Tricon Residential Inc (TCN.CA) Stock Fundamental Analysis
Canada - TSX:TCN - CA89612W1023 - Common Stock
15.34 CAD
-0.12 (-0.78%)
We assign a fundamental rating of 4 out of 10 to TCN. TCN was compared to 30 industry peers in the Real Estate Management & Development industry. While TCN is still in line with the averages on profitability rating, there are concerns on its financial health. TCN is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
TCN had positive earnings in the past year.
In the past year TCN had a positive cash flow from operations.
Each year in the past 5 years TCN has been profitable.
TCN had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
TCN has a Return On Assets of 0.86%. This is in the better half of the industry: TCN outperforms 70.59% of its industry peers.
With a decent Return On Equity value of 2.96%, TCN is doing good in the industry, outperforming 73.53% of the companies in the same industry.
The Return On Invested Capital of TCN (1.64%) is worse than 67.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.86% | ||
| ROE | 2.96% | ||
| ROIC | 1.64% |
ROA(3y)4.08%
ROA(5y)3.73%
ROE(3y)12.96%
ROE(5y)10.43%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
TCN's Profit Margin of 13.44% is amongst the best of the industry. TCN outperforms 85.29% of its industry peers.
In the last couple of years the Profit Margin of TCN has declined.
TCN has a better Operating Margin (29.82%) than 67.65% of its industry peers.
TCN's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 69.17%, TCN belongs to the top of the industry, outperforming 88.24% of the companies in the same industry.
TCN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.82% | ||
| PM (TTM) | 13.44% | ||
| GM | 69.17% |
OM growth 3Y-5.22%
OM growth 5YN/A
PM growth 3Y-21.94%
PM growth 5Y-54.81%
GM growth 3Y-0.28%
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TCN is destroying value.
The number of shares outstanding for TCN remains at a similar level compared to 1 year ago.
Compared to 5 years ago, TCN has more shares outstanding
The debt/assets ratio for TCN has been reduced compared to a year ago.
2.2 Solvency
TCN has an Altman-Z score of 0.49. This is a bad value and indicates that TCN is not financially healthy and even has some risk of bankruptcy.
TCN's Altman-Z score of 0.49 is on the low side compared to the rest of the industry. TCN is outperformed by 79.41% of its industry peers.
The Debt to FCF ratio of TCN is 65.95, which is on the high side as it means it would take TCN, 65.95 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 65.95, TCN is doing good in the industry, outperforming 64.71% of the companies in the same industry.
TCN has a Debt/Equity ratio of 1.48. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.48, TCN is not doing good in the industry: 61.76% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.48 | ||
| Debt/FCF | 65.95 | ||
| Altman-Z | 0.49 |
ROIC/WACC0.22
WACC7.57%
2.3 Liquidity
TCN has a Current Ratio of 0.49. This is a bad value and indicates that TCN is not financially healthy enough and could expect problems in meeting its short term obligations.
TCN has a worse Current ratio (0.49) than 61.76% of its industry peers.
TCN has a Quick Ratio of 0.49. This is a bad value and indicates that TCN is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.49, TCN is not doing good in the industry: 61.76% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.49 | ||
| Quick Ratio | 0.49 |
3. Growth
3.1 Past
TCN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -66.47%.
Measured over the past years, TCN shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -17.03% on average per year.
TCN shows a small growth in Revenue. In the last year, the Revenue has grown by 5.48%.
Measured over the past years, TCN shows a very strong growth in Revenue. The Revenue has been growing by 94.79% on average per year.
EPS 1Y (TTM)-66.47%
EPS 3Y4.46%
EPS 5Y-17.03%
EPS Q2Q%36.36%
Revenue 1Y (TTM)5.48%
Revenue growth 3Y28.44%
Revenue growth 5Y94.79%
Sales Q2Q%15.69%
3.2 Future
Based on estimates for the next years, TCN will show a very negative growth in Earnings Per Share. The EPS will decrease by -15.81% on average per year.
The Revenue is expected to grow by 8.50% on average over the next years. This is quite good.
EPS Next Y-48.61%
EPS Next 2Y-15.81%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year6.66%
Revenue Next 2Y8.5%
Revenue Next 3YN/A
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.67, the valuation of TCN can be described as rather expensive.
TCN's Price/Earnings ratio is a bit cheaper when compared to the industry. TCN is cheaper than 79.41% of the companies in the same industry.
TCN's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.30.
The Price/Forward Earnings ratio is 38.28, which means the current valuation is very expensive for TCN.
