AECON GROUP INC (ARE.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:ARE - CA00762V1094 - Common Stock
31.28 CAD
+0.07 (+0.22%)
ARE gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 7 industry peers in the Construction & Engineering industry. ARE may be in some trouble as it scores bad on both profitability and health. ARE shows excellent growth, but is valued quite expensive already. Finally ARE also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year ARE was profitable.
ARE had a negative operating cash flow in the past year.
ARE had positive earnings in 4 of the past 5 years.
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 0.23%, ARE is not doing good in the industry: 85.71% of the companies in the same industry are doing better.
ARE has a Return On Equity of 0.92%. This is amonst the worse of the industry: ARE underperforms 85.71% of its industry peers.
The Return On Invested Capital of ARE (1.63%) is worse than 85.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.23% | ||
| ROE | 0.92% | ||
| ROIC | 1.63% |
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 0.16%. This is in the lower half of the industry: ARE underperforms 71.43% of its industry peers.
ARE has a Operating Margin of 0.62%. This is in the lower half of the industry: ARE underperforms 71.43% of its industry peers.
ARE has a Gross Margin of 6.92%. This is in the lower half of the industry: ARE underperforms 71.43% of its industry peers.
In the last couple of years the Gross Margin of ARE has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 0.62% | ||
| PM (TTM) | 0.16% | ||
| GM | 6.92% |
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.
The number of shares outstanding for ARE has been increased compared to 1 year ago.
The number of shares outstanding for ARE has been increased compared to 5 years ago.
ARE has a worse debt/assets ratio than last year.
2.2 Solvency
ARE has an Altman-Z score of 2.09. This is not the best score and indicates that ARE is in the grey zone with still only limited risk for bankruptcy at the moment.
ARE has a worse Altman-Z score (2.09) than 85.71% of its industry peers.
ARE has a Debt/Equity ratio of 0.43. This is a healthy value indicating a solid balance between debt and equity.
ARE's Debt to Equity ratio of 0.43 is fine compared to the rest of the industry. ARE outperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.09 |
ROIC/WACC0.17
WACC9.38%
2.3 Liquidity
A Current Ratio of 1.15 indicates that ARE should not have too much problems paying its short term obligations.
ARE's Current ratio of 1.15 is in line compared to the rest of the industry. ARE outperforms 57.14% of its industry peers.
ARE has a Quick Ratio of 1.14. This is a normal value and indicates that ARE is financially healthy and should not expect problems in meeting its short term obligations.
ARE's Quick ratio of 1.14 is in line compared to the rest of the industry. ARE outperforms 57.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.15 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 110.09% over the past year.
The Revenue has grown by 25.68% 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)110.09%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-37.65%
Revenue 1Y (TTM)25.68%
Revenue growth 3Y2.18%
Revenue growth 5Y4.16%
Sales Q2Q%19.98%
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 44.72% on average per year.
The Revenue is expected to grow by 20.16% on average over the next years. This is a very strong growth
EPS Next Y121.25%
EPS Next 2Y89.11%
EPS Next 3Y58.17%
EPS Next 5Y44.72%
Revenue Next Year26.6%
Revenue Next 2Y15.48%
Revenue Next 3Y12.96%
Revenue Next 5Y20.16%
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
A Price/Earnings ratio of 284.36 indicates a quite expensive valuation of ARE.
85.71% of the companies in the same industry are cheaper than ARE, based on the Price/Earnings ratio.
ARE is valuated expensively when we compare the Price/Earnings ratio to 26.51, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 19.27, ARE is valued on the expensive side.
Based on the Price/Forward Earnings ratio, ARE is valued cheaply inside the industry as 85.71% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 23.13. ARE is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 284.36 | ||
| Fwd PE | 19.27 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ARE indicates a slightly more expensive valuation: ARE is more expensive than 71.43% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 19.2 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ARE does not grow enough to justify the current Price/Earnings ratio.
A more expensive valuation may be justified as ARE's earnings are expected to grow with 58.17% in the coming years.
PEG (NY)2.35
PEG (5Y)N/A
EPS Next 2Y89.11%
EPS Next 3Y58.17%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.40%, ARE has a reasonable but not impressive dividend return.
ARE's Dividend Yield is rather good when compared to the industry average which is at 1.09. ARE pays more dividend than 85.71% of the companies in the same industry.
ARE's Dividend Yield is a higher than the S&P500 average which is at 2.00.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
5.2 History
The dividend of ARE is nicely growing with an annual growth rate of 6.05%!
