This TSX stock was a top gainer with products less vulnerable to U.S. tariffs

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Photo by Graham Hughes /BloombergWhat National Bank sees as strengths and vulnerabilities for the TSX, which stocks RBC added to its market-weighted portfolio of best ideas and more from The Week in Stocks.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountStock of the week: BRP Inc.Shares of BRP Inc. (DOO:TSX) were among the top gainers on the S&P/TSX composite index, up nine per cent after the Sea-Doo and Ski-Doo maker reported earnings that beat estimates on a smaller than expected loss per share. This was primarily due to strong sales of its utility off-road vehicle (ORV). The Valcourt, Que. company also updated guidance for 2027 on a smaller than expected hit from changes to Section 232 U.S. tariffs on steel, aluminum and copper. The company said it has introduced new models, which are not subject to the tariffs, while all-terrain vehicle tariffs have dropped to 15 per cent from 25 per cent. BMO Capital Markets analyst Tristan Thomas-Martin hiked his price target for BRP to $110 from $100 and said in a note on Sept. 4 that the latest quarter “encapsulates the BRP story for us – Utility ORV share capture plus a strong lineup of upcoming new products which have been well received by dealers.” Shares closed Friday at $93.06. RBC Capital Markets analysts Sabahat Khan had the highest price target among analysts on Bloomberg at $113 which he set at the end of May and maintained on Sept. 4 implying a potential 21 per cent gain from Friday’s close. Stifel Global Research analyst Martin Landry hiked his price target for BRP to $90 from $85 on Sept. 3 with a hold rating but said in a note he believes that BRP’s “valuation is full.” BRP has a 12-month price target of $101.40 based on the calls of 14 analysts, according to Bloomberg.Keeping scoreCanada's best source for investing news, analysis and insight.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Investor will soon be in your inbox.We encountered an issue signing you up. Please try againTSX strengths and vulnerabilities, per National BankThe TSX, which reached a fresh record in August, sports less exposure to artificial intelligence than the U.S. S&P 500 index and, as a consequence, less “vulnerability” to climbing bond yields, said National Bank of Canada in its September report on stock markets. AI companies have been issuing mountains of debt, which are vulnerable to rising yields that increase borrowing costs. However, the report authors, Stéfane Marion, Matthieu Arseneau and Alexandra Ducharme, said that de-escalation on the trade front is key to the TSX — up 28.7 per cent this year — continuing to perform. National Bank reviewed its asset mix, maintaining its Canadian equity allocation at 21 per cent, just above the benchmark of 20 per cent. It set U.S. equities at 20 per cent, foreign equities and emerging market equities at three per cent each (just below the five per cent benchmark), fixed income at 48 per cent and cash at five per cent. National is also maintaining above benchmark holdings in energy, industrials and materials “to benefit from Ottawa’s renewed focus on resource development and reindustrialization,” the authors said. Energy accounts for a 16.6 per cent weighting in the equity portion, with most of that directed at oil, gas and consumable fuels. In industrials, nearly five per cent is weighted toward transportation with the rest split between commercial and professional services and capital goods, while much of materials is allocated to gold.What RBC added to its market-weighted portfolio of best ideasRBC Capital Markets reviewed its market-weighted portfolio of best ideas and made a few changes to the model, which holds 52 names traded on the TSX. RBC added four new names: Canadian Natural Resources Ltd. (CNQ:TSX), Nutrien Ltd. (NTR:TSX), Ovintiv Inc. (OVV:TSX) and Whitecap Resources Inc. (WCP:TSX). On Canadian Natural: “We view CNQ as the benchmark amongst producers in Canada,” RBC analyst Greg Pardy said in the report. The company currently returns 75 per cent of free cash flow to investors and Pardy expects that to increase to 100 per cent in early 2027. RBC has a price target of $79. Shares closed Friday at $69.78. On Nutrien: “Valuation appears attractive at current levels given solid cash generation outlook,” RBC analyst Andrew Wong said. He has a price target of $118.44. Shares closed Friday at $110.10. On Ovintiv: “Ovintiv has delivered impressive operational/financial performance over a series of quarters, yet its relative valuation has yet to reflect that,” Pardy said. He likes that Ovintiv has focused its portfolio around the Montney and Permian basins and said that strong performance coupled with an updated shareholder return model should “close the valuation gap.” Pardy has a price target on Ovintiv of $117.62. Shares closed Friday at $89.57. On Whitecap Resources: “Whitecap offers … a track record of improving well results, cost reductions, and consistent outperformance against guidance,” RBC analyst Michael Harvey said, adding he thinks Whitecap is positioned for acquisitions and further share buybacks. Harvey has a price target of $20. Shares closed Friday at $17.98. Other changes to the portfolio included weighting increases to Barrick Mining Corp. (ABX:TSX), Franco-Nevada Corp. (FNV:TSX), Weightings were decreased for Alamos Gold Inc. (AGI:TSX), BCE Inc. (BCE:TSX) and Enbridge Inc. (ENB:TSX). Cascades Inc.(CAS:TSX) was dropped after shares gained 50 per cent over three months. RBC’s market-weighted portfolio returned 4.3 per cent over the past three months against 4.9 per cent for the TSX.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below. The Lululemon Athletica Inc. flagship store in Shanghai, China. Photo by Qilai Shen/Bloomberg filesPrice target hikes, holds and cutsScotia Capital Markets analyst Mike Rizvanovic cut his price target for EQB Inc. (EQB:TSX) to $135 from $141 on a “messy” third quarter that included higher than expected provisions for credit losses. Shares closed Friday at $132.92.Stifel Canada analyst Cole McGill maintained his price target of $8.50 with a buy rating for Mining Americas Inc. (MAI:TSX) after it received “key” federal approvals for its gold project Cerro do Oro in Mexico. Shares closed Friday at $6.53.UBS Global Research analyst Jay Sole cut his price target for Lululemon Athletica Inc. (LULU:Nasdaq) to US$106 from US$120 and said a pullback in the shares following a “disapppointing” second quarter was no reason to buy. Shares closed Friday at US$100.61.CIBC Capital Markets analyst Kevin Chiang hiked his price target for GFL Environmental Inc. (GFL:TSX) to $82 from $76 on media reports the efforts to sell the company have advanced. Shares closed Friday at $60.45.Every week, the Financial Post breaks down the most interesting developments in the week’s world of investing, from top performers to surprising analyst calls and stocks to have on your radar.Are you an investor looking for stock ideas and market insight? Sign up for the weekly FP Investor Newsletter here to get the best of the Financial Post’s investing news, analysis and expert commentary straight to your inbox.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.