Based on the Price/Forward Earnings ratio, TCN is valued a bit cheaper than the industry average as 70.59% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.73, TCN is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.67 | ||
| Fwd PE | 38.28 |
4.2 Price Multiples
TCN's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of TCN indicates a somewhat cheap valuation: TCN is cheaper than 73.53% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.33 | ||
| EV/EBITDA | 33.91 |
4.3 Compensation for Growth
TCN's earnings are expected to decrease with -15.81% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-15.81%
EPS Next 3YN/A
5. Dividend
5.1 Amount
TCN has a Yearly Dividend Yield of 1.99%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.17, TCN pays a bit more dividend than its industry peers.
TCN's Dividend Yield is comparable with the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
5.2 History
The dividend of TCN is nicely growing with an annual growth rate of 19.89%!
TCN has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)19.89%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
TCN pays out 84.00% of its income as dividend. This is not a sustainable payout ratio.
TCN's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP84%
EPS Next 2Y-15.81%
EPS Next 3YN/A
TSX:TCN (5/2/2024, 7:00:00 PM)
15.34
-0.12 (-0.78%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryReal Estate Management & Development
Earnings (Last)
Earnings (Next)
Inst Owners36.51%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap4.55B
Analysts71.11
Price Target12.26 (-20.08%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
Yearly Dividend0.35
Dividend Growth(5Y)19.89%
DP84%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)172.28%
Min EPS beat(2)147.53%
Max EPS beat(2)197.03%
EPS beat(4)3
Avg EPS beat(4)110.4%
Min EPS beat(4)-0.99%
Max EPS beat(4)197.03%
EPS beat(8)7
Avg EPS beat(8)235.95%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)85.19%
Min Revenue beat(2)79.44%
Max Revenue beat(2)90.95%
Revenue beat(4)4
Avg Revenue beat(4)80.48%
Min Revenue beat(4)72.02%
Max Revenue beat(4)90.95%
Revenue beat(8)8
Avg Revenue beat(8)71.53%
Revenue beat(12)11
Avg Revenue beat(12)50.84%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-5.26%
PT rev (3m)4.25%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.67 | ||
| Fwd PE | 38.28 | ||
| P/S | 3.92 | ||
| P/FCF | 36.33 | ||
| P/OCF | 24.11 | ||
| P/B | 0.86 | ||
| P/tB | 0.87 | ||
| EV/EBITDA | 33.91 |
EPS(TTM)0.78
EY5.08%
EPS(NY)0.4
Fwd EY2.61%
FCF(TTM)0.42
FCFY2.75%
OCF(TTM)0.64
OCFY4.15%
SpS3.92
BVpS17.81
TBVpS17.65
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.86% | ||
| ROE | 2.96% | ||
| ROCE | 2% | ||
| ROIC | 1.64% | ||
| ROICexc | 1.67% | ||
| ROICexgc | 1.67% | ||
| OM | 29.82% | ||
| PM (TTM) | 13.44% | ||
| GM | 69.17% | ||
| FCFM | 10.78% |
ROA(3y)4.08%
ROA(5y)3.73%
ROE(3y)12.96%
ROE(5y)10.43%
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
ROICexcg growth 3Y-1.7%
ROICexcg growth 5YN/A
ROICexc growth 3Y-1.2%
ROICexc growth 5YN/A
OM growth 3Y-5.22%
OM growth 5YN/A
PM growth 3Y-21.94%
PM growth 5Y-54.81%
GM growth 3Y-0.28%
GM growth 5YN/A
F-Score5
Asset Turnover0.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.48 | ||
| Debt/FCF | 65.95 | ||
| Debt/EBITDA | 21.13 | ||
| Cap/Depr | 261.04% | ||
| Cap/Sales | 5.47% | ||
| Interest Coverage | 0.87 | ||
| Cash Conversion | 50.9% | ||
| Profit Quality | 80.17% | ||
| Current Ratio | 0.49 | ||
| Quick Ratio | 0.49 | ||
| Altman-Z | 0.49 |
F-Score5
WACC7.57%
ROIC/WACC0.22
Cap/Depr(3y)254.57%
Cap/Depr(5y)208.56%
Cap/Sales(3y)5.52%
Cap/Sales(5y)8.97%
Profit Quality(3y)42.83%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-66.47%
EPS 3Y4.46%
EPS 5Y-17.03%
EPS Q2Q%36.36%
EPS Next Y-48.61%
EPS Next 2Y-15.81%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)5.48%
Revenue growth 3Y28.44%
Revenue growth 5Y94.79%
Sales Q2Q%15.69%
Revenue Next Year6.66%
Revenue Next 2Y8.5%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y152.14%
EBIT growth 3Y21.74%
EBIT growth 5YN/A
EBIT Next Year27.82%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-60.91%
FCF growth 3Y-11.02%
FCF growth 5YN/A
OCF growth 1Y-48.93%
OCF growth 3Y-1.17%
OCF growth 5YN/A