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 563.75% 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.
DP563.75%
EPS Next 2Y89.11%
EPS Next 3Y58.17%
TSX:ARE (12/31/2025, 7:00:00 PM)
31.28
+0.07 (+0.22%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners18.3%
Inst Owner ChangeN/A
Ins Owners0.91%
Ins Owner ChangeN/A
Market Cap1.98B
Revenue(TTM)5.16B
Net Income(TTM)8.47M
Analysts69.33
Price Target34.22 (9.4%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.4% |
Yearly Dividend0.75
Dividend Growth(5Y)6.05%
DP563.75%
Div Incr Years1
Div Non Decr Years17
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-113.16%
Min EPS beat(2)-260.38%
Max EPS beat(2)34.06%
EPS beat(4)1
Avg EPS beat(4)-128.75%
Min EPS beat(4)-260.38%
Max EPS beat(4)34.06%
EPS beat(8)4
Avg EPS beat(8)-60.01%
EPS beat(12)8
Avg EPS beat(12)4.98%
EPS beat(16)10
Avg EPS beat(16)-8.98%
Revenue beat(2)2
Avg Revenue beat(2)13.23%
Min Revenue beat(2)8.99%
Max Revenue beat(2)17.47%
Revenue beat(4)4
Avg Revenue beat(4)11.66%
Min Revenue beat(4)5.5%
Max Revenue beat(4)17.47%
Revenue beat(8)5
Avg Revenue beat(8)0.92%
Revenue beat(12)8
Avg Revenue beat(12)1.42%
Revenue beat(16)11
Avg Revenue beat(16)3.14%
PT rev (1m)0.27%
PT rev (3m)44.14%
EPS NQ rev (1m)3.38%
EPS NQ rev (3m)20%
EPS NY rev (1m)3.18%
EPS NY rev (3m)30%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)4.48%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)3.41%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 284.36 | ||
| Fwd PE | 19.27 | ||
| P/S | 0.38 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 2.16 | ||
| P/tB | 3.04 | ||
| EV/EBITDA | 19.2 |
EPS(TTM)0.11
EY0.35%
EPS(NY)1.62
Fwd EY5.19%
FCF(TTM)-1.42
FCFYN/A
OCF(TTM)-0.53
OCFYN/A
SpS81.54
BVpS14.47
TBVpS10.3
PEG (NY)2.35
PEG (5Y)N/A
Graham Number5.99
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.23% | ||
| ROE | 0.92% | ||
| ROCE | 2.26% | ||
| ROIC | 1.63% | ||
| ROICexc | 1.65% | ||
| ROICexgc | 2.05% | ||
| OM | 0.62% | ||
| PM (TTM) | 0.16% | ||
| GM | 6.92% | ||
| 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-Score5
Asset Turnover1.38
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 2.97 | ||
| Cap/Depr | 54.82% | ||
| Cap/Sales | 1.09% | ||
| Interest Coverage | 0.95 | ||
| Cash Conversion | N/A | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.15 | ||
| Quick Ratio | 1.14 | ||
| Altman-Z | 2.09 |
F-Score5
WACC9.38%
ROIC/WACC0.17
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)110.09%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-37.65%
EPS Next Y121.25%
EPS Next 2Y89.11%
EPS Next 3Y58.17%
EPS Next 5Y44.72%
Revenue 1Y (TTM)25.68%
Revenue growth 3Y2.18%
Revenue growth 5Y4.16%
Sales Q2Q%19.98%
Revenue Next Year26.6%
Revenue Next 2Y15.48%
Revenue Next 3Y12.96%
Revenue Next 5Y20.16%
EBIT growth 1Y128.65%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year607.52%
EBIT Next 3Y121.36%
EBIT Next 5YN/A
FCF growth 1Y25.7%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y61.53%
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 3 / 10 to ARE.CA.
What is the valuation status of AECON GROUP INC (ARE.CA) stock?
ChartMill assigns a valuation rating of 2 / 10 to AECON GROUP INC (ARE.CA). This can be considered as Overvalued.
Can you provide the profitability details for AECON GROUP INC?
AECON GROUP INC (ARE.CA) has a profitability rating of 1 / 10.
What is the valuation of AECON GROUP INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for AECON GROUP INC (ARE.CA) is 284.36 and the Price/Book (PB) ratio is 2.16.
What is the financial health of AECON GROUP INC (ARE.CA) stock?
The financial health rating of AECON GROUP INC (ARE.CA) is 3 / 10.