Aecon Group Inc.
Aecon Group Inc. Fundamental Analysis
Aecon Group Inc. (ARE.TO) shows weak financial fundamentals with a PE ratio of 196.99, profit margin of 0.28%, and ROE of 1.66%. The company generates $5.8B in annual revenue with weak year-over-year growth of -8.64%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 13.6/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ARE.TO's fundamental strength across five key dimensions:
Efficiency Score
WeakARE.TO struggles to generate sufficient returns from assets.
Valuation Score
WeakARE.TO trades at a premium to fair value.
Growth Score
WeakARE.TO faces weak or negative growth trends.
Financial Health Score
ExcellentARE.TO maintains a strong and stable balance sheet.
Profitability Score
ModerateARE.TO maintains healthy but balanced margins.
Key Financial Metrics
Is ARE.TO Expensive or Cheap?
P/E Ratio
ARE.TO trades at 196.99 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, ARE.TO's PEG of 2.56 indicates potential overvaluation.
Price to Book
The market values Aecon Group Inc. at 3.24 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 20.54 times EBITDA. This signals the market has high growth expectations.
How Well Does ARE.TO Make Money?
Net Profit Margin
For every $100 in sales, Aecon Group Inc. keeps $0.28 as profit after all expenses.
Operating Margin
Core operations generate 0.90 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $1.66 in profit for every $100 of shareholder equity.
ROA
Aecon Group Inc. generates $0.38 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Aecon Group Inc. generates limited operating cash flow of $135.31M, signaling weaker underlying cash strength.
Free Cash Flow
Aecon Group Inc. generates weak or negative free cash flow of $64.17M, restricting financial flexibility.
FCF Per Share
Each share generates $0.94 in free cash annually.
FCF Yield
ARE.TO converts 1.89% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
196.99
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.56
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.24
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.59
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.65
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.10
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.02
vs 25 benchmark
ROA
Return on assets percentage
0.004
vs 25 benchmark
ROCE
Return on capital employed
0.04
vs 25 benchmark
How ARE.TO Stacks Against Its Sector Peers
| Metric | ARE.TO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 196.99 | 26.72 | Worse (Expensive) |
| ROE | 1.66% | 1297.00% | Weak |
| Net Margin | 0.28% | -38908.00% (disorted) | Weak |
| Debt/Equity | 0.65 | 0.72 | Neutral |
| Current Ratio | 1.10 | 10.10 | Neutral |
| ROA | 0.38% | -1511770.00% (disorted) | Weak |
ARE.TO outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Aecon Group Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
18.36%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
-178.87%
Industry Style: Cyclical, Value, Infrastructure
DecliningFCF CAGR
-86.40%
Industry Style: Cyclical, Value, Infrastructure
Declining