AIR CANADA (AC.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:AC - CA0089118776 - Common Stock
19.29 CAD
+0.1 (+0.52%)
We assign a fundamental rating of 3 out of 10 to AC. AC was compared to 5 industry peers in the Passenger Airlines industry. AC has a bad profitability rating. Also its financial health evaluation is rather negative. AC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
AC had positive earnings in the past year.
In the past year AC had a positive cash flow from operations.
In multiple years AC reported negative net income over the last 5 years.
The reported operating cash flow has been mixed in the past 5 years: AC reported negative operating cash flow in multiple years.
1.2 Ratios
With a Return On Assets value of -0.95%, AC perfoms like the industry average, outperforming 60.00% of the companies in the same industry.
AC has a Return On Equity (-13.57%) which is comparable to the rest of the industry.
AC has a Return On Invested Capital (2.20%) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.95% | ||
| ROE | -13.57% | ||
| ROIC | 2.2% |
ROA(3y)2.43%
ROA(5y)-4.11%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
In the last couple of years the Profit Margin of AC has remained more or less at the same level.
The Operating Margin of AC (2.33%) is comparable to the rest of the industry.
AC's Operating Margin has declined in the last couple of years.
AC has a Gross Margin of 61.41%. This is in the better half of the industry: AC outperforms 80.00% of its industry peers.
In the last couple of years the Gross Margin of AC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.33% | ||
| PM (TTM) | N/A | ||
| GM | 61.41% |
OM growth 3YN/A
OM growth 5Y-8.03%
PM growth 3YN/A
PM growth 5Y0.03%
GM growth 3Y10.66%
GM growth 5Y0.35%
2. Health
2.1 Basic Checks
AC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for AC has been reduced compared to 1 year ago.
AC has more shares outstanding than it did 5 years ago.
AC has a better debt/assets ratio than last year.
2.2 Solvency
AC has an Altman-Z score of 0.65. This is a bad value and indicates that AC is not financially healthy and even has some risk of bankruptcy.
AC has a Altman-Z score of 0.65. This is amonst the worse of the industry: AC underperforms 80.00% of its industry peers.
The Debt to FCF ratio of AC is 16.12, which is on the high side as it means it would take AC, 16.12 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 16.12, AC is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
AC has a Debt/Equity ratio of 3.99. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 3.99, AC is doing worse than 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.99 | ||
| Debt/FCF | 16.12 | ||
| Altman-Z | 0.65 |
ROIC/WACC0.31
WACC7.09%
2.3 Liquidity
A Current Ratio of 0.59 indicates that AC may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.59, AC is doing worse than 80.00% of the companies in the same industry.
A Quick Ratio of 0.56 indicates that AC may have some problems paying its short term obligations.
AC has a worse Quick ratio (0.56) than 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
The earnings per share for AC have decreased strongly by -63.61% in the last year.
The Earnings Per Share has been growing slightly by 0.87% on average over the past years.
The Revenue has decreased by -0.09% in the past year.
Measured over the past years, AC shows a small growth in Revenue. The Revenue has been growing by 3.07% on average per year.
EPS 1Y (TTM)-63.61%
EPS 3YN/A
EPS 5Y0.87%
EPS Q2Q%-70.82%
Revenue 1Y (TTM)-0.09%
Revenue growth 3Y51.5%
Revenue growth 5Y3.07%
Sales Q2Q%-5.44%
3.2 Future
The Earnings Per Share is expected to grow by 15.75% on average over the next years. This is quite good.
Based on estimates for the next years, AC will show a small growth in Revenue. The Revenue will grow by 5.79% on average per year.
EPS Next Y-65.47%
EPS Next 2Y-20.94%
EPS Next 3Y-6.76%
EPS Next 5Y15.75%
Revenue Next Year0.83%
Revenue Next 2Y4%
Revenue Next 3Y4.92%
Revenue Next 5Y5.79%
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 accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 16.77, which indicates a correct valuation of AC.
80.00% of the companies in the same industry are more expensive than AC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of AC to the average of the S&P500 Index (26.51), we can say AC is valued slightly cheaper.
