AIR CANADA (AC.CA) Stock Fundamental Analysis
Canada - TSX:AC - CA0089118776 - Common Stock
18.64 CAD
-0.3 (-1.58%)
AC gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 7 industry peers in the Passenger Airlines industry. AC may be in some trouble as it scores bad on both profitability and health. AC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
AC had positive earnings in the past year.
AC had a positive operating cash flow in the past year.
In multiple years AC reported negative net income over the last 5 years.
In multiple years AC reported negative operating cash flow during the last 5 years.
1.2 Ratios
AC has a Return On Assets (-0.95%) which is in line with its industry peers.
AC has a Return On Equity (-13.57%) which is in line with its industry peers.
The Return On Invested Capital of AC (2.20%) is worse than 71.43% of 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
AC's Profit Margin has been stable in the last couple of years.
AC has a Operating Margin of 2.33%. This is comparable to the rest of the industry: AC outperforms 42.86% of its industry peers.
In the last couple of years the Operating Margin of AC has declined.
The Gross Margin of AC (61.41%) is better than 71.43% of its industry peers.
AC's Gross Margin has been stable in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AC is destroying value.
Compared to 1 year ago, AC has less shares outstanding
AC has more shares outstanding than it did 5 years ago.
AC has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.64, we must say that AC is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 0.64, AC is doing worse than 85.71% of the companies in the same industry.
AC has a debt to FCF ratio of 16.12. This is a negative value and a sign of low solvency as AC would need 16.12 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 16.12, AC is doing good in the industry, outperforming 71.43% of the companies in the same industry.
A Debt/Equity ratio of 3.99 is on the high side and indicates that AC has dependencies on debt financing.
AC has a worse Debt to Equity ratio (3.99) than 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.99 | ||
| Debt/FCF | 16.12 | ||
| Altman-Z | 0.64 |
ROIC/WACC0.31
WACC7.03%
2.3 Liquidity
A Current Ratio of 0.59 indicates that AC may have some problems paying its short term obligations.
AC has a Current ratio of 0.59. This is amonst the worse of the industry: AC underperforms 85.71% of its industry peers.
AC has a Quick Ratio of 0.59. This is a bad value and indicates that AC is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of AC (0.56) is worse than 85.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.59 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
AC shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -62.80%.
Measured over the past 5 years, AC shows a small growth in Earnings Per Share. The EPS has been growing by 0.87% on average per year.
AC shows a decrease in Revenue. In the last year, the revenue decreased by -0.09%.
AC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.07% yearly.
EPS 1Y (TTM)-62.8%
EPS 3YN/A
EPS 5Y0.87%
EPS Q2Q%-69.82%
Revenue 1Y (TTM)-0.09%
Revenue growth 3Y51.5%
Revenue growth 5Y3.07%
Sales Q2Q%-3.16%
3.2 Future
The Earnings Per Share is expected to grow by 5.33% on average over the next years.
AC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.39% yearly.
EPS Next Y-66.18%
EPS Next 2Y-16.34%
EPS Next 3Y-5.17%
EPS Next 5Y5.33%
Revenue Next Year0.67%
Revenue Next 2Y4.2%
Revenue Next 3Y5.04%
Revenue Next 5Y5.39%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
AC is valuated correctly with a Price/Earnings ratio of 15.80.
85.71% of the companies in the same industry are more expensive than AC, based on the Price/Earnings ratio.
AC is valuated rather cheaply when we compare the Price/Earnings ratio to 25.89, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 7.55, the valuation of AC can be described as very cheap.
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.
The average S&P500 Price/Forward Earnings ratio is at 34.59. AC is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.8 | ||
| Fwd PE | 7.55 |
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 cheaply inside the industry as 85.71% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.56 | ||
| EV/EBITDA | 3.4 |
4.3 Compensation for Growth
A cheap valuation may be justified as AC's earnings are expected to decrease with -5.17% in the coming years.
PEG (NY)N/A
PEG (5Y)18.11
EPS Next 2Y-16.34%
EPS Next 3Y-5.17%
5. Dividend
5.1 Amount
No dividends for AC!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
TSX:AC (11/14/2025, 7:00:00 PM)
18.64
-0.3 (-1.58%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupTransportation
GICS IndustryPassenger Airlines
Earnings (Last)
Earnings (Next)
Inst Owners18.67%
Inst Owner ChangeN/A
Ins Owners0.23%
Ins Owner ChangeN/A
Market Cap5.52B
Revenue(TTM)22.01B
Net Income(TTM)-296.00M
Analysts81.74
Price Target25.19 (35.14%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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)-19.69%
Min EPS beat(2)-20.67%
Max EPS beat(2)-18.71%
EPS beat(4)1
Avg EPS beat(4)-7.19%
Min EPS beat(4)-20.67%
Max EPS beat(4)18.62%
EPS beat(8)3
Avg EPS beat(8)-56.19%
EPS beat(12)6
Avg EPS beat(12)-32.2%
EPS beat(16)8
Avg EPS beat(16)-16.6%
Revenue beat(2)0
Avg Revenue beat(2)-1.51%
Min Revenue beat(2)-1.53%
Max Revenue beat(2)-1.49%
Revenue beat(4)1
Avg Revenue beat(4)-1.36%
Min Revenue beat(4)-4.63%
Max Revenue beat(4)2.21%
Revenue beat(8)1
Avg Revenue beat(8)-1.82%
Revenue beat(12)5
Avg Revenue beat(12)0.1%
Revenue beat(16)7
Avg Revenue beat(16)0.48%
PT rev (1m)-0.93%
PT rev (3m)-2.44%
EPS NQ rev (1m)-11.63%
EPS NQ rev (3m)-8.82%
EPS NY rev (1m)-32.38%
EPS NY rev (3m)-43.17%
Revenue NQ rev (1m)-0.09%
Revenue NQ rev (3m)0.07%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)-1.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.8 | ||
| Fwd PE | 7.55 | ||
| P/S | 0.25 | ||
| P/FCF | 7.56 | ||
| P/OCF | 1.41 | ||
| P/B | 2.53 | ||
| P/tB | N/A | ||
| EV/EBITDA | 3.4 |
EPS(TTM)1.18
EY6.33%
EPS(NY)2.47
Fwd EY13.25%
FCF(TTM)2.46
FCFY13.22%
OCF(TTM)13.2
OCFY70.84%
SpS74.29
BVpS7.36
TBVpS-7.79
PEG (NY)N/A
PEG (5Y)18.11
Graham Number13.98
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 | 0.64 |
F-Score5
WACC7.03%
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)-62.8%
EPS 3YN/A
EPS 5Y0.87%
EPS Q2Q%-69.82%
EPS Next Y-66.18%
EPS Next 2Y-16.34%
EPS Next 3Y-5.17%
EPS Next 5Y5.33%
Revenue 1Y (TTM)-0.09%
Revenue growth 3Y51.5%
Revenue growth 5Y3.07%
Sales Q2Q%-3.16%
Revenue Next Year0.67%
Revenue Next 2Y4.2%
Revenue Next 3Y5.04%
Revenue Next 5Y5.39%
EBIT growth 1Y-67.86%
EBIT growth 3YN/A
EBIT growth 5Y-5.21%
EBIT Next Year106.82%
EBIT Next 3Y38.06%
EBIT Next 5Y23.83%
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.
What is the valuation status for AC stock?
ChartMill assigns a valuation rating of 6 / 10 to AIR CANADA (AC.CA). This can be considered as Fairly Valued.
Can you provide the profitability details for AIR CANADA?
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.