CAE INC (CAE.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:CAE - CA1247651088 - Common Stock
44.34 CAD
-0.96 (-2.12%)
We assign a fundamental rating of 4 out of 10 to CAE. CAE was compared to 13 industry peers in the Aerospace & Defense industry. CAE has an average financial health and profitability rating. CAE is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year CAE was profitable.
- In the past year CAE had a positive cash flow from operations.
- In multiple years CAE reported negative net income over the last 5 years.
- CAE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- CAE has a better Return On Assets (3.87%) than 84.62% of its industry peers.
- CAE has a Return On Equity of 8.45%. This is amongst the best in the industry. CAE outperforms 84.62% of its industry peers.
- With a Return On Invested Capital value of 5.96%, CAE perfoms like the industry average, outperforming 46.15% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for CAE is below the industry average of 8.00%.
- The 3 year average ROIC (5.18%) for CAE is below the current ROIC(5.96%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.87% | ||
| ROE | 8.45% | ||
| ROIC | 5.96% |
ROA(3y)0.89%
ROA(5y)0.72%
ROE(3y)2.01%
ROE(5y)1.61%
ROIC(3y)5.18%
ROIC(5y)4.62%
1.3 Margins
- CAE's Profit Margin of 8.88% is amongst the best of the industry. CAE outperforms 92.31% of its industry peers.
- In the last couple of years the Profit Margin of CAE has remained more or less at the same level.
- Looking at the Operating Margin, with a value of 13.19%, CAE belongs to the top of the industry, outperforming 92.31% of the companies in the same industry.
- CAE's Operating Margin has declined in the last couple of years.
- With a decent Gross Margin value of 28.22%, CAE is doing good in the industry, outperforming 76.92% of the companies in the same industry.
- CAE's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.19% | ||
| PM (TTM) | 8.88% | ||
| GM | 28.22% |
OM growth 3Y4.74%
OM growth 5Y-1.9%
PM growth 3Y27%
PM growth 5Y0.03%
GM growth 3Y-0.86%
GM growth 5Y-1.58%
2. Health
2.1 Basic Checks
- CAE has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, CAE has more shares outstanding
- The number of shares outstanding for CAE has been increased compared to 5 years ago.
- CAE has a better debt/assets ratio than last year.
2.2 Solvency
- CAE has an Altman-Z score of 2.32. This is not the best score and indicates that CAE is in the grey zone with still only limited risk for bankruptcy at the moment.
- The Altman-Z score of CAE (2.32) is better than 92.31% of its industry peers.
- CAE has a debt to FCF ratio of 7.20. This is a slightly negative value and a sign of low solvency as CAE would need 7.20 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 7.20, CAE is in the better half of the industry, outperforming 76.92% of the companies in the same industry.
- CAE has a Debt/Equity ratio of 0.61. This is a neutral value indicating CAE is somewhat dependend on debt financing.
- With a decent Debt to Equity ratio value of 0.61, CAE is doing good in the industry, outperforming 61.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.61 | ||
| Debt/FCF | 7.2 | ||
| Altman-Z | 2.32 |
ROIC/WACC0.64
WACC9.34%
2.3 Liquidity
- A Current Ratio of 0.83 indicates that CAE may have some problems paying its short term obligations.
- CAE has a Current ratio of 0.83. This is in the lower half of the industry: CAE underperforms 76.92% of its industry peers.
- A Quick Ratio of 0.59 indicates that CAE may have some problems paying its short term obligations.
- CAE has a better Quick ratio (0.59) than 61.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.83 | ||
| Quick Ratio | 0.59 |
3. Growth
3.1 Past
- CAE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.21%, which is quite good.
- Measured over the past years, CAE shows a decrease in Earnings Per Share. The EPS has been decreasing by -2.17% on average per year.
- Looking at the last year, CAE shows a quite strong growth in Revenue. The Revenue has grown by 9.12% in the last year.
- Measured over the past years, CAE shows a small growth in Revenue. The Revenue has been growing by 5.38% on average per year.
EPS 1Y (TTM)13.21%
EPS 3Y12.94%
EPS 5Y-2.17%
EPS Q2Q%-4.17%
Revenue 1Y (TTM)9.12%
Revenue growth 3Y11.77%
Revenue growth 5Y5.38%
Sales Q2Q%8.8%
3.2 Future
- Based on estimates for the next years, CAE will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.25% on average per year.
- CAE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.95% yearly.
EPS Next Y1.92%
EPS Next 2Y11.93%
EPS Next 3Y14.29%
EPS Next 5Y15.25%
Revenue Next Year4.9%
Revenue Next 2Y5.14%
Revenue Next 3Y5.58%
Revenue Next 5Y5.95%
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 accelerating.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 36.95, the valuation of CAE can be described as expensive.
- Based on the Price/Earnings ratio, CAE is valued a bit more expensive than the industry average as 69.23% of the companies are valued more cheaply.
- CAE's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 28.39.
- CAE is valuated quite expensively with a Price/Forward Earnings ratio of 29.25.
- CAE's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. CAE is more expensive than 69.23% of the companies in the same industry.
- CAE is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 25.72, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.95 | ||
| Fwd PE | 29.25 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, CAE is valued a bit more expensive than 61.54% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of CAE is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.49 | ||
| EV/EBITDA | 16.4 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CAE does not grow enough to justify the current Price/Earnings ratio.
- The decent profitability rating of CAE may justify a higher PE ratio.
- A more expensive valuation may be justified as CAE's earnings are expected to grow with 14.29% in the coming years.
PEG (NY)19.26
PEG (5Y)N/A
EPS Next 2Y11.93%
EPS Next 3Y14.29%
5. Dividend
5.1 Amount
- No dividends for CAE!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
CAE INC / CAE.CA FAQ
What is the fundamental rating for CAE stock?
ChartMill assigns a fundamental rating of 4 / 10 to CAE.CA.
What is the valuation status for CAE stock?
ChartMill assigns a valuation rating of 2 / 10 to CAE INC (CAE.CA). This can be considered as Overvalued.
How profitable is CAE INC (CAE.CA) stock?
CAE INC (CAE.CA) has a profitability rating of 6 / 10.
What is the expected EPS growth for CAE INC (CAE.CA) stock?
The Earnings per Share (EPS) of CAE INC (CAE.CA) is expected to grow by 1.92% in the next year.
Is the dividend of CAE INC sustainable?
The dividend rating of CAE INC (CAE.CA) is 0 / 10 and the dividend payout ratio is 0%.