Canadian Prime Minister Mark Carney is scheduled to meet with U.S. President Donald Trump in Washington, D.C. next week as the two countries prepare to renegotiate their trade agreement.
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The meeting will be Carney’s second in-person meeting with Trump since becoming Canada’s prime minister this spring. The latest visit comes as Canadian and American officials prepare to reopen and review the Canada-U.S.-Mexico Agreement on Trade (CUSMA), which replaced the previous North American Free Trade Agreement (NAFTA) during Trump’s first term in office.
Trump implemented sweeping tariffs on Canadian goods in February, though his administration has since carved out exemptions for imports that are compliant with the current free trade agreement between the two countries. Still, the U.S. maintains a 25% tariff on Canadian products such as steel and aluminum. Most recently, Trump imposed new import duties on Canadian lumber.
The tariffs are causing an economic slowdown in Canada and weighing on leading Canadian stocks such as Shopify (SHOP), Air Canada (AC), and Lululemon Athletica (LULU).
Improving Relations
Carney has said repeatedly that he wants to improve relations between Canada and the U.S., which polls show to be at a decades-low. Negotiations between the two countries aimed at a new economic and security deal have been ongoing for months. Prime Minister Carney has said his priority is to get the best deal for Canada rather than a quick one.
In September, Carney announced that Canada is dropping many of its counter-tariffs on U.S. goods covered under the CUSMA trade deal. Asked by reporters at the time whether President Trump had assured him that dropping many counter-tariffs would help with U.S. trade negotiations, the prime minister responded “yes.”
Is AC Stock a Buy?
Air Canada’s stock has a consensus Strong Buy rating among 12 Wall Street analysts. That rating is based on nine Buy and three Hold recommendations issued in the last three months. The average AC price target of C$24.69 implies 36.56% upside from current levels.