A Price/Forward Earnings ratio of 8.74 indicates a reasonable valuation of AC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AC indicates a rather cheap valuation: AC is cheaper than 100.00% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.13, AC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.77 | ||
| Fwd PE | 8.74 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AC is valued cheaper than 100.00% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AC is valued a bit cheaper than the industry average as 80.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.83 | ||
| EV/EBITDA | 3.48 |
4.3 Compensation for Growth
AC's earnings are expected to decrease with -6.76% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)19.23
EPS Next 2Y-20.94%
EPS Next 3Y-6.76%
5. Dividend
5.1 Amount
No dividends for AC!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
TSX:AC (12/31/2025, 7:00:00 PM)
19.29
+0.1 (+0.52%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryPassenger Airlines
Earnings (Last)
Earnings (Next)
Inst Owners17.52%
Inst Owner ChangeN/A
Ins Owners0.23%
Ins Owner ChangeN/A
Market Cap5.71B
Revenue(TTM)22.01B
Net Income(TTM)-296.00M
Analysts81.74
Price Target25.16 (30.43%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-21%
Min EPS beat(2)-23.28%
Max EPS beat(2)-18.71%
EPS beat(4)1
Avg EPS beat(4)-7.85%
Min EPS beat(4)-23.28%
Max EPS beat(4)18.62%
EPS beat(8)3
Avg EPS beat(8)-56.52%
EPS beat(12)6
Avg EPS beat(12)-32.42%
EPS beat(16)8
Avg EPS beat(16)-16.77%
Revenue beat(2)0
Avg Revenue beat(2)-2.67%
Min Revenue beat(2)-3.85%
Max Revenue beat(2)-1.49%
Revenue beat(4)1
Avg Revenue beat(4)-1.94%
Min Revenue beat(4)-4.63%
Max Revenue beat(4)2.21%
Revenue beat(8)1
Avg Revenue beat(8)-2.11%
Revenue beat(12)5
Avg Revenue beat(12)-0.09%
Revenue beat(16)7
Avg Revenue beat(16)0.33%
PT rev (1m)-1.05%
PT rev (3m)-5.41%
EPS NQ rev (1m)0%
EPS NQ rev (3m)64.51%
EPS NY rev (1m)2.08%
EPS NY rev (3m)-30.97%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.25%
Revenue NY rev (1m)0.16%
Revenue NY rev (3m)-1.17%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.77 | ||
| Fwd PE | 8.74 | ||
| P/S | 0.26 | ||
| P/FCF | 7.83 | ||
| P/OCF | 1.46 | ||
| P/B | 2.62 | ||
| P/tB | N/A | ||
| EV/EBITDA | 3.48 |
EPS(TTM)1.15
EY5.96%
EPS(NY)2.21
Fwd EY11.44%
FCF(TTM)2.46
FCFY12.78%
OCF(TTM)13.2
OCFY68.45%
SpS74.29
BVpS7.36
TBVpS-7.79
PEG (NY)N/A
PEG (5Y)19.23
Graham Number13.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.95% | ||
| ROE | -13.57% | ||
| ROCE | 3.05% | ||
| ROIC | 2.2% | ||
| ROICexc | 3.55% | ||
| ROICexgc | 6.25% | ||
| OM | 2.33% | ||
| PM (TTM) | N/A | ||
| GM | 61.41% | ||
| FCFM | 3.32% |
ROA(3y)2.43%
ROA(5y)-4.11%
ROE(3y)N/A
ROE(5y)N/A
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
ROICexgc growth 3YN/A
ROICexgc growth 5Y-2.05%
ROICexc growth 3YN/A
ROICexc growth 5Y-3.33%
OM growth 3YN/A
OM growth 5Y-8.03%
PM growth 3YN/A
PM growth 5Y0.03%
GM growth 3Y10.66%
GM growth 5Y0.35%
F-Score5
Asset Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.99 | ||
| Debt/FCF | 16.12 | ||
| Debt/EBITDA | 3.53 | ||
| Cap/Depr | 163.13% | ||
| Cap/Sales | 14.46% | ||
| Interest Coverage | 0.84 | ||
| Cash Conversion | 158.79% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | 0.65 |
F-Score5
WACC7.09%
ROIC/WACC0.31
Cap/Depr(3y)111.41%
Cap/Depr(5y)93.12%
Cap/Sales(3y)9.5%
Cap/Sales(5y)13.18%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-63.61%
EPS 3YN/A
EPS 5Y0.87%
EPS Q2Q%-70.82%
EPS Next Y-65.47%
EPS Next 2Y-20.94%
EPS Next 3Y-6.76%
EPS Next 5Y15.75%
Revenue 1Y (TTM)-0.09%
Revenue growth 3Y51.5%
Revenue growth 5Y3.07%
Sales Q2Q%-5.44%
Revenue Next Year0.83%
Revenue Next 2Y4%
Revenue Next 3Y4.92%
Revenue Next 5Y5.79%
EBIT growth 1Y-67.86%
EBIT growth 3YN/A
EBIT growth 5Y-5.21%
EBIT Next Year90.29%
EBIT Next 3Y35.47%
EBIT Next 5Y23.18%
FCF growth 1Y-69.67%
FCF growth 3YN/A
FCF growth 5Y-18.89%
OCF growth 1Y-1.78%
OCF growth 3YN/A
OCF growth 5Y-7.21%
AIR CANADA / AC.CA FAQ
What is the fundamental rating for AC stock?
ChartMill assigns a fundamental rating of 3 / 10 to AC.CA.
Can you provide the valuation status for AIR CANADA?
ChartMill assigns a valuation rating of 5 / 10 to AIR CANADA (AC.CA). This can be considered as Fairly Valued.
How profitable is AIR CANADA (AC.CA) stock?
AIR CANADA (AC.CA) has a profitability rating of 3 / 10.
What is the financial health of AIR CANADA (AC.CA) stock?
The financial health rating of AIR CANADA (AC.CA) is 2 / 10.