Aecon Group, Inc. (ARE) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

SNC-Lavalin Group, Inc.

ADF Group, Inc.

Stantec, Inc.

Bird Construction, Inc.

WSP Global, Inc.

Aecon Group, Inc.

Badger Infrastructure Solutions Ltd.

Brookfield Business Corp.

Foraco International SA

SolarBank Corp.

Spark Power Group, Inc.

Why is Aecon Group, Inc. ?

Poor Management Efficiency with a low ROE of 6.90%

The company has been able to generate a Return on Equity (avg) of 6.90% signifying low profitability per unit of shareholders funds

Poor long term growth as Operating profit has grown by an annual rate -9.75% of over the last 5 years

Positive results in Mar 26

OPERATING CASH FLOW(Y) Highest at CAD 266.45 MM
RAW MATERIAL COST(Y) Fallen by -904.08% (YoY)
INVENTORY TURNOVER RATIO(HY) Highest at 241.71 times

With ROE of 1.90%, it has a expensive valuation with a 2.72 Price to Book Value

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 116.39%, its profits have risen by 120.4% ; the PEG ratio of the company is 1.2

Majority shareholders : FIIs

Consistent Returns over the last 3 years

Along with generating 116.39% returns in the last 1 year, the stock has outperformed S&P/TSX 60 in each of the last 3 annual periods

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Aecon Group, Inc. should be less than 10%
Overall Portfolio exposure to Construction should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Construction)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Aecon Group, Inc. for you?

High Risk, High Return

Absolute

Risk Adjusted

Volatility

Aecon Group, Inc.

116.39%

5.24

39.43%

S&P/TSX 60

29.6%

2.31

12.81%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

9.05%

EBIT Growth (5y)

-9.75%

EBIT to Interest (avg)

0.83

Debt to EBITDA (avg)

0.94

Net Debt to Equity (avg)

0.12

Sales to Capital Employed (avg)

3.40

Tax Ratio

20.08%

Dividend Payout Ratio

316.40%

Pledged Shares

Institutional Holding

0.07%

ROCE (avg)

5.54%

ROE (avg)

6.90%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

143

Industry P/E

Price to Book Value

2.72

EV to EBIT

38.57

EV to EBITDA

15.97

EV to Capital Employed

2.71

EV to Sales

0.52

PEG Ratio

1.19

Dividend Yield

ROCE (Latest)

7.04%

ROE (Latest)

1.90%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

RSI

Bearish

No Signal

Bollinger Bands

Bullish

Moving Averages

Bullish (Daily)

KST

Bullish

Dow Theory

Bullish

OBV

Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

13What is working for the Company

OPERATING CASH FLOW(Y)

Highest at CAD 266.45 MM

RAW MATERIAL COST(Y)

Fallen by -904.08% (YoY

INVENTORY TURNOVER RATIO(HY)

Highest at 241.71 times

DEBTORS TURNOVER RATIO(HY)

Highest at 2.78 times

PRE-TAX PROFIT(Q)

At CAD -15.66 MM has Grown at 69.56%

NET PROFIT(Q)

At CAD -16.86 MM has Grown at 58.47%

-4What is not working for the Company

INTEREST(HY)

At CAD 28.4 MM has Grown at 14.11%

Here's what is working for Aecon Group, Inc.

Operating Cash Flow

Highest at CAD 266.45 MM

in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (CAD MM)

Pre-Tax Profit

At CAD -15.66 MM has Grown at 69.56%

Year on Year (YoY)

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (CAD MM)

Net Profit

At CAD -16.86 MM has Grown at 58.47%

Year on Year (YoY)

MOJO Watch

Near term Net Profit trend is positive

Net Profit (CAD MM)

Inventory Turnover Ratio

Highest at 241.71 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its inventory faster

Inventory Turnover Ratio

Debtors Turnover Ratio

Highest at 2.78 times

in the last five Semi-Annual periods

MOJO Watch

Company has been able to sell its Debtors faster

Debtors Turnover Ratio

Raw Material Cost

Fallen by -904.08% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Here's what is not working for Aecon Group, Inc.

Interest

At CAD 28.4 MM has Grown at 14.11%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (CAD MM)