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many notes below from Andrew L. de Courcy-Ireland, CIM, FCSI
Portfolio Manager CANACCORD CAPITALTel: (514) 844-5520

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2008

Monday 11 August 2008 (CTC.A : TSX : $54.00)forecasting 2% decline in same-store sales
Credit Suisse First Boston maintains "outperform", 12-month target price is $68.00

Monday 11 August 2008 (CTC.A : TSX : $50.01) Q2/08 results below expectations
BMO Nesbitt Burns maintains "underperform", 12-month target price lowered to $42.00
Desjardins Securities maintains "buy", 12-month target price is $64.00
Raymond James maintains "market perform", 6-12-month target price lowered to $55.00
RBC Capital Markets maintains "outperform", 12-month target price is $76.00

Friday Aug 8, 2008 Conditions tougher than anticipated
Lousy weather and overambitious predictions about the economy took a toll on Canadian Tire Corp. in the second quarter as...

Monday 04 August 2008 (CTC.A : TSX : $54.20) forecasting 2% decline in same-store sales
Credit Suisse First Boston maintains "outperform", 12-month target price is $68.00

Monday 21 July 2008 (CTC.A : TSX : $53.64)
2009 EBITDA forecast lowered primarily on reduced prices
Credit Suisse First Boston maintains "outperform", 12-month target price decreased to $68.00

Tuesday 15 July 2008 (CTC.A : TSX : $51.53)
Moderate earnings and target due to tepid consumer spending environment
RBC Capital Markets maintains "outperform", 12-month target price decreased to $78.00

Monday 12 May 2008 Canadian Tire Corporation (CTC.A : TSX : $63.10)
Operating revenues increase on higher credit interests, management maintains guidance, indicates Q1 in line with outlook
BMO Nesbitt Burns maintains "underperform", 12-month target price is cut to $55.00
Credit Suisse First Boston maintains "outperform", 12-month target price is $75.00
Desjardins Securities maintains "buy", 12-month target price is cut to $77.00
Raymond James maintains "market perform", 6-12 month target price is $70.00
RBC Capital Markets maintains "outperform", 12-month target price is $83.00

Thursday 08 May 2008 (CTC.A : TSX : $65.71) Q1/08 preview, attractive valuation
RBC Capital Markets reiterates "outperform", 12-month target price is $83.00

Wednesday 07 May 2008 CTC.A : TSX : $65.87) Q1/08 preview
Credit Suisse First Boston maintains "outperform", 12-month target price is $75.00

Wednesday 07 May 2008 (CTC.A): $65.88 – Road Warriors: Q1/08 Preview
Outperform, Average Risk, Price Target: $83.00
Canadian Tire will report Q1/08 results tomorrow, May 8th. While most retailers suffered as a result of the extremely seasonal winter weather, Canadian Tire – the "go to" retailer when winter hits - may prove to be one of the few retailers to benefit. Investors will be watching the same store sales performance, as the negative postings from the prior two quarters have been a factor behind the share price performance. Q1 is the smallest of the year, typically generating in the range of 16% of annual earnings. RBC CM is forecasting a 2% rise in EPS to $0.84 (consensus $0.82), with EBITDA growth of 7% to $178.5 million, driven by modest gains in both retail and financial services. At the October 2007 Investor Event, CTC management outlined initiatives in each of its operating units to improve productivity and profitability. As we move through this challenging period of slowing consumer spending, these initiatives should enable CTC to generate solid earnings growth despite the challenging environment and position the Company for margin gains as the macro environment improves. While RBC CM overall forecast is for flat margins in 2008, the Company should begin to see margin growth return in 2009 and accelerate in 2010. CTC is trading toward the low end of its historical trading range and RBC CM view the current share price as an attractive entry point. Target generated by applying a 15x (toward the high-end of CTC's long-term valuation range, reflecting greater visibility and predictability of earnings) to mid-2009E EPS of $5.51.

