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R B C W E A LT H M A N A G E M E N T
GLOBAL INSIGHT
W E E K L Y
MARCH 27, 2015
A C LO S E R LO O K
M&A Wave Swells
Kelly Bogdanov – San Francisco
The merger & acquisition wave continued to gain strength in Q1. Is it beginning to crest and signal a
market top, or is it just another sign the global bull market remains intact?
Despite the Q1 growth decline, Europe’s M&A volume was
strong in March and late last year. But the region remains
prone to fits and starts as the economic recovery slowly builds.
Among industries, consumer non-cyclical is in the lead thanks
to the $55.4B Kraft-Heinz merger announced during the
week that also involved Berkshire Hathaway, which is run by
legendary investor Warren Buffett, and Brazilian private equity
firm 3G Capital, which is widely known for its cost-cutting
prowess. This is the biggest deal globally so far this year.
M&A Sending Positive Vibes
So what does the healthy M&A activity mean for the investing
environment? Generally there is a loose, positive correlation
Click here for authors’ contact information. Priced as of 3/27/15 market close,
EST (unless otherwise noted). All values in USD unless otherwise noted.
For Important and Required Non-U.S. Analyst Disclosures, see page 6.
1000
800
600
400
200
Q1 2015*
Q1 2014
Q1 2013
Q1 2012
Q1 2011
Q1 2010
Q1 2009
Q1 2008
Q1 2007
Q1 2006
0
Q1 2005
What’s interesting is that Asia Pacific led by far on a year-overyear basis, with Q1 growth up an eye-popping 45% versus
13% for North America and a decline of 8% for Europe. This
is mainly due to the $41.7B deal between two of Hong Kong’s
largest and best-known firms, Cheung Kong Holdings and
Hutchison Whampoa, the second-largest deal globally so far
this year.
Global Merger & Acquisition Volume (in $B)
Q1 2004
Among regions, North America led with 53% of total volume,
followed by Europe and Asia Pacific at 22% and 21%,
respectively. While North America is almost always in pole
position because of strong U.S. activity, its Q1 share is at the
high end of what is typical.
Q1 2015 Is Highest First-Quarter M&A Volume Since 2007
Q1 2003
Global M&A volume climbed to $785B, its highest Q1 level
since 2007, before the financial crisis.
* Q1 2015 data through 3/26/15; likely will be higher at month’s end.
Source - RBC Wealth Management, Bloomberg
M A R K ET P U L S E
3
Oil rout’s impact on Alberta’s new budget
4
A peek at earnings results for China’s big banks
The Global Insight Weekly will not be published next week due to
the Good Friday holiday. The next edition will be available April 10
in North America and April 13 in Europe and Asia.
between M&A activity, global GDP growth, and major equity
markets—meaning they tend to rise or fall together over time,
but not always on a precise month-by-month or quarter-byquarter basis.
M&A activity can also alert investors to potential inflection
points. When it spikes to extremely high levels relative to the
recent trend and moves well beyond previous highs, it often
loosely corresponds with a peak in economic activity and a top
in the broad equity market—give or take a handful of months.
For example, in the previous M&A cycle, volume surged in Q2
2007, reaching a new high, and the MSCI World Index peaked
four months later.
Likewise, when M&A plunges to an ultra-low level, it tends to
signal the economy and broad equity market are near a bottom.
The last time this occurred was the deep M&A trough in Q3
2009. The MSCI World fell to its lowest point a few months prior
to that, and global GDP bottomed a few months afterwards.
Even though Q1 2015 volume is strong and the best since
2007, it’s not sending a warning signal, in our view. It’s not at
an extremely high level—it hasn’t even eclipsed the 2007 high
and it has yet to spike well above the recent trend—so we don’t
believe it’s flashing a market top.
Instead, it’s just one more sign that global GDP, while
disappointing and uneven at times, should keep moving
higher this year, and that the global equity bull market remains
intact.
Kraft-Heinz Deal Pushed Consumer Non-cyclical to the Top Slot
Industries Leading M&A Volume Year to Date (in $B)
Consumer Non-cyclical
218
Financial
174
Industrial
91
Communications
66
Consumer Cyclical
57
Diversified
55
Technology
47
Energy
43
Basic Materials
21
Utilities
20
Source - RBC Wealth Management, Bloomberg; data through 3/26/15
WWHHATAT’ S’ SMMOOV VI NI NGGMMA AR RK KETETS S
March Madness
Most equity markets were unable to rally for the week, despite
better-than-expected European manufacturing and services
data (PMIs).
