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AG GROWTH INTERNATIONAL INC (AFN.CA) Stock Fundamental Analysis

TSX:AFN - Toronto Stock Exchange - CA0011811068 - Common Stock - Currency: CAD

37.36  -0.35 (-0.93%)

Fundamental Rating

5

We assign a fundamental rating of 5 out of 10 to AFN. AFN was compared to 21 industry peers in the Machinery industry. AFN has an excellent profitability rating, but there are concerns on its financial health. AFN is valued quite cheap, but it does not seem to be growing.


Dividend Valuation Growth Profitability Health

8

1. Profitability

1.1 Basic Checks

AFN had positive earnings in the past year.
In the past year AFN had a positive cash flow from operations.
In multiple years AFN reported negative net income over the last 5 years.
In the past 5 years AFN always reported a positive cash flow from operatings.
AFN.CA Yearly Net Income VS EBIT VS OCF VS FCFAFN.CA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 50M -50M 100M 150M

1.2 Ratios

AFN has a Return On Assets of 1.46%. This is in the better half of the industry: AFN outperforms 71.43% of its industry peers.
Looking at the Return On Equity, with a value of 7.43%, AFN belongs to the top of the industry, outperforming 80.95% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 10.86%, AFN belongs to the top of the industry, outperforming 90.48% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for AFN is in line with the industry average of 10.25%.
The last Return On Invested Capital (10.86%) for AFN is above the 3 year average (8.69%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 1.46%
ROE 7.43%
ROIC 10.86%
ROA(3y)0.58%
ROA(5y)-0.28%
ROE(3y)2.18%
ROE(5y)-2.59%
ROIC(3y)8.69%
ROIC(5y)6.2%
AFN.CA Yearly ROA, ROE, ROICAFN.CA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 10 -10 20 -20

1.3 Margins

The Profit Margin of AFN (1.71%) is better than 71.43% of its industry peers.
In the last couple of years the Profit Margin of AFN has grown nicely.
With an excellent Operating Margin value of 11.36%, AFN belongs to the best of the industry, outperforming 95.24% of the companies in the same industry.
AFN's Operating Margin has been stable in the last couple of years.
The Gross Margin of AFN (32.05%) is better than 80.95% of its industry peers.
AFN's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 11.36%
PM (TTM) 1.71%
GM 32.05%
OM growth 3Y370.76%
OM growth 5Y0.79%
PM growth 3YN/A
PM growth 5Y9.59%
GM growth 3Y14.71%
GM growth 5Y1.74%
AFN.CA Yearly Profit, Operating, Gross MarginsAFN.CA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 10 20 30

3

2. Health

2.1 Basic Checks

AFN has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, AFN has more shares outstanding
Compared to 5 years ago, AFN has more shares outstanding
AFN has a better debt/assets ratio than last year.
AFN.CA Yearly Shares OutstandingAFN.CA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 5M 10M 15M
AFN.CA Yearly Total Debt VS Total AssetsAFN.CA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 500M 1B 1.5B

2.2 Solvency

Based on the Altman-Z score of 1.45, we must say that AFN is in the distress zone and has some risk of bankruptcy.
AFN has a Altman-Z score (1.45) which is comparable to the rest of the industry.
The Debt to FCF ratio of AFN is 8.04, which is on the high side as it means it would take AFN, 8.04 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 8.04, AFN is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
A Debt/Equity ratio of 2.48 is on the high side and indicates that AFN has dependencies on debt financing.
With a Debt to Equity ratio value of 2.48, AFN is not doing good in the industry: 71.43% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 2.48
Debt/FCF 8.04
Altman-Z 1.45
ROIC/WACC1.13
WACC9.6%
AFN.CA Yearly LT Debt VS Equity VS FCFAFN.CA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 200M 400M 600M 800M

2.3 Liquidity

A Current Ratio of 1.41 indicates that AFN should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.41, AFN is doing worse than 66.67% of the companies in the same industry.
AFN has a Quick Ratio of 1.41. This is a bad value and indicates that AFN is not financially healthy enough and could expect problems in meeting its short term obligations.
AFN has a Quick ratio of 0.97. This is in the better half of the industry: AFN outperforms 66.67% of its industry peers.
Industry RankSector Rank
Current Ratio 1.41
Quick Ratio 0.97
AFN.CA Yearly Current Assets VS Current LiabilitesAFN.CA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M

