%. In addition, management highlighted $175-200M in “dry-powder” for growth while remaining conservatively leveraged (which we read to imply less than 2x). The shares traded higher by 4% on Friday to a new year-high of $52.25

 

Restaurant Brands (QSR) – “Time to Buy Restaurant Brands Intl. (QSR), Piper Jaffray Says; 50% Upside in Less than 5 Years”

 

 Retirement Corner

1)     Top Tax Breaks that are often overlooked: http://canadaam.ctvnews.ca/finance/top-tax-breaks-that-are-often-overlooked-1.2298032

 

 Week at a Glance

 (See attached Week at a Glance report)

 Week At A Glance

Reads of the Week

 

 Economic Reports

 Monday March 30th – Canadian Industrial Product Price Index, Canadian Raw Materials Price Index, U.S. Personal Income, U.S. Personal Spending, U.S. Pending Home Sales

Tuesday March 31st– Canadian GDP, U.S. Consumer Confidence Index

Wednesday April 1st – RBC Canadian Manufacturing PMI, U.S. ADP Employment Change, U.S. ISM Manufacturing

Thursday April 2nd – U.S. Initial Jobless Claims, U.S. Trade Balance, U.S. Factory Orders

Friday April 3rd – U.S. Unemployment Rate, U.S. Change in Nonfarm Payrolls, North American markets closed for Good Friday holiday

 

Earnings Reports

 Monday March 30th – None

Tuesday March 31st– Amaya Inc

Wednesday April 1st – Monsanto Co

Thursday April 2nd – Micron Technology

Friday April 3rd – None

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