Hope you enjoyed the long weekend! In this one we catch up on everything we missed over the break - back to business as usual on Friday. 🤝

June’s trade surplus of $3.9B came in better than expected, edging higher over last month…

… on the back of a weaker Canadian Peso, which saw its largest monthly drawdown since 2022 - artificially inflating imports and exports (down ~2% on a USD basis).

At the category level, a ~17% gain in mineral product shipments (mostly gold to the UK) drove the small rise in exports…

…. while a broad-based decline in imports was offset by a ~12% rise in electronics…

… driven by a near-60% jump in processing units, which hit a new record thanks to the never ending appetite from data centers.

Couche-Tard (ATD) found a home for some of its previous Seven & i budget, announcing an $8.6B bid for Poland-based Zabka Group on Friday - which values the target at 7.5x EBITDA after synergies…

… and represents a meaningful expansion in ATD’s store network.

Should the deal get over the finish line, Couche-Tard’s revenue mix will shift meaningfully towards Europe and convenience stores…

… which are more profitable and less volatile than the company’s fuel business (a recent source of strength given the geopolitical backdrop)…

… providing ample cash flow for de-leveraging, with management expecting to return from 3.0x post-close to sub-2.5x within two years.

GDP in May topped expectations, increasing 0.3%…

… on the back of a 0.6% rise in goods-producing industries, which carried 0.2% growth in services GDP.

At the sector level, resource extraction remains the primary driver (up 7%)…

… but it gave up some momentum versus April, which should continue into June - reflecting weaker oil prices after the initial ceasefire in Iran.

Despite that, preliminary estimates for June are calling for 0.2% growth - led by wholesale/retail trade and financial services.

TELUS (T) lost over 10% after ripping off the band-aid, cutting the dividend by 55% alongside Q2 results - which should free up billions in free cash to support leverage reduction plans…

… so the company can refocus on sustainable growth, as it and the rest of the industry contend with the impact of population pressure on top line numbers.

In our view, the selloff was likely driven more by the magnitude than the cut itself and with shares trading at a trough multiple without the overhang…

… I wouldn’t be surprised if we weren’t at or near lows, with Victor Dodig now in the driver’s seat.

Telesat (TSAT) ripped nearly 50% after announcing a $2.3B military contract, which could climb to $2.7B if purchase options are exercised. That prompted a near-50% expansion in the planned size of TSAT’s Lightspeed network…

… so the rally in shares isn’t hype-driven, given its LEO constellation is the only source of terminal value being priced in today…

… with management now calling for $4.9B of revenue from the network by 2032 (was $3.2B), underpinned by defense demand for its recently added Mil-Ka band.

MDA Space (MDA) sits downstream from that demand as Telesat’s manufacturer, with shares up 13% on its $474M backlog addition tied to the expansion…

… which should push the order book up by ~30% in conjunction with its recent $688M Canadian Space Agency contract.

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