3

3. Growth

3.1 Past

The earnings per share for AFN have decreased by -5.17% in the last year.
AFN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.91% yearly.
Looking at the last year, AFN shows a decrease in Revenue. The Revenue has decreased by -7.79% in the last year.
The Revenue has been growing by 10.38% on average over the past years. This is quite good.
EPS 1Y (TTM)-5.17%
EPS 3Y23.43%
EPS 5Y11.91%
EPS Q2Q%-22.22%
Revenue 1Y (TTM)-7.79%
Revenue growth 3Y15.38%
Revenue growth 5Y10.38%
Sales Q2Q%-12.9%

3.2 Future

AFN is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -4.27% yearly.
AFN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.28% yearly.
EPS Next Y-22.03%
EPS Next 2Y-14%
EPS Next 3Y-4.27%
EPS Next 5YN/A
Revenue Next Year-8.97%
Revenue Next 2Y-3.63%
Revenue Next 3Y0.25%
Revenue Next 5Y5.28%

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 decreasing.
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.
AFN.CA Yearly Revenue VS EstimatesAFN.CA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 500M 1B 1.5B 2B
AFN.CA Yearly EPS VS EstimatesAFN.CA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 1 2 3 4 5

8

4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 7.83, the valuation of AFN can be described as very cheap.
Based on the Price/Earnings ratio, AFN is valued cheaply inside the industry as 95.24% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of AFN to the average of the S&P500 Index (30.19), we can say AFN is valued rather cheaply.
A Price/Forward Earnings ratio of 8.69 indicates a reasonable valuation of AFN.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AFN indicates a rather cheap valuation: AFN is cheaper than 95.24% of the companies listed in the same industry.
AFN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.58.
Industry RankSector Rank
PE 7.83
Fwd PE 8.69
AFN.CA Price Earnings VS Forward Price EarningsAFN.CA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, AFN is valued cheaper than 90.48% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AFN is valued cheaper than 100.00% of the companies in the same industry.
Industry RankSector Rank
P/FCF 6.42
EV/EBITDA 6.67
AFN.CA Per share dataAFN.CA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 20 40 60

4.3 Compensation for Growth

The excellent profitability rating of AFN may justify a higher PE ratio.
A cheap valuation may be justified as AFN's earnings are expected to decrease with -4.27% in the coming years.
PEG (NY)N/A
PEG (5Y)0.66
EPS Next 2Y-14%
EPS Next 3Y-4.27%

3

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 1.59%, AFN has a reasonable but not impressive dividend return.
In the last 3 months the price of AFN has falen by -27.60%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
AFN's Dividend Yield is a higher than the industry average which is at 20.84.
AFN's Dividend Yield is slightly below the S&P500 average, which is at 2.30.
Industry RankSector Rank
Dividend Yield 1.59%

5.2 History

The dividend of AFN decreases each year by -23.35%.
AFN has paid a dividend for at least 10 years, which is a reliable track record.
AFN has decreased its dividend in the last 3 years.
Dividend Growth(5Y)-23.35%
Div Incr Years0
Div Non Decr Years2
AFN.CA Yearly Dividends per shareAFN.CA Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0.5 1 1.5 2

5.3 Sustainability

AFN pays out 47.72% of its income as dividend. This is a bit on the high side, but may be sustainable.
The Dividend Rate of AFN has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP47.72%
EPS Next 2Y-14%
EPS Next 3Y-4.27%
AFN.CA Yearly Income VS Free CF VS DividendAFN.CA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20M -20M 40M -40M 60M -60M
AFN.CA Dividend Payout.AFN.CA Dividend Payout, showing the Payout Ratio.AFN.CA Dividend Payout.PayoutRetained Earnings

AG GROWTH INTERNATIONAL INC

TSX:AFN (2/14/2025, 7:00:00 PM)