Tuesday 06 May 2008 (CTC.A : TSX : $66.28)Earnings preview
Scotia Capital maintains "sector perform", 1-year target price of $74.00

Friday 28 March 2008 TORONTO: CANADIAN TIRE CATALOGUE DISCONTINUED
Canadian Tire Corp. has announced it will stop publishing its famous catalogue after 80 years. The company says it no longer makes business sense because of the number of Canadians who shop through the Internet. Canadian Tire says it will use the savings to upgrade its own Website. The decision was praised by the ForestEthics environmental group, which noted that catalogues have tremendous negative effects including the clear-cutting of forests to produce them and the energy consumed during manufacturing and delivery. The decision is a blow, however, for Quebecor World, which produced the catalogue. The world's biggest commercial printer went into bankruptcy protection in Canada and the U.S. several weeks ago. The printer said last week it wouldn't contest Economist magazine's effort to terminate its contract with Quebecor later this year.

Monday 11 February 2008 (CTC.A : TSX : $60.68)
Better-than-expected fourth-quarter operating EPS
Desjardins Securities maintains a "buy", target price cut to $80.00
RBC Capital Markets maintains a "outperform", target price is $83.00
Canadian Tire (CTC) was down despite reporting fourth quarter profit rose 15.5%, as the country’s biggest auto parts and household goods retailer said earnings gains in 2008 will be “tempered” by big investments in growth and productivity.

Wednesday 06 February 2008 (CTC.A : TSX : $63.80)
Reopening of asset-backed credit market
Credit Suisse rates a "outperform", target price is $79.00
Scotia Capital Markets rates a "sector perform", 1-year target price is $74.00

Tuesday 29 January 2008 (CTC.A : TSX : $63.00)
A weakening U.S. economy will weight on same-store sales growth
Raymond James maintains "market perform", 6-12 month target price is cut to $65.00

Tuesday 22 January 2008 CTC.A : TSX : $57.00)
Caution going forward, however valuation still attractive
RBC Capital Markets maintains a "outperform", target price cut to $83.00

Canadian Tire (CTC.A): $60.01 – Price Target Revision –Caution Sign Ahead
Outperform, Average Risk, Price Target: $83.00 (prev $99.00)
Moderate earnings expectations and valuation to reflect a slowing economy has led RBC CM to revise its price target for Canadian Tire to $83.00. Canadian Tire's share price is off 32% from its August/07 high of $87.75. In light of the slowdown in consumer spending RBC CM has modified key assumptions in its financial forecasting model while stopping short of modeling an all out recession scenario. RBC CM 2008 EPS forecast declines from $5.60 to $5.25. RBC CM moderated its valuation multiple from 16.5x to 15x forward earnings resulting in an $83 target price. Reflecting an outright recession into its assumptions and applying an 11x P/E multiple, at the low end of CTC's historical trading range - yields a theoretical share value of $55. CTC reports Q4 /07 results on February 7, and RBC CM expects a dividend increase of 10%-12%. At current prices RBC CM views the market treatment of CTC as overdone and views the current share price as a compelling entry point.

Tuesday 04 December 2007 (CTC.A : TSX : $71.86)
Sales performance in Eastern Canada remains a topical issue
Scotia Capital maintains a "sector perform", target of $86.00

2007

Wednesday 28 November 2007 (CTC.A : TSX : $69.62)
No credit concerns
Scotia Capital maintains a "sector perform", target of $86.00

Wednesday 07 November 2007 (CTC.A : TSX : $80.91)
Reporting third-quarter results tomorrow
RBC Capital Markets maintains a "outperform", target price is $99.00

Friday 05 October 2007 Canadian Tire Corporation (CTC.A : TSX : $79.58) Management outlines interal growth and productivity plan
Credit Suisse maintains "outperform", 12-month target price is $88.00
Desjardins Securities maintains "buy", 12-month target price is $90.00
RBC Capital Markets maintains "outperform", 12-month target price is raised to $99.00
Scotia Capital Markets maintains "sector perform", 12-month target price is $90.00

