Analysts and investors alike were pleased with what they heard at an investor day last week from Tim Hortons. Shares rose 2.5% on Friday and were up again in morning trading on Monday.
“It is clear that management is in growth and renewal mode, not a ‘harvest’ mode,” analyst Keith Howlett of Desjardins Securities wrote in a note to clients. He raised his target price on the shares to $36 from $35. “The key message from the investor day is that management’s commitment to drive profitable growth is undiminished by past success.”
Analyst Irene Nattel of RBC Capital Markets maintained her Outperform rating on the shares with a price target of $38, says the company has had a consistent track record of returning cash to shareholders. Including estimates from a recently raised dividend and a share repurchase program for this year,
“Tim Hortons will have returned over $1-billion to shareholders since the 2006 IPO,” by the end of 2010, she wrote in a note to clients.