Chaos in Yemen was cited by some as the primary source of
pressure, particularly due to Saudi Arabia’s direct intervention
and because Yemen represents one more battlefield in the
ongoing proxy war between Saudi Arabia and Iran.
But we believe U.S. earnings jitters, another batch of soft U.S.
economic data, weak Japanese inflation, currency crosscurrents,
and normal profit taking were mainly responsible for the global
equity pullback.
Even though European stocks gave up ground, fund flows
targeting the region continued to march higher for the week.
Western Europe’s equity and bond flows, and U.S. bond flows
have risen meaningfully for the year. In contrast, U.S. equity
flows are lagging (see chart).
In a U.S. Versus European Showdown,
U.S. Equity Fund Flows Are Lagging
Cumulative Fund and ETF Flows (in $M)
60,000
U.S. Bonds
40,000
Western Europe
Stocks
Western Europe
Bonds
20,000
0
-20,000
U.S. Stocks
-40,000
-60,000
31-Dec
31-Jan
28-Feb
Source - RBC Wealth Management, EPFR Global; weekly data through 3/25/15
This fund flow pattern took hold as investors began positioning
for Europe’s quantitative easing program, and adjusted
to diminished U.S. earnings expectations and economic
momentum. We believe the trend could persist over the near
term, at least until S&P 500 earnings estimates stabilize.
GLOBAL INSIGHT WEEKLY
March 27, 2015
2
U N I T E D S T AT E S
Kelly Bogdanov – San Francisco
■
■
■
■
■
Q1 Estimate in Negative Territory; Full-Year Barely Positive
Consensus S&P 500 Earnings Growth Forecast by Date (y/y)
With earnings season kicking off on April 8, angst about
profit warnings and potential earnings misses has held
back the market. Negative warnings are exceeding positive
announcements by a 5.9:1 ratio for Q1, according to
Thomson Reuters I/B/E/S. That’s actually down from 7.2
last year when poor weather wreaked havoc, but is well
above the 2.6 average since 1995.
The dollar’s 7.7% rally on a trade-weighted basis so far this
quarter has caused much of the handwringing about Q1
reports. Some multinationals slashed profit forecasts during
the Q4 earnings season and, so the thinking goes, it could
happen again.
We wouldn’t be surprised if the consensus Q1 and full-year
forecasts dip a bit more. But it’s important to step back and
consider estimates have already come down markedly. The
full-year 2015 S&P 500 consensus forecast has declined to
only $121 per share from $133 on October 1. If profits end up
at $121 at the end of the year, it would represent a meager
1.8% y/y increase. Furthermore, Q1 earnings are forecast to
decline 2.8% y/y, down from a double-digit growth forecast
almost six months ago (see chart). In our view, much of the
damage to earnings estimates has already been done.
On a sector basis, the decimation of the energy sector’s
profit forecast is the primary reason the Q1 S&P 500
earnings growth rate is in negative territory. Energy
sector earnings are expected to tumble 63% y/y due to the
crude oil collapse. Estimates are also negative for utilities
(-6.7%), materials (-2.4%), and telecom (-1.0%), but these
three sectors combined represent only 8.5% of the S&P
500. Consumer staples seems like the only large sector that
may struggle to grow in Q1. Health care, industrials, and
consumer discretionary are on pace to deliver roughly 7%
y/y growth at this stage.
While the Q1 earnings season could have rocky moments—
and the market could react—we believe earnings estimates
should begin to stabilize as the strong dollar is factored
into multinationals’ forecasts. And because we expect the
greenback’s rally to moderate, we doubt it will have such an
outsized negative impact on earnings in coming quarters.
Oct 1, 2014
■
The S&P/TSX Composite edged lower as financials,
materials, and industrials sagged. Energy was a bright spot
as crude oil prices enjoyed a modest rally.
GLOBAL INSIGHT WEEKLY
Mar 26, 2015
12.4%
11.5%
8.1%
5.3%
1.8%
-2.8%
Q1 2015
Full-Year 2015
Source - RBC Wealth Management, Thomson Reuters I/B/E/S
■
Railroad shares lagged the market after Kansas City
Southern warned that its results would suffer from
weaker-than-expected coal and energy markets. We believe
the implications for the domestic rail carriers are limited
given low coal exposure and previously communicated
moderation in crude-by-rail expectations.
■
Government of Canada bond yields ended the week higher.
