AECON GROUP INC (ARE.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:ARE - CA00762V1094 - Common Stock
32.46 CAD
+0.59 (+1.85%)
ARE gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 8 industry peers in the Construction & Engineering industry. ARE has a bad profitability rating. Also its financial health evaluation is rather negative. ARE is quite expensive at the moment. It does show a decent growth rate. Finally 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.
ARE had positive earnings in 4 of the past 5 years.
In multiple years ARE reported negative operating cash flow during the last 5 years.
1.2 Ratios
With a Return On Assets value of 0.23%, ARE is not doing good in the industry: 75.00% of the companies in the same industry are doing better.
ARE has a Return On Equity of 0.92%. This is in the lower half of the industry: ARE underperforms 75.00% of its industry peers.
With a Return On Invested Capital value of 1.63%, ARE is not doing good in the industry: 75.00% of the companies in the same industry are doing better.
| 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
The Profit Margin of ARE (0.16%) is worse than 62.50% of its industry peers.
ARE has a worse Operating Margin (0.62%) than 62.50% of its industry peers.
ARE has a Gross Margin of 6.92%. This is in the lower half of the industry: ARE underperforms 62.50% 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.
Compared to 1 year ago, ARE has more shares outstanding
ARE has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, ARE has a worse debt to assets ratio.
2.2 Solvency
ARE has an Altman-Z score of 2.11. 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.
The Altman-Z score of ARE (2.11) is worse than 75.00% 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.
The Debt to Equity ratio of ARE (0.43) is better than 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.43 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.11 |
ROIC/WACC0.18
WACC9.04%
2.3 Liquidity
A Current Ratio of 1.15 indicates that ARE should not have too much problems paying its short term obligations.
The Current ratio of ARE (1.15) is better than 62.50% 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 has a Quick ratio of 1.14. This is in the better half of the industry: ARE outperforms 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.15 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
ARE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 110.09%, which is quite impressive.
ARE shows a strong growth in Revenue. In the last year, the Revenue has grown by 25.68%.
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 44.25% 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 19.59% on average per year.
EPS Next Y121.25%
EPS Next 2Y89.11%
EPS Next 3Y58.17%
EPS Next 5Y44.25%
Revenue Next Year26.6%
Revenue Next 2Y15.48%
Revenue Next 3Y12.96%
Revenue Next 5Y19.59%
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
ARE is valuated quite expensively with a Price/Earnings ratio of 295.09.
Compared to the rest of the industry, the Price/Earnings ratio of ARE indicates a slightly more expensive valuation: ARE is more expensive than 75.00% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of ARE to the average of the S&P500 Index (27.25), we can say ARE is valued expensively.
A Price/Forward Earnings ratio of 19.99 indicates a rather expensive valuation of ARE.
Based on the Price/Forward Earnings ratio, ARE is valued cheaper than 87.50% of the companies in the same industry.
ARE is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 295.09 | ||
| Fwd PE | 19.99 |
4.2 Price Multiples
62.50% of the companies in the same industry are cheaper than ARE, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 19.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
A more expensive valuation may be justified as ARE's earnings are expected to grow with 58.17% in the coming years.
PEG (NY)2.43
PEG (5Y)N/A
EPS Next 2Y89.11%
EPS Next 3Y58.17%
5. Dividend
5.1 Amount
ARE has a Yearly Dividend Yield of 2.45%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.09, ARE pays a better dividend. On top of this ARE pays more dividend than 87.50% of the companies listed in the same industry.
ARE's Dividend Yield is a higher than the S&P500 average which is at 1.92.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.45% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.05%
Div Incr Years1
Div Non Decr Years17
5.3 Sustainability
563.75% of the earnings are spent on dividend by ARE. 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 (1/12/2026, 7:00:00 PM)
32.46
+0.59 (+1.85%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners18.74%
Inst Owner ChangeN/A
Ins Owners1.18%
Ins Owner ChangeN/A
Market Cap2.05B
Revenue(TTM)5.16B
Net Income(TTM)8.47M
Analysts69.33
Price Target34.22 (5.42%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.45% |
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)42.47%
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 | 295.09 | ||
| Fwd PE | 19.99 | ||
| P/S | 0.4 | ||
| P/FCF | N/A | ||
| P/OCF | N/A | ||
| P/B | 2.24 | ||
| P/tB | 3.15 | ||
| EV/EBITDA | 19.76 |
EPS(TTM)0.11
EY0.34%
EPS(NY)1.62
Fwd EY5%
FCF(TTM)-1.42
FCFYN/A
OCF(TTM)-0.53
OCFYN/A
SpS81.54
BVpS14.47
TBVpS10.3
PEG (NY)2.43
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 | 2.11 |
F-Score5
WACC9.04%
ROIC/WACC0.18
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 5Y44.25%
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 5Y19.59%
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 295.09 and the Price/Book (PB) ratio is 2.24.
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.