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ALTAGAS LTD - ALACN 5.38 PERP (ALA-PR-B.CA) Stock Fundamental Analysis

TSX:ALA-PR-B - Toronto Stock Exchange - CA0213613080 - Currency: CAD

22.99  +0.47 (+2.09%)

Fundamental Rating

5

Taking everything into account, ALA-PR-B scores 5 out of 10 in our fundamental rating. ALA-PR-B was compared to 8 industry peers in the Gas Utilities industry. There are concerns on the financial health of ALA-PR-B while its profitability can be described as average. ALA-PR-B is not valued too expensively and it also shows a decent growth rate.


Dividend Valuation Growth Profitability Health

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5

1. Profitability

1.1 Basic Checks

ALA-PR-B had positive earnings in the past year.
ALA-PR-B had a positive operating cash flow in the past year.
Each year in the past 5 years ALA-PR-B has been profitable.
In the past 5 years ALA-PR-B always reported a positive cash flow from operatings.
ALA-PR-B.CA Yearly Net Income VS EBIT VS OCF VS FCFALA-PR-B.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-B has a better Return On Assets (1.97%) than 85.71% of its industry peers.
ALA-PR-B's Return On Equity of 6.08% is amongst the best of the industry. ALA-PR-B outperforms 85.71% of its industry peers.
The Return On Invested Capital of ALA-PR-B (3.28%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for ALA-PR-B 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-B.CA Yearly ROA, ROE, ROICALA-PR-B.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-B's Profit Margin of 3.91% is amongst the best of the industry. ALA-PR-B outperforms 85.71% of its industry peers.
In the last couple of years the Profit Margin of ALA-PR-B has declined.
Looking at the Operating Margin, with a value of 7.47%, ALA-PR-B is in line with its industry, outperforming 57.14% of the companies in the same industry.
In the last couple of years the Operating Margin of ALA-PR-B has declined.
With a Gross Margin value of 24.89%, ALA-PR-B perfoms like the industry average, outperforming 57.14% of the companies in the same industry.
ALA-PR-B's Gross Margin has declined in the last couple of years.
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-B.CA Yearly Profit, Operating, Gross MarginsALA-PR-B.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

ALA-PR-B has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for ALA-PR-B has been increased compared to 1 year ago.
ALA-PR-B has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, ALA-PR-B has an improved debt to assets ratio.
ALA-PR-B.CA Yearly Shares OutstandingALA-PR-B.CA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M 200M 250M
ALA-PR-B.CA Yearly Total Debt VS Total AssetsALA-PR-B.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-B has an Altman-Z score of 0.84. This is a bad value and indicates that ALA-PR-B is not financially healthy and even has some risk of bankruptcy.
ALA-PR-B has a Altman-Z score of 0.84. This is in the better half of the industry: ALA-PR-B outperforms 71.43% of its industry peers.
A Debt/Equity ratio of 1.22 is on the high side and indicates that ALA-PR-B has dependencies on debt financing.
With a decent Debt to Equity ratio value of 1.22, ALA-PR-B is doing good in the industry, outperforming 71.43% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 1.22
Debt/FCF N/A
Altman-Z 0.84
ROIC/WACC0.65
WACC5.06%
ALA-PR-B.CA Yearly LT Debt VS Equity VS FCFALA-PR-B.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-B should not have too much problems paying its short term obligations.
The Current ratio of ALA-PR-B (1.03) is better than 71.43% of its industry peers.
ALA-PR-B has a Quick Ratio of 1.03. This is a bad value and indicates that ALA-PR-B is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.79, ALA-PR-B is in line with its industry, outperforming 57.14% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.03
Quick Ratio 0.79
ALA-PR-B.CA Yearly Current Assets VS Current LiabilitesALA-PR-B.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

ALA-PR-B shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 22.60%, which is quite impressive.
ALA-PR-B shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.00% yearly.
The Revenue has decreased by -8.30% in the past year.
The Revenue has been growing by 25.01% on average over the past years. This is a very strong growth!
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

Based on estimates for the next years, ALA-PR-B will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.91% on average per year.
ALA-PR-B is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.17% yearly.
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
ALA-PR-B.CA Yearly Revenue VS EstimatesALA-PR-B.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-B.CA Yearly EPS VS EstimatesALA-PR-B.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 10.59, the valuation of ALA-PR-B can be described as reasonable.
ALA-PR-B's Price/Earnings ratio is rather cheap when compared to the industry. ALA-PR-B is cheaper than 85.71% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.35, ALA-PR-B is valued rather cheaply.
ALA-PR-B is valuated reasonably with a Price/Forward Earnings ratio of 10.21.
85.71% of the companies in the same industry are more expensive than ALA-PR-B, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of ALA-PR-B to the average of the S&P500 Index (22.10), we can say ALA-PR-B is valued rather cheaply.
Industry RankSector Rank
PE 10.59
Fwd PE 10.21
ALA-PR-B.CA Price Earnings VS Forward Price EarningsALA-PR-B.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-B's Enterprise Value to EBITDA is on the same level as the industry average.
Industry RankSector Rank
P/FCF N/A
EV/EBITDA 11.58
ALA-PR-B.CA Per share dataALA-PR-B.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.
PEG (NY)0.77
PEG (5Y)0.66
EPS Next 2Y9.16%
EPS Next 3Y9.46%

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4

5. Dividend

5.1 Amount

ALA-PR-B has a Yearly Dividend Yield of 3.50%. Purely for dividend investing, there may be better candidates out there.
ALA-PR-B's Dividend Yield is comparable with the industry average which is at 3.55.
ALA-PR-B's Dividend Yield is a higher than the S&P500 average which is at 2.33.
Industry RankSector Rank
Dividend Yield 3.5%

5.2 History

The dividend of ALA-PR-B decreases each year by -13.07%.
ALA-PR-B has been paying a dividend for at least 10 years, so it has a reliable track record.
ALA-PR-B has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-13.07%
Div Incr Years3
Div Non Decr Years3
ALA-PR-B.CA Yearly Dividends per shareALA-PR-B.CA Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.5 1 1.5

5.3 Sustainability

74.59% of the earnings are spent on dividend by ALA-PR-B. This is not a sustainable payout ratio.
DP74.59%
EPS Next 2Y9.16%
EPS Next 3Y9.46%
ALA-PR-B.CA Yearly Income VS Free CF VS DividendALA-PR-B.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-B.CA Dividend Payout.ALA-PR-B.CA Dividend Payout, showing the Payout Ratio.ALA-PR-B.CA Dividend Payout.PayoutRetained Earnings

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ALTAGAS LTD - ALACN 5.38 PERP

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

22.99

+0.47 (+2.09%)

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 Cap6.85B
Analysts75.71
Price Target25.67 (11.66%)
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 Years3
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)-1.97%
PT rev (3m)4.24%
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 10.59
Fwd PE 10.21
P/S 0.55
P/FCF N/A
P/OCF 5.79
P/B 0.85
P/tB 2.7
EV/EBITDA 11.58
EPS(TTM)2.17
EY9.44%
EPS(NY)2.25
Fwd EY9.8%
FCF(TTM)-0.24
FCFYN/A
OCF(TTM)3.97
OCFY17.29%
SpS41.88
BVpS26.93
TBVpS8.52
PEG (NY)0.77
PEG (5Y)0.66
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 0.84
F-Score6
WACC5.06%
ROIC/WACC0.65
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