Thursday 04 October 2007 Canadian Tire (CTC.A) - $78.21 - Increasing Price Target
Outperform, Average Risk, Price Target: $99.00 (was $92.00)
The overall message at yesterday’s investor event was unchanged: Canadian Tire's objective is to continue to deliver mid-teens EPS compound annual growth on a consistent basis through a balanced approach to growth that features a combination of top line growth, margin expansion and focus on better returns on invested capital. While management modified its average annual EPS growth objective from "12%-15%" to "double-digit", based on RBC CM’s analysis and the revenue and profitability enhancing initiatives, RBC CM does not believe that management was trying to talk down Street expectations. Rather, management is trying to move away from specific earnings guidance and the need to justify individual year performance that may deviate based on timing of investment decisions.

Yesterday, Canadian Tire held a half-day analyst meeting in Toronto.

• With no major change in strategic direction, the meeting served to reinforce the company's new focus on improving productivity and returns on capital. This focus is being driven by CEO Tom Gauld.
• Management expects annual revenue growth of 6% to 8% through 2012, with growth in all of the company's businesses. Productivity initiatives and the improved economics of the Dealer contract will support double digit earnings growth.
• As we have highlighted over the past six months, profit growth and moderating capital requirements within the next five years will start to produce strong free cash flow. Management confirmed that it will likely have to revisit its share buyback program and/or its dividend policy as it has no plans to reduce debt leverage.
• Canadian Tire is currently trading at 13.8x 2008E EPS. We view the company's valuation as fair and believe Canadian Tire's shares represent a good long-term investment. We reiterate our 2-Sector Perform rating and $90.00 one-year share price target.

General Impressions

• No Major Changes. Yesterday, Canadian Tire hosted a half-day analyst meeting to outline its plans for the 2008 to 2012 time period. Overall, the meeting simply reinforced our views on the company and there were no major changes in strategy. However, it is clear that Tom Gauld's focus on productivity improvement is permeating all of its plans. We continue to believe this focus will reward shareholders as it should lead to improving returns on capital.
• Increased Returns to Shareholders Expected. Over the past six months, we have highlighted the potential for Canadian Tire to become more active in its share buyback program and/or increasing its dividend given the moderating capital requirements, solid credit ratings, and improving productivity post-2008. Management confirmed this view yesterday, however, no changes are expected for at least another two years.
• Continue to View CTC as a Solid Long-Term Investment. With no major changes to the company's plans, we are maintaining our 2007 and 2008 EPS estimates intact at $4.89 and $5.65, respectively. Canadian Tire is currently trading at 13.8x 2008E EPS compared with its mass merchant peers at 14.3x, the home improvement warehouses at 12.4x, and the auto parts retailers at 13.6x. We view the company's valuation as fair and believe Canadian Tire represents a good long-term investment. We reiterate our 2-Sector Perform rating and $90.00 one-year share price target.

  Financial Summary and Impact

• Altering Targets to Reflect Timing Uncertainty. Over the 2008 to 2012 time period, management hopes to achieve 5% average annual unit growth, 6% to 8% annual revenue growth, double digit earnings growth, and exceed 10% return on capital. The company chose to alter its earnings growth outlook from its previous target of 12% to 15% as it believes earnings performance may be more volatile given the uncertain timing of various investments (i.e., banking rollout).
• Virtually No Funding Requirements Beyond Securitization. In Exhibit 2, we outline management's view of the funding requirements to enact its 5-year plan. We note that the company expects its operating cash flow to fund all of its capital needs with the exception of the credit cards receivables growth and refinancing the existing credit securitizations. Gross capital expenditures average $540M per year over the life of the plan, which is slightly lower than the $600M expected in 2007. The company also expects $300M in proceeds from the sale-leaseback of certain assets. This is in line with our forecast. ? No Plans to Delever Capital Structure. With operating cash flow expected to fund all of the company's requirements outside of credit card securitization, the company runs the risk of de-levering the balance sheet. Management, however, indicated that it does not want to reduce leverage. As such, the company will consider ramping up its share buyback program and/or adjusting its dividend policy in the latter part of its 5-year plan.

