TECSYS INC (TCS.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:TCS - CA8789501043 - Common Stock
27.45 CAD
+0.43 (+1.59%)
Overall TCS gets a fundamental rating of 6 out of 10. We evaluated TCS against 68 industry peers in the Software industry. TCS is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. TCS has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- TCS had positive earnings in the past year.
- In the past year TCS had a positive cash flow from operations.
- TCS had positive earnings in each of the past 5 years.
- TCS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With a decent Return On Assets value of 4.06%, TCS is doing good in the industry, outperforming 72.06% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 7.97%, TCS is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
- The Return On Invested Capital of TCS (8.91%) is better than 75.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.06% | ||
| ROE | 7.97% | ||
| ROIC | 8.91% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- TCS's Profit Margin of 2.91% is fine compared to the rest of the industry. TCS outperforms 64.71% of its industry peers.
- TCS's Profit Margin has improved in the last couple of years.
- TCS has a better Operating Margin (4.94%) than 67.65% of its industry peers.
- In the last couple of years the Operating Margin of TCS has declined.
- The Gross Margin of TCS (50.47%) is better than 60.29% of its industry peers.
- In the last couple of years the Gross Margin of TCS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.94% | ||
| PM (TTM) | 2.91% | ||
| GM | 50.47% |
OM growth 3Y1.27%
OM growth 5Y-3.5%
PM growth 3Y-8.18%
PM growth 5Y2.88%
GM growth 3Y3.22%
GM growth 5Y0.16%
2. Health
2.1 Basic Checks
- TCS has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- TCS has about the same amout of shares outstanding than it did 1 year ago.
- The number of shares outstanding for TCS has been increased compared to 5 years ago.
- TCS has a better debt/assets ratio than last year.
2.2 Solvency
- TCS has an Altman-Z score of 5.50. This indicates that TCS is financially healthy and has little risk of bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 5.50, TCS is in the better half of the industry, outperforming 77.94% of the companies in the same industry.
- The Debt to FCF ratio of TCS is 0.04, which is an excellent value as it means it would take TCS, only 0.04 years of fcf income to pay off all of its debts.
- TCS's Debt to FCF ratio of 0.04 is amongst the best of the industry. TCS outperforms 92.65% of its industry peers.
- A Debt/Equity ratio of 0.00 indicates that TCS is not too dependend on debt financing.
- TCS has a better Debt to Equity ratio (0.00) than 80.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.04 | ||
| Altman-Z | 5.5 |
ROIC/WACC0.87
WACC10.24%
2.3 Liquidity
- TCS has a Current Ratio of 1.25. This is a normal value and indicates that TCS is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 1.25, TCS is in line with its industry, outperforming 55.88% of the companies in the same industry.
- A Quick Ratio of 1.13 indicates that TCS should not have too much problems paying its short term obligations.
- TCS has a Quick ratio of 1.13. This is comparable to the rest of the industry: TCS outperforms 52.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.25 | ||
| Quick Ratio | 1.13 |
3. Growth
3.1 Past
- TCS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 111.76%, which is quite impressive.
- Measured over the past years, TCS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.01% on average per year.
- The Revenue has grown by 8.02% in the past year. This is quite good.
- Measured over the past years, TCS shows a quite strong growth in Revenue. The Revenue has been growing by 10.96% on average per year.
EPS 1Y (TTM)111.76%
EPS 3Y27.47%
EPS 5Y10.01%
EPS Q2Q%140%
Revenue 1Y (TTM)8.02%
Revenue growth 3Y8.75%
Revenue growth 5Y10.96%
Sales Q2Q%14.61%
3.2 Future
- TCS is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 55.52% yearly.
- Based on estimates for the next years, TCS will show a small growth in Revenue. The Revenue will grow by 7.37% on average per year.
EPS Next Y27.7%
EPS Next 2Y53.89%
EPS Next 3Y55.52%
EPS Next 5YN/A
Revenue Next Year8.64%
Revenue Next 2Y9.4%
Revenue Next 3Y7.37%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 76.25 indicates a quite expensive valuation of TCS.
- Based on the Price/Earnings ratio, TCS is valued a bit cheaper than the industry average as 64.71% of the companies are valued more expensively.
- The average S&P500 Price/Earnings ratio is at 27.25. TCS is valued rather expensively when compared to this.
- With a Price/Forward Earnings ratio of 39.97, TCS can be considered very expensive at the moment.
- 64.71% of the companies in the same industry are more expensive than TCS, based on the Price/Forward Earnings ratio.
- TCS's Price/Forward Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 25.98.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 76.25 | ||
| Fwd PE | 39.97 |
4.2 Price Multiples
- TCS's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. TCS is cheaper than 60.29% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, TCS is valued a bit cheaper than the industry average as 67.65% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.58 | ||
| EV/EBITDA | 28.96 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- TCS has a very decent profitability rating, which may justify a higher PE ratio.
- TCS's earnings are expected to grow with 55.52% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.75
PEG (5Y)7.62
EPS Next 2Y53.89%
EPS Next 3Y55.52%
5. Dividend
5.1 Amount
- TCS has a Yearly Dividend Yield of 1.28%. Purely for dividend investing, there may be better candidates out there.
- The stock price of TCS dropped by -22.68% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
- TCS's Dividend Yield is rather good when compared to the industry average which is at 0.23. TCS pays more dividend than 97.06% of the companies in the same industry.
- Compared to the average S&P500 Dividend Yield of 1.82, TCS is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.28% |
5.2 History
- The dividend of TCS is nicely growing with an annual growth rate of 10.65%!
- TCS has paid a dividend for at least 10 years, which is a reliable track record.
- TCS has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)10.65%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
- TCS pays out 92.60% of its income as dividend. This is not a sustainable payout ratio.
- TCS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP92.6%
EPS Next 2Y53.89%
EPS Next 3Y55.52%
TECSYS INC / TCS.CA FAQ
Can you provide the ChartMill fundamental rating for TECSYS INC?
ChartMill assigns a fundamental rating of 6 / 10 to TCS.CA.
What is the valuation status of TECSYS INC (TCS.CA) stock?
ChartMill assigns a valuation rating of 4 / 10 to TECSYS INC (TCS.CA). This can be considered as Fairly Valued.
Can you provide the profitability details for TECSYS INC?
TECSYS INC (TCS.CA) has a profitability rating of 6 / 10.
How financially healthy is TECSYS INC?
The financial health rating of TECSYS INC (TCS.CA) is 7 / 10.
What is the expected EPS growth for TECSYS INC (TCS.CA) stock?
The Earnings per Share (EPS) of TECSYS INC (TCS.CA) is expected to grow by 27.7% in the next year.