After a pair of addresses by Bank of Canada representatives,
the tone has shifted to somewhat less accommodative from
undeniably dovish. The impression that a second cut to the
lending rate was a fait accompli has diminished.
■
Alberta will increase its reliance on debt and taxes to offset
the expected decline in resource-based revenue due to the
depressed energy price environment. The 2015–16 budget
will see the province raise a forecast CA$9.8B in debt while
increasing taxes levied on gas, alcohol, and tobacco, among
other changes. The province expects to run a CA$5B deficit
this year.
■
Included in the budget was Alberta’s first personal income
tax rate increase since 1987. The province plans to raise the
marginal tax rate for individuals with income over $100,000
to 10.5% from 10% in 2016, with further 0.5% increases in
2017 and 2018.
■
Following the release of the budget, spreads on Alberta
bonds were unchanged indicating the perceived credit
quality of the province was unchanged.
CANADA
Patrick McAllister & Alana Awad – Toronto
Jan 1, 2015
EUROPE
Frédérique Carrier & Davide Boglietti – London
■
European equities fell during the week, with the STOXX
Europe 600 Index decreasing 2.1% to 395.54 following seven
consecutive weeks of gains. The euro, whose weakness has
March 27, 2015
3
been a main driver for European equity markets, recovered
against major currencies. This negatively affected the shares
of exporting and dollar-earning companies, as they benefit
most from a weaker currency. Equities, however, continue to
be supported by expectations on quantitative easing, and by
the hope of an improved economic environment on the back
of structural reforms.
■
■
The confluence of positive tailwinds from lower commodity
prices, lower interest rates, and a weaker currency is helping
to lift the European economy. The euro area composite
PMI climbed to 54.1 in March from 53.3. The services
PMI increased to 54.3 from 53.7, while the manufacturing
PMI improved to 51.9 from 51.0. By country, the German
composite PMI hit an eight-month high of 55.3, with a
strong reading on the manufacturing output index. The
French composite PMI weakened during the month, but
remained above the 50.0 “no change” threshold level. While
these numbers are encouraging, they are consistent with
quarterly growth of only a modest 0.4% q/q.
European Returns in Local Currencies
Have Been Eroded by Dollar Strength
Year-to-Date Returns for Major Equity Indices
18%
12%
10%
8%
6%
4%
2%
0%
STOXX 600
February’s Japanese inflation data was weak. Although
consumer prices excluding fresh food rose by 2% y/y, after
accounting for last year’s sales tax increase, prices were flat.
We have noted previously that Japan may enter a period of
deflation, as commented upon by Bank of Japan Governor
Haruhiko Kuroda. This would be primarily due to the
sharp drop in energy prices and should be a temporary
development, in his opinion. Even so, we see plenty of
scope for this to generate negative headlines with respect to
the success of economic policy.
GLOBAL INSIGHT WEEKLY
TOPIX
FTSE
All-Share
S&P 500
■
ICBC (1398.HK), China’s largest bank, announced full-year
2014 earnings rose 5% y/y. However, quarterly earnings
declined 3.1%, the first quarterly decline since 2009. Even
so, ICBC earned $8.9B in Q4 2014. What is remarkable, in
our view, is that quarterly earnings have been consistently
moving higher over the past several years even as the pace
of growth has slowed in China. Non performing loans
(NPL) rose, as has been the case across the sector, with
the NPL ratio standing at 1.3%. The bank remains well
capitalized, with core Tier 1 equity of just under 12%. The
increase in capital levels was helped by preferred share
issuance, something relatively new to the Chinese market.
This has also been the case for other banks. The dividend
was modestly reduced.
■
Bank of China (3988.HK), another major bank, reported
similar trends. Somewhat different to other Chinese
banks, however, Bank of China continues to be the most
international of the major banks, deriving nearly onequarter of earnings from international activities.
■
China Mengniu Dairy (2319.HK), a leading Chinese
consumer staples brand and the largest milk products
company in the country, reported particularly strong 2014
earnings. Sales rose 15%, while China’s liquid milk market
grew 12%. Mengniu’s earnings rose by over 50% in the
second half, helped by much-improved margins.
Jay Roberts – Hong Kong
■
Shanghai
Composite
Source - RBC Wealth Management, Bloomberg; data as of 3/27/15 at 2:10 PM GMT
In the U.K., February inflation fell to 0% y/y, a new record
low. Disinflationary pressures were not confined to the food
and energy sectors, and were more generalised in February.
The Bank of England’s Monetary Policy Committee is likely
to take note of this, though we believe its policy will rely
more on longer-term inflation expectations and wage
dynamics going forward.
