October 3, 2019

On Thursday, markets started out negative but finished positive with the S&P 500 up 0.8% and Toronto up 0.4%.

Linamar got hammered down 10.3% after indicating that sales were slowing in all three of its categories (auto parts, access – i.e. scissor lifts etc., and agricultural equipment. On top of that, the GM strike is costing it additional sales and profit loses. Linamar may not say anything further until its Q3 results are released. They will likely still be projecting good (although lower) profits in 2020. They may also be facing goodwill write-offs particularly on the big agricultural acquisition made in early 2018. While the company will likely resume earnings growth after a pause, investors heading for the exists could continue to push the price lower. Near-term catalysts for a an increase would be an end to the GM strike and/or significant progress on trade tensions.

Canadian Tire was down 2.7%, Couche-Tard was up 2.0%.


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