The IDBI Ltd. bank headquarters in Mumbai, India, on Friday, Oct. 21, 2022. Photo by Indranil Aditya/Bloomberg

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Which stocks are CIBC’s top picks to navigate volatile gold and silver prices, what are TD’s energy infrastructure picks and more from The Week in Stocks.

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Stock of the week: Fairfax Financial Holdings Ltd.

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Fairfax Financial Holdings Ltd. (FFH:TSX) finished this week among the TSX’s top 10 gainers, up nearly eight per cent after the Toronto-based conglomerate led by billionaire Prem Watsa announced a deal for a controlling stake in India-based IDBI Bank Ltd. “The investment is a long-term play on the high-growth potential of India and its banking industry,” Phil Hardie, an analyst at Scotia Capital Markets said in a note on Oct. 15. He has a 12-month price target on Fairfax of $2,950. RBC Capital Markets analyst Bart Dziarski cut his price target to $3,170.85 from $3,260.11 on the news while BMO Capital Markets analyst Tom MacKinnon hiked his price target to $2,700 from $2,500. Shares closed Friday at $2,403.11. Scotia’s Hardie said there was concern the IDBI deal would muddle Fairfax’s efforts to be viewed more as an insurance company than a investment conglomerate. But since the announcement, management clarified its plans to expand its offerings with a growing Indian insurance company and an established provider of investment banking and wealth management services, he said. The deal has been approved by the government of India, but still requires other approvals. It is expected to close in the first quarter of 2027 or sooner, Hardie said. Shares of Fairfax have a price target of $2,910.12 based on the calls of seven analysts, according to Bloomberg.

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Keeping score

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TD’s energy infrastructure picks as earnings loom

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Energy earnings season is nearing and TD Cowen analysts said in a note on Oct. 16 that they favour TC Energy Corp. (TRP:TSX) in the infrastructure sector as they expect the pipeline giant to make project announcements including on the Canadian NGTL system, and the Crossroads and other U.S. natural gas projects. TD Cowen analyst Aaron MacNeil hiked his price target slightly for TC Energy to $103 from $102, saying investors should focus more on the updates for 2027 and possible final investment decisions rather than earnings, which will be released on Oct. 30. Shares closed Friday at $87.13 and are up 15.3 per cent year to date. Shares got a boost when the company announced a deal on Oct. 13 with five Indigenous groups to sell them a share of the company’s stake in the Coastal GasLinkpipeline, which feeds the LNG Canada terminal on the B.C. coast. Still, risks lurk for the energy infrastructure sector including higher interest rates, which make debt-funded projects more expensive. Infrastructure stocks typically perform poorly as rates rise, MacNeil said. TD also hiked its price targets for Keyera Corp. (KEY:TSX) ($70 from $67), Pembina Pipeline Corp. (PPL:TSX) ($79 from $77), Gibson Energy Inc. (GEI:TSX) ($36 from $35) and Enbridge Inc. (ENB:TSX) ($83 from $81). Analysts cut the target for South Bow Corp. (OSOBO:TSX) to $52 from $53.

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CIBC’s top stock picks to navigate volatile gold and silver prices

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Gold and silver prices fell 5.4 per cent and 14.1 per cent in the third quarter, presenting a challenge for precious metals miners, CIBC Capital Markets said in a report on Oct. 15. “We expect softer production and higher costs for many,” Anita Soni, an analyst at CIBC said. It cut its price forecasts for the two metals, but also offered up its top picks for investors who want exposure to the sector but are risk averse. Among those names are Agnico Eagle Mines Ltd. (AEM:TSX). Its price target was cut to $339 from $298. Shares closed Friday at $267.50. Newmont Corp.’s (NEM:NYSE) price target was cut to US$154 from US$170. Shares closed Friday at US$118.60. Other names on the risk-averse roster included Wheaton Precious Metals Corp. (WPM:TSX), Pan American Silver Corp. (PAAS:TSX), Franco-Nevada Corp. (FNV:TSX) and Snowline Gold Corp. (SGD:TSX). CIBC analysts said they favour Kinross Gold Corp. (K:TSX), IAMGOLD Corp. (IMG:TSX), B2Gold Corp. (BTO:TSX), Alamos Gold Inc. (AGI:TSX), Orezone Gold Corp. (ORE:TSX) and Discovery Mining Ltd. (DSV:TSX) for those looking for more leverage. Other gold names not in the top picks list that saw their price targets increase were Allied Gold Corp. (AAUC), going to $40 from $39, and Aya Gold & Silver Inc. (AYA:TSX), rising to $55 from $48. Shares closed Friday at $29.65 and $37.64, respectively.