Japan’s TOPIX index streak of weekly increases ended at
nine, although the index did reach a new cycle-high early in
the week. The Shanghai Composite, also in a bull market,
rose to a new cycle-high and held on to gains.
Return in U.S. Dollars
14%
A S I A PA C I F I C
■
Return in Local Currency
16%
March 27, 2015
4
M A R K ET S C O R E C A R D
Data as of March 27, 2015
Equities (local currency)
Level
S&P 500
Dow Industrials (DJIA)
1 Week
MTD
YTD
12 Mos
Govt Bonds (bps chg)
Yield
1 Week
MTD
YTD
12 Mos
11.5%
U.S. 2-Yr Tsy
0.591%
0.9
-2.8
-7.4
14.5
2,061.02
-2.2%
-2.1%
0.1%
17,712.66
-2.3%
-2.3%
-0.6%
8.9%
U.S. 10-Yr Tsy
1.951%
2.1
-4.2
-22.0
-73.0
4,891.22
-2.7%
-1.5%
3.3%
17.8%
Canada 2-Yr
0.525%
7.0
5.3
-48.7
-54.0
NASDAQ
Russell 2000
1,240.41
-2.1%
0.6%
3.0%
7.7%
Canada 10-Yr
1.370%
6.5
6.9
-41.8
-106.5
S&P/TSX Comp
14,812.42
-0.9%
-2.8%
1.2%
4.5%
U.K. 2-Yr
0.397%
-0.3
-3.7
-4.9
-27.7
FTSE All Share
3,701.62
-2.3%
-1.1%
4.8%
4.3%
U.K. 10-Yr
1.542%
2.6
-25.4
-21.4
-113.3
395.54
-2.1%
0.8%
15.5%
19.4%
Germany 2-Yr
-0.246%
-1.0
-1.9
-14.8
-38.2
German DAX
11,868.33
-1.4%
4.1%
21.0%
25.6%
Germany 10-Yr
0.207%
2.3
-12.1
-33.4
-132.9
Hang Seng
24,486.20
0.5%
-1.4%
3.7%
12.1%
STOXX Europe 600
Shanghai Comp
3,691.10
2.0%
11.5%
14.1%
80.4%
Nikkei 225
19,285.63
-1.4%
2.6%
10.5%
31.9%
India Sensex
27,458.64
-2.8%
-6.0%
-0.1%
23.6%
3,450.10
1.1%
1.4%
2.5%
9.1%
Brazil Ibovespa
50,094.66
-3.6%
-2.9%
0.2%
0.9%
Mexican Bolsa IPC
43,637.97
-0.8%
-1.2%
1.1%
9.3%
Singapore Straits Times
Commodities (USD)
Gold (spot $/oz)
Silver (spot $/oz)
Price
1 Week
U.S. Dollar Index
Rate
1 Week
MTD
YTD
12 Mos
97.39
-0.5%
2.2%
7.9%
21.6%
CAD/USD
0.79
-0.4%
-0.8%
-7.8%
-12.5%
USD/CAD
1.26
0.4%
0.7%
8.4%
14.2%
EUR/USD
1.09
0.8%
-2.6%
-9.9%
-20.6%
GBP/USD
1.49
-0.4%
-3.6%
-4.5%
-10.4%
AUD/USD
0.78
-0.1%
-0.6%
-5.0%
-16.1%
MTD
YTD
USD/CHF
0.96
-1.6%
0.6%
-3.5%
8.3%
1.2%
-7.2%
USD/JPY
119.18
-0.7%
-0.4%
-0.5%
16.6%
1,198.66
1.4%
-1.2%
12 Mos
Currencies
16.99
1.5%
2.4%
8.2%
-13.8%
EUR/JPY
129.94
0.0%
-3.0%
-10.3%
-7.5%
6,195.50
2.0%
4.6%
-2.7%
-5.7%
EUR/GBP
0.73
1.2%
1.0%
-5.7%
-11.4%
Oil (WTI spot/bbl)
48.87
6.9%
-1.8%
-8.3%
-51.7%
EUR/CHF
1.05
-0.8%
-2.0%
-13.0%
-14.1%
Oil (Brent spot/bbl)
56.09
1.4%
-10.4%
-2.2%
-48.0%
USD/SGD
1.37
-0.7%
0.5%
3.3%
8.3%
2.59
-7.0%
-5.3%
-10.3%
-43.5%
USD/CNY
6.22
0.2%
-0.9%
0.2%
0.0%
296.66
-1.5%
-3.3%
-8.0%
-27.2%
USD/BRL
3.24
0.3%
14.1%
22.0%
43.5%
Copper ($/metric ton)
Natural Gas ($/mmBtu)
Agriculture Index
Source - Bloomberg. Note: Equity returns do not include dividends, except for the German DAX. Bond yields in local currencies. Copper and Agriculture Index data as of Thursday’s close.
