Stantec Inc. Fundamental Analysis (NYSE: STN)
Stantec Inc. (NYSE: STN) shows moderate financial fundamentals with a PE ratio of 23.00, profit margin of 6.23%, and ROE of 15.26%. The company generates $8.1B in annual revenue with strong year-over-year growth of 38.82%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 68.2/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze STN's fundamental strength across five key dimensions:
Efficiency Score
WeakSTN struggles to generate sufficient returns from assets.
Valuation Score
ExcellentSTN trades at attractive valuation levels.
Growth Score
ExcellentSTN delivers strong and consistent growth momentum.
Financial Health Score
ExcellentSTN maintains a strong and stable balance sheet.
Profitability Score
ModerateSTN maintains healthy but balanced margins.
Key Financial Metrics
Is STN Expensive or Cheap?
P/E Ratio
STN trades at 23.00 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, STN's PEG of 1.04 indicates fair valuation.
Price to Book
The market values Stantec Inc. at 3.42 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 8.02 times EBITDA. This is generally considered low.
How Well Does STN Make Money?
Net Profit Margin
For every $100 in sales, Stantec Inc. keeps $6.23 as profit after all expenses.
Operating Margin
Core operations generate 10.32 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $15.26 in profit for every $100 of shareholder equity.
ROA
Stantec Inc. generates $6.14 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Stantec Inc. generates limited operating cash flow of $747.56M, signaling weaker underlying cash strength.
Free Cash Flow
Stantec Inc. produces free cash flow of $668.87M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $5.86 in free cash annually.
FCF Yield
STN converts 5.69% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
23.00
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.04
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.42
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.44
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.80
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.50
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.15
vs 25 benchmark
ROA
Return on assets percentage
0.06
vs 25 benchmark
ROCE
Return on capital employed
0.13
vs 25 benchmark
How STN Stacks Against Its Sector Peers
| Metric | STN Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 23.00 | 30.97 | Better (Cheaper) |
| ROE | 15.26% | 1108.00% | Weak |
| Net Margin | 6.23% | -21241.00% (disorted) | Weak |
| Debt/Equity | 0.80 | 0.79 | Neutral |
| Current Ratio | 1.50 | 21.73 | Neutral |
| ROA | 6.14% | -1325740.00% (disorted) | Weak |
STN outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Stantec Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
116.17%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
174.01%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
39.76%
Industry Style: Cyclical, Value, Infrastructure
High Growth