  Summary of Growth Plans

• Retail. Revenue and profit growth is expected to come from new and renovated stores, productivity improvements, and a more favourable relationship with the Dealers.
• Continued Store Growth. In addition to the continued rollout of the Concept 20/20 store format, the company plans to open a number of smaller-box retail stores in smaller communities. Historically, the store economics haven't worked for a small store. However, with the ability to now combine it with a Mark's store and a gas bar, the economics are more favourable. The company has identified 100 potential markets for this concept. The company is also looking at the next iteration of its Retail store format. While this is still in the early planning stages, the company does not believe it will require expansion of the existing facilities. This suggests the capital requirements will be modest.
• Productivity - Expense Control and Process Improvement. The productivity improvements relate to upgrading IT system capabilities, with improved processes for marketing and merchandising. This is expected to lead to a more responsive organization that will allow revenue to grow, but keep payroll costs in check. There are no major head count reductions planned.
• Dealer Contract. The revised terms of the Dealer contract are expected to provide $400M of incremental pretax profit to CTC over the 2008 to 2014 time frame, with $80M to $100M in 2014 alone. The Dealers will now have to pay more of the marketing costs and will give up some of the growth in profits beyond the 2008 base year. Management believes the Dealers are happy with the arrangement because it eliminated the risk that the company would be even more aggressive when the financial terms of the contract expired in 2009.
• Going Slow on Product Flow Changes. Management has tempered its plan to alter how Dealers order goods from the company. While this is still a goal, management is taking a slower approach. We view this slower approach more positively as we believe there is considerable risk to making such a move. In addition, with the Dealers giving up a certain amount of profits under the new contract, we believe they may be less inclined to make a fundamental change in their business.
• PartSource - Building and Improving Tire's Key Category. With PartSource consistently delivering high single digit same-store sales growth and the company's recently announced plans to upgrade its auto parts infrastructure, we are not surprised to hear the company talk about growing the division to 175 locations by 2012. While it appears this business stands on its own merits, we also believe the renewed growth will help to keep potential entrants from the U.S. (i.e., AutoZone) out of the Canadian market.
• Financial Services - 7% Receivables Growth Outlook Plus Encouraging Banking Test. Canadian Tire continues to see growth in its credit card receivables through increasing average balances and new account acquisitions. The company continues to test new credit cards, such as the Gas Advantage card, a cash back card, and a vacation card. Management expects to add $1.6B in receivables over the next five years or roughly 7% per year. On the retail banking front, the company is encouraged with the results from its test in the Calgary and Kitchener markets and expanded the program to the London market. The company also added the "One-and-Only" product, which consolidates a customer's savings and mortgage accounts to reduce interest costs. This type of product is popular in Australia and England, but has not been used in Canada and management believes it will be a key differentiator for the company. Canadian Tire expects to continue the retail banking test through 2008 before deciding on a national rollout and/or how the business will be structure (i.e., JV or go-italone). Depending on the structure, management does not believe the investments required to grow the retail bank will be any more significant than the current $25M annual investment. In addition, we believe the bank is largely self-funding as deposits are roughly equal to loans.
• Mark's Work Wearhouse - Keeps on Truckin'. Mark's continues to perform well given its focus on providing innovative products to its core customer and expanding its offering to appeal to the female shopper. Management expects to grow its store count by roughly 4% per year to 440 locations by 2012.
• Petroleum. The Petroleum business continues to be viewed as a tool to drive traffic to the Retail stores and increase credit card receivables. As such, the company expects to open 10 to 20 new sites per year and renovate 20 to 25 locations per year.

Canadian Tire

2007