37.36

-0.35 (-0.93%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)11-05 2024-11-05/amc
Earnings (Next)03-05 2025-03-05
Inst Owners27.88%
Inst Owner ChangeN/A
Ins Owners0.32%
Ins Owner ChangeN/A
Market Cap712.46M
Analysts76.67
Price Target60.69 (62.45%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.59%
Yearly Dividend0.6
Dividend Growth(5Y)-23.35%
DP47.72%
Div Incr Years0
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-23.8%
Min EPS beat(2)-29.25%
Max EPS beat(2)-18.34%
EPS beat(4)1
Avg EPS beat(4)-13.43%
Min EPS beat(4)-45.74%
Max EPS beat(4)39.6%
EPS beat(8)3
Avg EPS beat(8)4.07%
EPS beat(12)6
Avg EPS beat(12)7.72%
EPS beat(16)10
Avg EPS beat(16)436.32%
Revenue beat(2)0
Avg Revenue beat(2)-12.66%
Min Revenue beat(2)-13.37%
Max Revenue beat(2)-11.94%
Revenue beat(4)0
Avg Revenue beat(4)-11.81%
Min Revenue beat(4)-13.37%
Max Revenue beat(4)-9.15%
Revenue beat(8)2
Avg Revenue beat(8)-6.14%
Revenue beat(12)5
Avg Revenue beat(12)-2.59%
Revenue beat(16)5
Avg Revenue beat(16)-2.74%
PT rev (1m)-17.65%
PT rev (3m)-21.45%
EPS NQ rev (1m)-33.57%
EPS NQ rev (3m)-16.87%
EPS NY rev (1m)-15.26%
EPS NY rev (3m)-24.3%
Revenue NQ rev (1m)-12.92%
Revenue NQ rev (3m)-11.93%
Revenue NY rev (1m)-3.7%
Revenue NY rev (3m)-8.39%
Valuation
Industry RankSector Rank
PE 7.83
Fwd PE 8.69
P/S 0.51
P/FCF 6.42
P/OCF 4.56
P/B 2.21
P/tB N/A
EV/EBITDA 6.67
EPS(TTM)4.77
EY12.77%
EPS(NY)4.3
Fwd EY11.5%
FCF(TTM)5.82
FCFY15.59%
OCF(TTM)8.18
OCFY21.91%
SpS73.56
BVpS16.88
TBVpS-11.31
PEG (NY)N/A
PEG (5Y)0.66
Profitability
Industry RankSector Rank
ROA 1.46%
ROE 7.43%
ROCE 13.57%
ROIC 10.86%
ROICexc 11.8%
ROICexgc 23.49%
OM 11.36%
PM (TTM) 1.71%
GM 32.05%
FCFM 7.92%
ROA(3y)0.58%
ROA(5y)-0.28%
ROE(3y)2.18%
ROE(5y)-2.59%
ROIC(3y)8.69%
ROIC(5y)6.2%
ROICexc(3y)9.29%
ROICexc(5y)6.61%
ROICexgc(3y)19.79%
ROICexgc(5y)14.08%
ROCE(3y)10.85%
ROCE(5y)7.75%
ROICexcg growth 3Y457.17%
ROICexcg growth 5Y11.88%
ROICexc growth 3Y458.14%
ROICexc growth 5Y10.2%
OM growth 3Y370.76%
OM growth 5Y0.79%
PM growth 3YN/A
PM growth 5Y9.59%
GM growth 3Y14.71%
GM growth 5Y1.74%
F-Score6
Asset Turnover0.85
Health
Industry RankSector Rank
Debt/Equity 2.48
Debt/FCF 8.04
Debt/EBITDA 3.52
Cap/Depr 67.02%
Cap/Sales 3.21%
Interest Coverage 2.59
Cash Conversion 68.88%
Profit Quality 463.98%
Current Ratio 1.41
Quick Ratio 0.97
Altman-Z 1.45
F-Score6
WACC9.6%
ROIC/WACC1.13
Cap/Depr(3y)77.42%
Cap/Depr(5y)86.62%
Cap/Sales(3y)3.7%
Cap/Sales(5y)4.27%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.17%
EPS 3Y23.43%
EPS 5Y11.91%
EPS Q2Q%-22.22%
EPS Next Y-22.03%
EPS Next 2Y-14%
EPS Next 3Y-4.27%
EPS Next 5YN/A
Revenue 1Y (TTM)-7.79%
Revenue growth 3Y15.38%
Revenue growth 5Y10.38%
Sales Q2Q%-12.9%
Revenue Next Year-8.97%
Revenue Next 2Y-3.63%
Revenue Next 3Y0.25%
Revenue Next 5Y5.28%
EBIT growth 1Y-0.81%
EBIT growth 3Y443.15%
EBIT growth 5Y11.26%
EBIT Next Year82.14%
EBIT Next 3Y28.92%
EBIT Next 5YN/A
FCF growth 1Y2058.97%
FCF growth 3Y12.87%
FCF growth 5YN/A
OCF growth 1Y286.54%
OCF growth 3Y12.51%
OCF growth 5Y20.72%