Futures higher, crypto in shambles, Dell falls, Pembina hitches to AI wagon
This self-proclaimed moon girl will be levelling up today. All seven planets will line up in the sky tonight for the last time until 2040. In Toronto, get out there by 6:15pmET to see Saturn and Mercury before they disappear around 6:40pmET. You should be able to see Venus, Mars, Jupiter and Saturn from the sky.
Don’t miss our latest episode of In the Money with Amber Kanwar now on YouTube! Watch our full interview with Dean Orrico of Middlefield as he explains why he thinks Canadian REITs are the best buy in his 20+ year career.
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On/off: Futures are indicating a tentative recovery this morning after markets plunged yesterday on tariff threats. The NASDAQ fell nearly 3% and put in its worst showing in a month. It is in the red for the year while all US markets and the TSX are poised to end the month lower. Crypto is falling apart. The S&P 500 is down nearly 5% from its all-time high and has given up all its post-election gains. The TSX has held up better, down only 3% from all-time highs. Yesterday, US President Donald Trump said 25% tariffs on Canadian goods will indeed come into effect on March 4th. He also said an additional 10% would be applied to China. “It’s unclear just how much room for negotiations remains,” wrote BMO economist Shelly Kaushik, “…All that to say it could come down to the wire yet again. And that’s just making the decisions… the reality is that implementation might take even longer.” This morning we will get a read of GDP in Canada for the fourth quarter and December. In the US, we will get a read of the Fed’s preferred inflation gauge.
Reboot: Dell is down 6% in the pre-market even as the computer and server maker beat profit expectations. It also said that demand for its AI servers is so robust they expect a 50% jump in sales to $15 billion this year. So why is the stock down? Even though sales are going to increase, the company warned that margins are going to fall this year. This scratches an old itch that Dell can’t figure out how to play in the AI server game profitably. Sales in the quarter were also lighter than expected with total sales increasing less than hoped and AI servers bringing in less ($2.1 billion vs. $2.7 billion expected). Price targets are coming down, but analysts are sticking with their buy rating. “With management typically guiding conservatively at the start of the year, we remain constructive given the guide for continued revenue and EPS growth above their long-term framework,” wrote Citi’s Asiya Merchant.
Pipe dream: Watch shares of Pembina Pipeline at the open after it reported better than expected profit and touted growth from AI. That’s right, a pipeline company is now an AI play. Pembina announced a joint venture for a power plant in Alberta in order to support data centre demand. TD says this is the real deal. “A data center deal was not on our bingo card,” wrote TD’s Aaron MacNeil. “…Pembina now has among the most direct exposure to the data center thematic among companies in our coverage universe.” Or as Raymond James analyst Michael Barth put it, “Data Center vibes — woot woot!”
Bringing up the rear: Laurentian Bank is the last of the banks to report results and managed to follow the trend of beating expectations. While profit rose from last year, total sales fell on lower fees. Shares haven’t done much over the past year but are down 36% from 2023 on a failed attempt to be bought out. Investors may not give the embattled bank credit for beating earnings because it was aided by releasing funds from provisions for loans that could go bad. “Significant (provisions) release during uncertainty will be questioned,” wrote RBC’s Darko Mihelic.
Immune boost: Watch shares of vitamin maker Jamieson Wellness at the open. Sales didn’t grow as much as expected but profit was light. This one has come under pressure so far in 2025 in part because of the threat of tariffs. It’s forecast for 2025 sales was also lighter than expected. Stifel thinks the underperformance in the stock so far this year could prevent a major downdraft today. “We see misconceptions of the tariff impact,” wrote Stifel’s Justin Keywood, “We estimate about 10% of sales could be impacted but related to the relatively low-margin, strategic partners segment and small, <3% impact to overall EBITDA.”
