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ALTAGAS LTD - ALACN 3.06 PERP (ALA-PR-A.CA) Stock Fundamental Analysis

TSX:ALA-PR-A - Toronto Stock Exchange - CA0213612090 - Currency: CAD

21.15  +0.05 (+0.24%)

Fundamental Rating

5

Taking everything into account, ALA-PR-A scores 5 out of 10 in our fundamental rating. ALA-PR-A was compared to 8 industry peers in the Gas Utilities industry. There are concerns on the financial health of ALA-PR-A while its profitability can be described as average. ALA-PR-A has a correct valuation and a medium growth rate.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

In the past year ALA-PR-A was profitable.
In the past year ALA-PR-A had a positive cash flow from operations.
ALA-PR-A had positive earnings in each of the past 5 years.
ALA-PR-A had a positive operating cash flow in each of the past 5 years.
ALA-PR-A.CA Yearly Net Income VS EBIT VS OCF VS FCFALA-PR-A.CA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 500M -500M 1B -1B

1.2 Ratios

ALA-PR-A's Return On Assets of 1.97% is amongst the best of the industry. ALA-PR-A outperforms 100.00% of its industry peers.
With an excellent Return On Equity value of 6.08%, ALA-PR-A belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
ALA-PR-A has a Return On Invested Capital of 3.28%. This is in the better half of the industry: ALA-PR-A outperforms 71.43% of its industry peers.
ALA-PR-A had an Average Return On Invested Capital over the past 3 years of 3.47%. This is below the industry average of 7.05%.
Industry RankSector Rank
ROA 1.97%
ROE 6.08%
ROIC 3.28%
ROA(3y)1.82%
ROA(5y)2.32%
ROE(3y)5.66%
ROE(5y)6.91%
ROIC(3y)3.47%
ROIC(5y)2.68%
ALA-PR-A.CA Yearly ROA, ROE, ROICALA-PR-A.CA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 5 -5 10

1.3 Margins

ALA-PR-A has a Profit Margin of 3.91%. This is amongst the best in the industry. ALA-PR-A outperforms 100.00% of its industry peers.
ALA-PR-A's Profit Margin has declined in the last couple of years.
ALA-PR-A has a better Operating Margin (7.47%) than 71.43% of its industry peers.
In the last couple of years the Operating Margin of ALA-PR-A has declined.
Looking at the Gross Margin, with a value of 24.89%, ALA-PR-A is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
In the last couple of years the Gross Margin of ALA-PR-A has declined.
Industry RankSector Rank
OM 7.47%
PM (TTM) 3.91%
GM 24.89%
OM growth 3Y-15.76%
OM growth 5YN/A
PM growth 3Y-17.23%
PM growth 5YN/A
GM growth 3Y-19.85%
GM growth 5Y-12.11%
ALA-PR-A.CA Yearly Profit, Operating, Gross MarginsALA-PR-A.CA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20 40

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3

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ALA-PR-A is destroying value.
Compared to 1 year ago, ALA-PR-A has more shares outstanding
ALA-PR-A has more shares outstanding than it did 5 years ago.
ALA-PR-A has a better debt/assets ratio than last year.
ALA-PR-A.CA Yearly Shares OutstandingALA-PR-A.CA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M 200M 250M
ALA-PR-A.CA Yearly Total Debt VS Total AssetsALA-PR-A.CA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 5B 10B 15B 20B

2.2 Solvency

ALA-PR-A has an Altman-Z score of 0.82. This is a bad value and indicates that ALA-PR-A is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.82, ALA-PR-A perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
A Debt/Equity ratio of 1.22 is on the high side and indicates that ALA-PR-A has dependencies on debt financing.
ALA-PR-A has a Debt to Equity ratio of 1.22. This is amongst the best in the industry. ALA-PR-A outperforms 85.71% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.22
Debt/FCF N/A
Altman-Z 0.82
ROIC/WACC0.66
WACC4.96%
ALA-PR-A.CA Yearly LT Debt VS Equity VS FCFALA-PR-A.CA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 2B 4B 6B 8B

2.3 Liquidity

A Current Ratio of 1.03 indicates that ALA-PR-A should not have too much problems paying its short term obligations.
ALA-PR-A's Current ratio of 1.03 is amongst the best of the industry. ALA-PR-A outperforms 85.71% of its industry peers.
ALA-PR-A has a Quick Ratio of 1.03. This is a bad value and indicates that ALA-PR-A is not financially healthy enough and could expect problems in meeting its short term obligations.
With a decent Quick ratio value of 0.79, ALA-PR-A is doing good in the industry, outperforming 71.43% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.03
Quick Ratio 0.79
ALA-PR-A.CA Yearly Current Assets VS Current LiabilitesALA-PR-A.CA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 1B 2B 3B 4B

