We assign a fundamental rating of 4 out of 10 to CECO. CECO was compared to 132 industry peers in the Machinery industry. CECO has a medium profitability rating, but doesn't score so well on its financial health evaluation. CECO is valued quite expensive, but it does show an excellent growth.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year CECO was profitable.
CECO had a negative operating cash flow in the past year.
Each year in the past 5 years CECO has been profitable.
In the past 5 years CECO always reported a positive cash flow from operatings.

1.2 Ratios

CECO's Return On Assets of 5.82% is fine compared to the rest of the industry. CECO outperforms 65.15% of its industry peers.
CECO has a Return On Equity of 16.78%. This is in the better half of the industry: CECO outperforms 78.03% of its industry peers.
CECO has a Return On Invested Capital (5.78%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CECO is below the industry average of 10.37%.

		Industry Rank	Sector Rank
ROA	5.82%
ROE	16.78%
ROIC	5.78%

ROA(3y)2.43%

ROA(5y)1.92%

ROE(3y)6.31%

ROE(5y)4.73%

ROIC(3y)6.39%

ROIC(5y)5.34%

1.3 Margins

With a decent Profit Margin value of 7.22%, CECO is doing good in the industry, outperforming 62.88% of the companies in the same industry.
CECO's Profit Margin has declined in the last couple of years.
CECO has a Operating Margin (6.42%) which is comparable to the rest of the industry.
In the last couple of years the Operating Margin of CECO has grown nicely.
With a decent Gross Margin value of 34.91%, CECO is doing good in the industry, outperforming 62.88% of the companies in the same industry.
CECO's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	6.42%
PM (TTM)	7.22%
GM	34.91%

OM growth 3Y24.13%

OM growth 5Y5.02%

PM growth 3Y75.18%

PM growth 5Y-14.81%

GM growth 3Y4.29%

GM growth 5Y1.11%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), CECO is destroying value.
Compared to 1 year ago, CECO has more shares outstanding
CECO has less shares outstanding than it did 5 years ago.
The debt/assets ratio for CECO is higher compared to a year ago.

2.2 Solvency

An Altman-Z score of 3.67 indicates that CECO is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 3.67, CECO is doing good in the industry, outperforming 62.88% of the companies in the same industry.
A Debt/Equity ratio of 0.71 indicates that CECO is somewhat dependend on debt financing.
CECO has a worse Debt to Equity ratio (0.71) than 68.94% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.71
Debt/FCF	N/A
Altman-Z	3.67

ROIC/WACC0.6

WACC9.67%

2.3 Liquidity

A Current Ratio of 1.33 indicates that CECO should not have too much problems paying its short term obligations.
The Current ratio of CECO (1.33) is worse than 81.82% of its industry peers.
A Quick Ratio of 0.76 indicates that CECO may have some problems paying its short term obligations.
CECO has a Quick ratio of 0.76. This is amonst the worse of the industry: CECO underperforms 80.30% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.33
Quick Ratio	0.76

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

CECO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 19.18%, which is quite good.
Measured over the past 5 years, CECO shows a small growth in Earnings Per Share. The EPS has been growing by 4.06% on average per year.
The Revenue has grown by 29.86% in the past year. This is a very strong growth!
Measured over the past years, CECO shows a quite strong growth in Revenue. The Revenue has been growing by 10.29% on average per year.

EPS 1Y (TTM)19.18%

EPS 3Y35.41%

EPS 5Y4.06%

EPS Q2Q%85.71%

Revenue 1Y (TTM)29.86%

Revenue growth 3Y19.85%

Revenue growth 5Y10.29%

Sales Q2Q%45.82%

3.2 Future

CECO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 42.16% yearly.
The Revenue is expected to grow by 20.13% on average over the next years. This is a very strong growth

EPS Next Y39.51%

EPS Next 2Y43.92%

EPS Next 3Y42.16%

EPS Next 5YN/A

Revenue Next Year36.55%

Revenue Next 2Y25.1%

Revenue Next 3Y20.13%

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 accelerating.
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.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 78.30, CECO can be considered very expensive at the moment.
CECO's Price/Earnings ratio is a bit more expensive when compared to the industry. CECO is more expensive than 68.94% of the companies in the same industry.
When comparing the Price/Earnings ratio of CECO to the average of the S&P500 Index (28.41), we can say CECO is valued expensively.
Based on the Price/Forward Earnings ratio of 45.68, the valuation of CECO can be described as expensive.
Based on the Price/Forward Earnings ratio, CECO is valued a bit more expensive than the industry average as 68.94% of the companies are valued more cheaply.
CECO's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 25.64.

		Industry Rank	Sector Rank
PE	78.3
Fwd PE	45.68

4.2 Price Multiples

CECO's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. CECO is more expensive than 74.24% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	37.92

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CECO does not grow enough to justify the current Price/Earnings ratio.
A more expensive valuation may be justified as CECO's earnings are expected to grow with 42.16% in the coming years.