AECON GROUP INC (ARE.CA) Stock Fundamental Analysis
Canada - TSX:ARE - CA00762V1094 - Common Stock
28.49 CAD
+3.83 (+15.53%)
We assign a fundamental rating of 4 out of 10 to ARE. ARE was compared to 7 industry peers in the Construction & Engineering industry. Both the profitability and financial health of ARE have multiple concerns. ARE has a correct valuation and a medium growth rate. ARE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
ARE had positive earnings in the past year.
ARE had a negative operating cash flow in the past year.
Of the past 5 years ARE 4 years were profitable.
The reported operating cash flow has been mixed in the past 5 years: ARE reported negative operating cash flow in multiple years.
1.2 Ratios
With a Return On Assets value of 0.72%, ARE is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
ARE's Return On Equity of 2.81% is on the low side compared to the rest of the industry. ARE is outperformed by 71.43% of its industry peers.
With a Return On Invested Capital value of 2.31%, ARE is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.72% | ||
| ROE | 2.81% | ||
| ROIC | 2.32% |
ROA(3y)1.36%
ROA(5y)1.65%
ROE(3y)4.06%
ROE(5y)5.54%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
ARE has a Profit Margin of 0.51%. This is in the lower half of the industry: ARE underperforms 71.43% of its industry peers.
Looking at the Operating Margin, with a value of 0.94%, ARE is doing worse than 71.43% of the companies in the same industry.
ARE has a worse Gross Margin (7.67%) than 71.43% of its industry peers.
In the last couple of years the Gross Margin of ARE has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.94% | ||
| PM (TTM) | 0.51% | ||
| GM | 7.67% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-22.44%
GM growth 5Y-16.54%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ARE is destroying value.
Compared to 1 year ago, ARE has more shares outstanding
The number of shares outstanding for ARE has been increased compared to 5 years ago.
The debt/assets ratio for ARE is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.15 indicates that ARE is not a great score, but indicates only limited risk for bankruptcy at the moment.
ARE has a worse Altman-Z score (2.15) than 71.43% of its industry peers.
A Debt/Equity ratio of 0.53 indicates that ARE is somewhat dependend on debt financing.
ARE has a better Debt to Equity ratio (0.53) than 85.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.15 |
ROIC/WACC0.26
WACC8.98%
2.3 Liquidity
A Current Ratio of 1.21 indicates that ARE should not have too much problems paying its short term obligations.
ARE has a Current ratio of 1.21. This is comparable to the rest of the industry: ARE outperforms 42.86% of its industry peers.
ARE has a Quick Ratio of 1.20. This is a normal value and indicates that ARE is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.20, ARE is in line with its industry, outperforming 42.86% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
ARE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 238.71%, which is quite impressive.
The Revenue has grown by 20.53% in the past year. This is a very strong growth!
Measured over the past years, ARE shows a small growth in Revenue. The Revenue has been growing by 4.16% on average per year.
EPS 1Y (TTM)238.71%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%95.48%
Revenue 1Y (TTM)20.53%
Revenue growth 3Y2.18%
Revenue growth 5Y4.16%
Sales Q2Q%52.45%
3.2 Future
Based on estimates for the next years, ARE will show a very strong growth in Earnings Per Share. The EPS will grow by 50.62% on average per year.
Based on estimates for the next years, ARE will show a quite strong growth in Revenue. The Revenue will grow by 10.27% on average per year.
EPS Next Y116.34%
EPS Next 2Y87.03%
EPS Next 3Y50.62%
EPS Next 5YN/A
Revenue Next Year22.42%
Revenue Next 2Y13.85%
Revenue Next 3Y10.27%
Revenue Next 5YN/A
3.3 Evolution
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 66.26, ARE can be considered very expensive at the moment.
Based on the Price/Earnings ratio, ARE is valued a bit more expensive than the industry average as 71.43% of the companies are valued more cheaply.
ARE's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 26.91.
A Price/Forward Earnings ratio of 18.47 indicates a rather expensive valuation of ARE.
Based on the Price/Forward Earnings ratio, ARE is valued cheaper than 85.71% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ARE to the average of the S&P500 Index (22.92), we can say ARE is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 66.26 | ||
| Fwd PE | 18.47 |
4.2 Price Multiples
71.43% of the companies in the same industry are more expensive than ARE, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 14.78 |
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.
ARE's earnings are expected to grow with 50.62% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.57
PEG (5Y)N/A
EPS Next 2Y87.03%
EPS Next 3Y50.62%
5. Dividend
5.1 Amount
ARE has a Yearly Dividend Yield of 3.11%. Purely for dividend investing, there may be better candidates out there.
ARE's Dividend Yield is rather good when compared to the industry average which is at 1.37. ARE pays more dividend than 100.00% of the companies in the same industry.
ARE's Dividend Yield is a higher than the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.11% |
5.2 History
On average, the dividend of ARE grows each year by 6.05%, which is quite nice.
ARE has been paying a dividend for at least 10 years, so it has a reliable track record.
ARE has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.05%
Div Incr Years1
Div Non Decr Years17
5.3 Sustainability
ARE pays out 190.98% of its income as dividend. This is not a sustainable payout ratio.
