STANTEC INC (STN.CA) Stock Fundamental Analysis
TSX:STN - Toronto Stock Exchange - CA85472N1096 - Common Stock - Currency: CAD
STN gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 7 industry peers in the Construction & Engineering industry. STN scores excellent points on both the profitability and health parts. This is a solid base for a good stock. STN is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings would make STN suitable for growth and quality investing!
1. Profitability
1.1 Basic Checks
STN had positive earnings in the past year.
In the past year STN had a positive cash flow from operations.
In the past 5 years STN has always been profitable.
STN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
STN's Return On Assets of 5.88% is amongst the best of the industry. STN outperforms 85.71% of its industry peers.
STN's Return On Equity of 14.11% is fine compared to the rest of the industry. STN outperforms 71.43% of its industry peers.
STN's Return On Invested Capital of 9.42% is fine compared to the rest of the industry. STN outperforms 71.43% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for STN is below the industry average of 9.72%.
The 3 year average ROIC (7.08%) for STN is below the current ROIC(9.42%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.88% | ||
| ROE | 14.11% | ||
| ROIC | 9.42% |
ROA(3y)4.55%
ROA(5y)4.36%
ROE(3y)10.95%
ROE(5y)10.42%
ROIC(3y)7.08%
ROIC(5y)7.21%
1.3 Margins
Looking at the Profit Margin, with a value of 6.15%, STN belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
STN's Profit Margin has improved in the last couple of years.
STN has a better Operating Margin (9.73%) than 85.71% of its industry peers.
In the last couple of years the Operating Margin of STN has grown nicely.
STN has a Gross Margin of 54.29%. This is amongst the best in the industry. STN outperforms 85.71% of its industry peers.
In the last couple of years the Gross Margin of STN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.73% | ||
| PM (TTM) | 6.15% | ||
| GM | 54.29% |
OM growth 3Y2.12%
OM growth 5Y4.84%
PM growth 3Y12.08%
PM growth 5Y35.85%
GM growth 3Y1.12%
GM growth 5Y0.03%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), STN is creating some value.
The number of shares outstanding for STN has been increased compared to 1 year ago.
The number of shares outstanding for STN has been increased compared to 5 years ago.
Compared to 1 year ago, STN has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.46 indicates that STN is not in any danger for bankruptcy at the moment.
STN has a better Altman-Z score (3.46) than 100.00% of its industry peers.
The Debt to FCF ratio of STN is 4.85, which is a neutral value as it means it would take STN, 4.85 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of STN (4.85) is better than 85.71% of its industry peers.
STN has a Debt/Equity ratio of 0.71. This is a neutral value indicating STN is somewhat dependend on debt financing.
STN has a Debt to Equity ratio (0.71) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 4.85 | ||
| Altman-Z | 3.46 |
ROIC/WACC1.08
WACC8.71%
2.3 Liquidity
STN has a Current Ratio of 1.39. This is a normal value and indicates that STN is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of STN (1.39) is better than 85.71% of its industry peers.
A Quick Ratio of 1.39 indicates that STN should not have too much problems paying its short term obligations.
STN's Quick ratio of 1.39 is amongst the best of the industry. STN outperforms 85.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.39 | ||
| Quick Ratio | 1.39 |
3. Growth
3.1 Past
STN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.50%, which is quite good.
STN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.12% yearly.
Looking at the last year, STN shows a very strong growth in Revenue. The Revenue has grown by 41.30%.
STN shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.59% yearly.
EPS 1Y (TTM)12.5%
EPS 3Y18.17%
EPS 5Y17.12%
EPS Q2Q%14.04%
Revenue 1Y (TTM)41.3%
Revenue growth 3Y11.2%
Revenue growth 5Y8.59%
Sales Q2Q%15.8%
3.2 Future
STN is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.74% yearly.
The Revenue is expected to grow by 10.10% on average over the next years. This is quite good.
EPS Next Y18.54%
EPS Next 2Y15.77%
EPS Next 3Y14.74%
EPS Next 5YN/A
Revenue Next Year15.18%
Revenue Next 2Y12.12%
Revenue Next 3Y10.1%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
The Price/Earnings ratio is 26.18, which means the current valuation is very expensive for STN.
Based on the Price/Earnings ratio, STN is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of STN to the average of the S&P500 Index (29.63), we can say STN is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 21.98, the valuation of STN can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of STN is on the same level as its industry peers.
STN is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.18 | ||
| Fwd PE | 21.98 |
4.2 Price Multiples
STN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. STN is cheaper than 71.43% of the companies in the same industry.
71.43% of the companies in the same industry are more expensive than STN, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.07 | ||
| EV/EBITDA | 15.11 |
4.3 Compensation for Growth
STN's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
STN has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as STN's earnings are expected to grow with 14.74% in the coming years.
PEG (NY)1.41
PEG (5Y)1.53
EPS Next 2Y15.77%
EPS Next 3Y14.74%
5. Dividend
5.1 Amount
STN has a yearly dividend return of 0.77%, which is pretty low.
Compared to an average industry Dividend Yield of 1.74, STN has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.27, STN's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.77% |
5.2 History
On average, the dividend of STN grows each year by 6.83%, which is quite nice.
STN has paid a dividend for at least 10 years, which is a reliable track record.
STN has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.83%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
STN pays out 21.39% of its income as dividend. This is a sustainable payout ratio.