Dollar Index measures USD vs. six major currencies. Currency rates reflect market convention (CAD/USD is the exception). Currency returns quoted in terms of the first currency in each
pairing. Data as of 9:37 pm GMT 3/27/15.
Examples of how to interpret currency data: CAD/USD 0.79 means 1 Canadian dollar will buy 0.79 U.S. dollar. CAD/USD -12.5% return means the Canadian dollar fell 12.5% vs. the
U.S. dollar year to date. USD/JPY 119.18 means 1 U.S. dollar will buy 119.18 yen. USD/JPY 16.6% return means the U.S. dollar rose 16.6% vs. the yen year to date.
U P CO M I N G EV E N TS
SUN, MAR 29
TUE, MAR 31
WED, APR 1
THU, APR 2, cont.
Japan Industrial Prod. (-1.5% m/m)
China Official Manuf. PMI (49.7)
Eurozone Markit Manuf. PMI (51.9)
U.S. Factory Orders (0.0% m/m)
MON, MAR 30
China Official Non-Manuf. PMI
U.K. Markit Manuf. PMI (54.2)
Canada Int’l Merch. Trade (-CA$1.8B)
Japan Labor Cash Earnings
China HSBC Manuf. PMI (49.4)
U.S. ADP Employment
FRI, APR 3
Germany CPI (0.4% m/m, 0.2% y/y)
Japan Markit Manuf. PMI
U.S. ISM Manuf. (52.5)
U.S. Nonfarm Payrolls (250K)
U.S. Core PCE (0.1% m/m)
Eurozone Unemployment (11.2%)
Canada RBC Manuf. PMI
U.S. Unemployment (5.5%)
U.S. Personal Spending (0.2% m/m)
Eurozone CPI (-0.3% y/y, Core 0.7% y/y)
THU, APR 2
U.S. Avg. Hourly Earnings (0.2% m/m)
U.K. GDP Q4 rev. (0.5% q/q, 2.7% y/y)
China HSBC Services PMI
WED, APR 8
Canada GDP January
China HSBC Composite PMI
U.S. Q1 earnings season begins
All data reflect Bloomberg consensus forecasts where available
GLOBAL INSIGHT WEEKLY
March 27, 2015
5
AUTHORS
Kelly Bogdanov – San Francisco, United States
[email protected]; RBC Capital Markets, LLC.
Patrick McAllister – Toronto, Canada
[email protected]; RBC Dominion Securities Inc.
Alana Awad – Toronto, Canada
Distribution of Ratings
For the purpose of ratings distributions, regulatory rules require member firms
to assign ratings to one of three rating categories - Buy, Hold/Neutral, or Sell regardless of a firm’s own rating categories. Although RBC Capital Markets, LLC
ratings of Top Pick (TP)/Outperform (O), Sector Perform (SP) and Underperform (U)
most closely correspond to Buy, Hold/Neutral and Sell, respectively, the meanings
are not the same because our ratings are determined on a relative basis (as
described below).
[email protected]; RBC Dominion Securities Inc.
Frédérique Carrier – London, United Kingdom
[email protected]; Royal Bank of Canada Investment Management (UK) Ltd.
Davide Boglietti – London, United Kingdom
Distribution of Ratings - RBC Capital Markets, LLC Equity Research
As of December 31, 2014
Investment Banking Services
Provided During Past 12 Months
Count
Percent
Count
Percent
[email protected]; Royal Bank of Canada Investment Management (UK) Ltd.
Rating
Jay Roberts – Hong Kong, China
Buy [Top Pick & Outperform]
Hold [Sector Perform]
Sell [Underperform]
[email protected]; RBC Dominion Securities Inc.
897
686
112
52.92
40.47
6.61
290
137
6
32.33
19.97
5.36
Explanation of RBC Capital Markets, LLC Equity Rating System
D I S C LO S U R E S A N D D I S C L A I M E R
Analyst Certification
All of the views expressed in this report accurately reflect the personal views of the
responsible analyst(s) about any and all of the subject securities or issuers. No
part of the compensation of the responsible analyst(s) named herein is, or will be,
directly or indirectly, related to the specific recommendations or views expressed by
the responsible analyst(s) in this report.