The dividend of ARE is growing, but earnings are growing more, so the dividend growth is sustainable.
DP190.98%
EPS Next 2Y87.03%
EPS Next 3Y50.62%
TSX:ARE (10/24/2025, 7:00:00 PM)
28.49
+3.83 (+15.53%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners18.27%
Inst Owner ChangeN/A
Ins Owners0.9%
Ins Owner ChangeN/A
Market Cap1.82B
Revenue(TTM)4.91B
Net Income(TTM)24.93M
Analysts77.33
Price Target24.02 (-15.69%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.11% |
Yearly Dividend0.75
Dividend Growth(5Y)6.05%
DP190.98%
Div Incr Years1
Div Non Decr Years17
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-249.62%
Min EPS beat(2)-260.38%
Max EPS beat(2)-238.86%
EPS beat(4)1
Avg EPS beat(4)-135.33%
Min EPS beat(4)-260.38%
Max EPS beat(4)7.76%
EPS beat(8)4
Avg EPS beat(8)-33.33%
EPS beat(12)8
Avg EPS beat(12)2.44%
EPS beat(16)10
Avg EPS beat(16)-10.95%
Revenue beat(2)2
Avg Revenue beat(2)16.07%
Min Revenue beat(2)14.68%
Max Revenue beat(2)17.47%
Revenue beat(4)4
Avg Revenue beat(4)9.72%
Min Revenue beat(4)1.22%
Max Revenue beat(4)17.47%
Revenue beat(8)4
Avg Revenue beat(8)-0.77%
Revenue beat(12)8
Avg Revenue beat(12)1.07%
Revenue beat(16)10
Avg Revenue beat(16)2.39%
PT rev (1m)1.17%
PT rev (3m)8.82%
EPS NQ rev (1m)-13.67%
EPS NQ rev (3m)-36.61%
EPS NY rev (1m)0%
EPS NY rev (3m)-84.83%
Revenue NQ rev (1m)0.43%
Revenue NQ rev (3m)0.72%
Revenue NY rev (1m)0%
Revenue NY rev (3m)4.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 66.26 | ||
| Fwd PE | 18.47 | ||
| P/S | 0.37 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 2.05 | ||
| P/tB | 2.74 | ||
| EV/EBITDA | 14.78 |
EPS(TTM)0.43
EY1.51%
EPS(NY)1.54
Fwd EY5.42%
FCF(TTM)-1.41
FCFYN/A
OCF(TTM)-0.49
OCFYN/A
SpS76.93
BVpS13.92
TBVpS10.38
PEG (NY)0.57
PEG (5Y)N/A
Graham Number11.61
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.72% | ||
| ROE | 2.81% | ||
| ROCE | 3.22% | ||
| ROIC | 2.32% | ||
| ROICexc | 2.53% | ||
| ROICexgc | 3.06% | ||
| OM | 0.94% | ||
| PM (TTM) | 0.51% | ||
| GM | 7.67% | ||
| FCFM | N/A |
ROA(3y)1.36%
ROA(5y)1.65%
ROE(3y)4.06%
ROE(5y)5.54%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-22.44%
GM growth 5Y-16.54%
F-Score4
Asset Turnover1.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.22 | ||
| Cap/Depr | 58.64% | ||
| Cap/Sales | 1.21% | ||
| Interest Coverage | 1.6 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 2.15 |
F-Score4
WACC8.98%
ROIC/WACC0.26
Cap/Depr(3y)44.95%
Cap/Depr(5y)66.77%
Cap/Sales(3y)0.88%
Cap/Sales(5y)1.5%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)238.71%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%95.48%
EPS Next Y116.34%
EPS Next 2Y87.03%
EPS Next 3Y50.62%
EPS Next 5YN/A
Revenue 1Y (TTM)20.53%
Revenue growth 3Y2.18%
Revenue growth 5Y4.16%
Sales Q2Q%52.45%
Revenue Next Year22.42%
Revenue Next 2Y13.85%
Revenue Next 3Y10.27%
Revenue Next 5YN/A
EBIT growth 1Y124.8%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year618.02%
EBIT Next 3Y117.4%
EBIT Next 5YN/A
FCF growth 1Y64.24%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y85.23%
OCF growth 3YN/A
OCF growth 5Y-47.93%
AECON GROUP INC / ARE.CA FAQ
What is the fundamental rating for ARE stock?
ChartMill assigns a fundamental rating of 4 / 10 to ARE.CA.
Can you provide the valuation status for AECON GROUP INC?
ChartMill assigns a valuation rating of 4 / 10 to AECON GROUP INC (ARE.CA). This can be considered as Fairly Valued.
What is the profitability of ARE stock?
AECON GROUP INC (ARE.CA) has a profitability rating of 1 / 10.
Can you provide the PE and PB ratios for ARE stock?
The Price/Earnings (PE) ratio for AECON GROUP INC (ARE.CA) is 66.26 and the Price/Book (PB) ratio is 2.05.
Can you provide the financial health for ARE stock?
The financial health rating of AECON GROUP INC (ARE.CA) is 3 / 10.