STANTEC INC (STN.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:STN - CA85472N1096 - Common Stock
137.26 CAD
-0.3 (-0.22%)
STN gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 8 industry peers in the Construction & Engineering industry. STN has an excellent profitability rating, but there are some minor concerns on its financial health. STN is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings could make STN a good candidate for growth 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.
- Each year in the past 5 years STN has been profitable.
- In the past 5 years STN always reported a positive cash flow from operatings.
1.2 Ratios
- STN has a better Return On Assets (5.95%) than 62.50% of its industry peers.
- STN's Return On Equity of 14.97% is in line compared to the rest of the industry. STN outperforms 50.00% of its industry peers.
- With a decent Return On Invested Capital value of 9.44%, STN is doing good in the industry, outperforming 62.50% of the companies in the same industry.
- STN had an Average Return On Invested Capital over the past 3 years of 8.26%. This is significantly below the industry average of 71.07%.
- The 3 year average ROIC (8.26%) for STN is below the current ROIC(9.44%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.95% | ||
| ROE | 14.97% | ||
| ROIC | 9.44% |
ROA(3y)5.02%
ROA(5y)4.56%
ROE(3y)12%
ROE(5y)10.98%
ROIC(3y)8.26%
ROIC(5y)7.69%
1.3 Margins
- STN has a better Profit Margin (7.63%) than 75.00% of its industry peers.
- STN's Profit Margin has improved in the last couple of years.
- STN has a Operating Margin of 11.23%. This is amongst the best in the industry. STN outperforms 100.00% of its industry peers.
- STN's Operating Margin has improved in the last couple of years.
- STN has a Gross Margin of 54.46%. This is amongst the best in the industry. STN outperforms 87.50% of its industry peers.
- STN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.23% | ||
| PM (TTM) | 7.63% | ||
| GM | 54.46% |
OM growth 3Y4.91%
OM growth 5Y1.76%
PM growth 3Y3.74%
PM growth 5Y3.3%
GM growth 3Y0.35%
GM growth 5Y0.13%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so STN is destroying value.
- STN has about the same amout of shares outstanding than it did 1 year ago.
- STN has more shares outstanding than it did 5 years ago.
- The debt/assets ratio for STN has been reduced compared to a year ago.
2.2 Solvency
- An Altman-Z score of 3.37 indicates that STN is not in any danger for bankruptcy at the moment.
- STN's Altman-Z score of 3.37 is fine compared to the rest of the industry. STN outperforms 62.50% of its industry peers.
- STN has a debt to FCF ratio of 3.36. This is a good value and a sign of high solvency as STN would need 3.36 years to pay back of all of its debts.
- STN has a better Debt to FCF ratio (3.36) than 87.50% of its industry peers.
- STN has a Debt/Equity ratio of 0.72. This is a neutral value indicating STN is somewhat dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.72, STN is doing worse than 62.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.72 | ||
| Debt/FCF | 3.36 | ||
| Altman-Z | 3.37 |
ROIC/WACC0.99
WACC9.56%
2.3 Liquidity
- STN has a Current Ratio of 1.27. 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 (1.27) is better than 75.00% of its industry peers.
- STN has a Quick Ratio of 1.27. This is a normal value and indicates that STN is financially healthy and should not expect problems in meeting its short term obligations.
- STN's Quick ratio of 1.27 is amongst the best of the industry. STN outperforms 87.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.27 | ||
| Quick Ratio | 1.27 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 24.64% over the past year.
- STN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.12% yearly.
- STN shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.49%.
- The Revenue has been growing by 9.59% on average over the past years. This is quite good.
EPS 1Y (TTM)24.64%
EPS 3Y22.5%
EPS 5Y17.12%
EPS Q2Q%17.69%
Revenue 1Y (TTM)12.49%
Revenue growth 3Y17.29%
Revenue growth 5Y9.59%
Sales Q2Q%11.84%
3.2 Future
- The Earnings Per Share is expected to grow by 15.33% on average over the next years. This is quite good.
- Based on estimates for the next years, STN will show a quite strong growth in Revenue. The Revenue will grow by 9.23% on average per year.
EPS Next Y20.33%
EPS Next 2Y17.31%
EPS Next 3Y15.33%
EPS Next 5YN/A
Revenue Next Year12%
Revenue Next 2Y11%
Revenue Next 3Y9.23%
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 stable.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 26.60, the valuation of STN can be described as expensive.
- STN's Price/Earnings ratio is a bit cheaper when compared to the industry. STN is cheaper than 75.00% of the companies in the same industry.
- STN is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.87, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 22.51, the valuation of STN can be described as rather expensive.
- Based on the Price/Forward Earnings ratio, STN is valued a bit cheaper than 62.50% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.96, STN is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.6 | ||
| Fwd PE | 22.51 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of STN indicates a somewhat cheap valuation: STN is cheaper than 62.50% of the companies listed in the same industry.
- STN's Price/Free Cash Flow ratio is rather cheap when compared to the industry. STN is cheaper than 87.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.45 | ||
| EV/EBITDA | 17.4 |
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 a very decent profitability rating, which may justify a higher PE ratio.
- STN's earnings are expected to grow with 15.33% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.31
PEG (5Y)1.55
EPS Next 2Y17.31%
EPS Next 3Y15.33%
5. Dividend
5.1 Amount
- STN has a yearly dividend return of 0.64%, which is pretty low.
- STN's Dividend Yield is a higher than the industry average which is at 0.90.
- Compared to an average S&P500 Dividend Yield of 1.82, STN's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
- The dividend of STN is nicely growing with an annual growth rate of 7.51%!
- STN has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)7.51%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- STN pays out 20.52% 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.
DP20.52%
EPS Next 2Y17.31%
EPS Next 3Y15.33%
STANTEC INC / STN.CA FAQ
Can you provide the ChartMill fundamental rating for STANTEC INC?
ChartMill assigns a fundamental rating of 6 / 10 to STN.CA.
Can you provide the valuation status for STANTEC INC?
ChartMill assigns a valuation rating of 5 / 10 to STANTEC INC (STN.CA). This can be considered as Fairly Valued.
Can you provide the profitability details for STANTEC INC?
STANTEC INC (STN.CA) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for STN stock?
The Price/Earnings (PE) ratio for STANTEC INC (STN.CA) is 26.6 and the Price/Book (PB) ratio is 4.85.
How financially healthy is STANTEC INC?
The financial health rating of STANTEC INC (STN.CA) is 6 / 10.