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5

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 22.60% over the past year.
ALA-PR-A shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.00% yearly.
Looking at the last year, ALA-PR-A shows a decrease in Revenue. The Revenue has decreased by -8.30% in the last year.
Measured over the past years, ALA-PR-A shows a very strong growth in Revenue. The Revenue has been growing by 25.01% on average per year.
EPS 1Y (TTM)22.6%
EPS 3Y10%
EPS 5Y16%
EPS Q2Q%40%
Revenue 1Y (TTM)-8.3%
Revenue growth 3Y32.5%
Revenue growth 5Y25.01%
Sales Q2Q%-8.94%

3.2 Future

ALA-PR-A is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.91% yearly.
Based on estimates for the next years, ALA-PR-A will show a small growth in Revenue. The Revenue will grow by 0.17% on average per year.
EPS Next Y13.75%
EPS Next 2Y9.16%
EPS Next 3Y9.46%
EPS Next 5Y8.91%
Revenue Next Year-10.88%
Revenue Next 2Y-2.57%
Revenue Next 3Y0.17%
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
ALA-PR-A.CA Yearly Revenue VS EstimatesALA-PR-A.CA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 5B 10B
ALA-PR-A.CA Yearly EPS VS EstimatesALA-PR-A.CA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 0.5 1 1.5 2 2.5

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6

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 9.75, the valuation of ALA-PR-A can be described as reasonable.
Based on the Price/Earnings ratio, ALA-PR-A is valued cheaply inside the industry as 100.00% of the companies are valued more expensively.
ALA-PR-A is valuated cheaply when we compare the Price/Earnings ratio to 29.35, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 9.39, the valuation of ALA-PR-A can be described as reasonable.
Based on the Price/Forward Earnings ratio, ALA-PR-A is valued cheaper than 100.00% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.10, ALA-PR-A is valued rather cheaply.
Industry RankSector Rank
PE 9.75
Fwd PE 9.39
ALA-PR-A.CA Price Earnings VS Forward Price EarningsALA-PR-A.CA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

ALA-PR-A's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. ALA-PR-A is cheaper than 71.43% of the companies in the same industry.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 11.18
ALA-PR-A.CA Per share dataALA-PR-A.CA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 10 20 30 40

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ALA-PR-A has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)0.71
PEG (5Y)0.61
EPS Next 2Y9.16%
EPS Next 3Y9.46%

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4

5. Dividend

5.1 Amount

ALA-PR-A has a Yearly Dividend Yield of 3.50%.
ALA-PR-A's Dividend Yield is comparable with the industry average which is at 3.55.
Compared to an average S&P500 Dividend Yield of 2.33, ALA-PR-A pays a bit more dividend than the S&P500 average.
Industry RankSector Rank
Dividend Yield 3.5%

5.2 History

The dividend of ALA-PR-A decreases each year by -13.07%.
ALA-PR-A has paid a dividend for at least 10 years, which is a reliable track record.
ALA-PR-A has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-13.07%
Div Incr Years0
Div Non Decr Years3
ALA-PR-A.CA Yearly Dividends per shareALA-PR-A.CA Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.2 0.4 0.6 0.8 1

5.3 Sustainability

74.59% of the earnings are spent on dividend by ALA-PR-A. This is not a sustainable payout ratio.
DP74.59%
EPS Next 2Y9.16%
EPS Next 3Y9.46%
ALA-PR-A.CA Yearly Income VS Free CF VS DividendALA-PR-A.CA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 500M -500M -1B
ALA-PR-A.CA Dividend Payout.ALA-PR-A.CA Dividend Payout, showing the Payout Ratio.ALA-PR-A.CA Dividend Payout.PayoutRetained Earnings

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ALTAGAS LTD - ALACN 3.06 PERP

TSX:ALA-PR-A (3/7/2025, 7:00:00 PM)

21.15

+0.05 (+0.24%)

Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryGas Utilities
Earnings (Last)03-07 2025-03-07/amc
Earnings (Next)04-30 2025-04-30
Inst Owners35.93%
Inst Owner ChangeN/A
Ins Owners0.62%
Ins Owner ChangeN/A
Market Cap6.30B
Analysts75.71
Price Target24.36 (15.18%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 3.5%
Yearly Dividend1.19
Dividend Growth(5Y)-13.07%
DP74.59%
Div Incr Years0
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)38.93%
Min EPS beat(2)23.34%
Max EPS beat(2)54.51%
EPS beat(4)3
Avg EPS beat(4)20.62%
Min EPS beat(4)-3.56%
Max EPS beat(4)54.51%
EPS beat(8)5
Avg EPS beat(8)9.05%
EPS beat(12)7
Avg EPS beat(12)5.04%
EPS beat(16)11
Avg EPS beat(16)256.84%
Revenue beat(2)1
Avg Revenue beat(2)-2.98%
Min Revenue beat(2)-14.32%
Max Revenue beat(2)8.36%
Revenue beat(4)1
Avg Revenue beat(4)-9.76%
Min Revenue beat(4)-20.81%
Max Revenue beat(4)8.36%
Revenue beat(8)2
Avg Revenue beat(8)1.48%
Revenue beat(12)6
Avg Revenue beat(12)32.67%
Revenue beat(16)10
Avg Revenue beat(16)50.12%
PT rev (1m)-2.61%
PT rev (3m)9.51%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.19%
EPS NY rev (1m)-0.01%
EPS NY rev (3m)-1.46%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)-0.07%
Valuation
Industry RankSector Rank
PE 9.75
Fwd PE 9.39
P/S 0.51
P/FCF N/A
P/OCF 5.32
P/B 0.79
P/tB 2.48
EV/EBITDA 11.18
EPS(TTM)2.17
EY10.26%
EPS(NY)2.25
Fwd EY10.65%
FCF(TTM)-0.24
FCFYN/A
OCF(TTM)3.97
OCFY18.79%
SpS41.88
BVpS26.93
TBVpS8.52
PEG (NY)0.71
PEG (5Y)0.61
Profitability
Industry RankSector Rank
ROA 1.97%
ROE 6.08%
ROCE 4.29%
ROIC 3.28%
ROICexc 3.4%
ROICexgc 4.57%
OM 7.47%
PM (TTM) 3.91%
GM 24.89%
FCFM N/A
ROA(3y)1.82%
ROA(5y)2.32%
ROE(3y)5.66%
ROE(5y)6.91%
ROIC(3y)3.47%
ROIC(5y)2.68%
ROICexc(3y)3.48%
ROICexc(5y)2.69%
ROICexgc(3y)4.77%
ROICexgc(5y)3.7%
ROCE(3y)4.51%
ROCE(5y)3.48%
ROICexcg growth 3Y8.69%
ROICexcg growth 5YN/A
ROICexc growth 3Y9.85%
ROICexc growth 5YN/A
OM growth 3Y-15.76%
OM growth 5YN/A
PM growth 3Y-17.23%
PM growth 5YN/A
GM growth 3Y-19.85%
GM growth 5Y-12.11%
F-Score6
Asset Turnover0.5
Health
Industry RankSector Rank
Debt/Equity 1.22
Debt/FCF N/A
Debt/EBITDA 7.03
Cap/Depr 271.86%
Cap/Sales 10.07%
Interest Coverage 250
Cash Conversion 84.94%
Profit Quality N/A
Current Ratio 1.03
Quick Ratio 0.79
Altman-Z 0.82
F-Score6
WACC4.96%
ROIC/WACC0.66
Cap/Depr(3y)208.32%
Cap/Depr(5y)226.65%
Cap/Sales(3y)7.25%
Cap/Sales(5y)12.23%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)22.6%
EPS 3Y10%
EPS 5Y16%
EPS Q2Q%40%
EPS Next Y13.75%
EPS Next 2Y9.16%
EPS Next 3Y9.46%
EPS Next 5Y8.91%
Revenue 1Y (TTM)-8.3%
Revenue growth 3Y32.5%
Revenue growth 5Y25.01%
Sales Q2Q%-8.94%
Revenue Next Year-10.88%
Revenue Next 2Y-2.57%
Revenue Next 3Y0.17%
Revenue Next 5YN/A
EBIT growth 1Y16.35%
EBIT growth 3Y11.63%
EBIT growth 5YN/A
EBIT Next Year30.54%
EBIT Next 3Y12.65%
EBIT Next 5Y8.88%
FCF growth 1Y62.69%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y76.98%
OCF growth 3Y13.19%
OCF growth 5YN/A