Important Disclosures
In the U.S., RBC Wealth Management operates as a division of RBC Capital Markets,
LLC. In Canada, RBC Wealth Management includes, without limitation, RBC
Dominion Securities Inc., which is a foreign affiliate of RBC Capital Markets, LLC.
This report has been prepared by RBC Capital Markets, LLC. which is an indirect
wholly-owned subsidiary of the Royal Bank of Canada and, as such, is a related
issuer of Royal Bank of Canada.
Non-U.S. Analyst Disclosure: Alana Awad, Patrick McAllister, and Jay Roberts,
employees of RBC Wealth Management USA’s foreign affiliate RBC Dominion
Securities Inc.; and Davide Boglietti and Frédérique Carrier, employees of RBC
Wealth Management USA’s foreign affiliate Royal Bank of Canada Investment
Management (UK) Limited; contributed to the preparation of this publication.
These individuals are not registered with or qualified as research analysts with
the U.S. Financial Industry Regulatory Authority (“FINRA”) and, since they are not
associated persons of RBC Wealth Management, they may not be subject to NASD
Rule 2711 and Incorporated NYSE Rule 472 governing communications with subject
companies, the making of public appearances, and the trading of securities in
accounts held by research analysts.
In the event that this is a compendium report (covers six or more companies), RBC
Wealth Management may choose to provide important disclosure information
by reference. To access current disclosures, clients should refer to http://www.
rbccm.com/GLDisclosure/PublicWeb/DisclosureLookup.aspx?EntityID=2 to view
disclosures regarding RBC Wealth Management and its affiliated firms. Such
information is also available upon request to RBC Wealth Management Publishing,
60 South Sixth St, Minneapolis, MN 55402.
References to a Recommended List in the recommendation history chart may
include one or more recommended lists or model portfolios maintained by RBC
Wealth Management or one of its affiliates. RBC Wealth Management recommended
lists include the Guided Portfolio: Prime Income (RL 6), the Guided Portfolio: Large
Cap (RL 7), the Guided Portfolio: Dividend Growth (RL 8), the Guided Portfolio:
Midcap 111 (RL9), the Guided Portfolio: ADR (RL 10), and the Guided Portfolio:
Global Equity (U.S.) (RL 11). RBC Capital Markets recommended lists include the
Strategy Focus List and the Fundamental Equity Weightings (FEW) portfolios. The
abbreviation ‘RL On’ means the date a security was placed on a Recommended
List. The abbreviation ‘RL Off’ means the date a security was removed from a
Recommended List.
GLOBAL INSIGHT WEEKLY
An analyst’s “sector” is the universe of companies for which the analyst provides
research coverage. Accordingly, the rating assigned to a particular stock represents
solely the analyst’s view of how that stock will perform over the next 12 months
relative to the analyst’s sector average. Although RBC Capital Markets, LLC ratings of
Top Pick (TP)/Outperform (O), Sector Perform (SP), and Underperform (U) most closely
correspond to Buy, Hold/Neutral and Sell, respectively, the meanings are not the same
because our ratings are determined on a relative basis (as described below).
Ratings:
Top Pick (TP): Represents analyst’s best idea in the sector; expected to provide
significant absolute total return over 12 months with a favorable risk-reward ratio.
Outperform (O): Expected to materially outperform sector average over
12 months.
Sector Perform (SP): Returns expected to be in line with sector average over
12 months.
Underperform (U): Returns expected to be materially below sector average over
12 months.
Risk Rating:
As of March 31, 2013, RBC Capital Markets, LLC suspends its Average and Above
Average risk ratings. The Speculative risk rating reflects a security’s lower level of
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The analyst(s) responsible for preparing this research report received compensation
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March 27, 2015
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general circulation and does not take into account the objectives, financial situation,
The information contained in this report has been compiled by RBC Wealth
or needs of any recipient. You are advised to seek independent advice from a financial
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accuracy, completeness or correctness. All opinions and estimates contained in this
Copyright © RBC Capital Markets, LLC 2015 - Member NYSE/FINRA/SIPC
report constitute RBC Wealth Management’s judgment as of the date of this report,
Copyright © RBC Dominion Securities Inc. 2015 - Member CIPF
are subject to change without notice and are provided in good faith but without
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returns are not guaranteed, and a loss of original capital may occur. Every province
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GLOBAL INSIGHT WEEKLY
March 27, 2015
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