The dividend of STN is growing, but earnings are growing more, so the dividend growth is sustainable.
DP21.39%
EPS Next 2Y15.77%
EPS Next 3Y14.74%
TSX:STN (2/21/2025, 7:00:00 PM)
108.4
-0.53 (-0.49%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners87.13%
Inst Owner ChangeN/A
Ins Owners0.18%
Ins Owner ChangeN/A
Market Cap12.37B
Analysts77.33
Price Target136.12 (25.57%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.77% |
Yearly Dividend0.76
Dividend Growth(5Y)6.83%
DP21.39%
Div Incr Years11
Div Non Decr Years11
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.37%
Min EPS beat(2)-0.77%
Max EPS beat(2)3.51%
EPS beat(4)2
Avg EPS beat(4)3.32%
Min EPS beat(4)-5.6%
Max EPS beat(4)16.12%
EPS beat(8)5
Avg EPS beat(8)3.86%
EPS beat(12)8
Avg EPS beat(12)3.45%
EPS beat(16)11
Avg EPS beat(16)5.75%
Revenue beat(2)0
Avg Revenue beat(2)-0.34%
Min Revenue beat(2)-0.43%
Max Revenue beat(2)-0.25%
Revenue beat(4)2
Avg Revenue beat(4)0.51%
Min Revenue beat(4)-0.43%
Max Revenue beat(4)2.55%
Revenue beat(8)6
Avg Revenue beat(8)1.54%
Revenue beat(12)8
Avg Revenue beat(12)0.66%
Revenue beat(16)8
Avg Revenue beat(16)-0.64%
PT rev (1m)0.69%
PT rev (3m)4.26%
EPS NQ rev (1m)-0.29%
EPS NQ rev (3m)-0.29%
EPS NY rev (1m)0.15%
EPS NY rev (3m)1.87%
Revenue NQ rev (1m)-0.06%
Revenue NQ rev (3m)-0.06%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-0.1%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.18 | ||
| Fwd PE | 21.98 | ||
| P/S | 1.82 | ||
| P/FCF | 25.07 | ||
| P/OCF | 20.13 | ||
| P/B | 4.17 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.11 |
EPS(TTM)4.14
EY3.82%
EPS(NY)4.93
Fwd EY4.55%
FCF(TTM)4.32
FCFY3.99%
OCF(TTM)5.38
OCFY4.97%
SpS59.55
BVpS25.97
TBVpS-3.81
PEG (NY)1.41
PEG (5Y)1.53
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.88% | ||
| ROE | 14.11% | ||
| ROCE | 12.35% | ||
| ROIC | 9.42% | ||
| ROICexc | 9.82% | ||
| ROICexgc | 28.71% | ||
| OM | 9.73% | ||
| PM (TTM) | 6.15% | ||
| GM | 54.29% | ||
| FCFM | 7.26% |
ROA(3y)4.55%
ROA(5y)4.36%
ROE(3y)10.95%
ROE(5y)10.42%
ROIC(3y)7.08%
ROIC(5y)7.21%
ROICexc(3y)7.5%
ROICexc(5y)7.7%
ROICexgc(3y)21.26%
ROICexgc(5y)20.36%
ROCE(3y)9.29%
ROCE(5y)9.45%
ROICexcg growth 3Y7.61%
ROICexcg growth 5Y7.2%
ROICexc growth 3Y3.37%
ROICexc growth 5Y6.55%
OM growth 3Y2.12%
OM growth 5Y4.84%
PM growth 3Y12.08%
PM growth 5Y35.85%
GM growth 3Y1.12%
GM growth 5Y0.03%
F-Score7
Asset Turnover0.96
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.71 | ||
| Debt/FCF | 4.85 | ||
| Debt/EBITDA | 2.19 | ||
| Cap/Depr | 40.48% | ||
| Cap/Sales | 1.78% | ||
| Interest Coverage | 7.47 | ||
| Cash Conversion | 64% | ||
| Profit Quality | 117.99% | ||
| Current Ratio | 1.39 | ||
| Quick Ratio | 1.39 | ||
| Altman-Z | 3.46 |
F-Score7
WACC8.71%
ROIC/WACC1.08
Cap/Depr(3y)26.76%
Cap/Depr(5y)N/A
Cap/Sales(3y)1.59%
Cap/Sales(5y)1.43%
Profit Quality(3y)134.85%
Profit Quality(5y)188.56%
High Growth Momentum
Growth
EPS 1Y (TTM)12.5%
EPS 3Y18.17%
EPS 5Y17.12%
EPS Q2Q%14.04%
EPS Next Y18.54%
EPS Next 2Y15.77%
EPS Next 3Y14.74%
EPS Next 5YN/A
Revenue 1Y (TTM)41.3%
Revenue growth 3Y11.2%
Revenue growth 5Y8.59%
Sales Q2Q%15.8%
Revenue Next Year15.18%
Revenue Next 2Y12.12%
Revenue Next 3Y10.1%
Revenue Next 5YN/A
EBIT growth 1Y42.02%
EBIT growth 3Y13.55%
EBIT growth 5Y13.85%
EBIT Next Year65.84%
EBIT Next 3Y25.69%
EBIT Next 5YN/A
FCF growth 1Y135.98%
FCF growth 3Y-8.12%
FCF growth 5Y56.17%
OCF growth 1Y132.04%
OCF growth 3Y-3.38%
OCF growth 5Y25.84%