CAE INC (CAE.CA) Stock Fundamental Analysis

Canada - Toronto Stock Exchange - TSX:CAE - CA1247651088 - Common Stock

45.3 CAD

-0.79 (-1.71%)

Last: 1/28/2026, 7:00:00 PM

Fundamental Rating

Taking everything into account, CAE scores 4 out of 10 in our fundamental rating. CAE was compared to 13 industry peers in the Aerospace & Defense industry. CAE has only an average score on both its financial health and profitability. CAE is quite expensive at the moment. It does show a decent growth rate.

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1. Profitability

1.1 Basic Checks

In the past year CAE was profitable.
CAE had a positive operating cash flow in the past year.
In multiple years CAE reported negative net income over the last 5 years.
Each year in the past 5 years CAE had a positive operating cash flow.

1.2 Ratios

Looking at the Return On Assets, with a value of 3.87%, CAE belongs to the top of the industry, outperforming 84.62% of the companies in the same industry.
CAE has a Return On Equity of 8.45%. This is amongst the best in the industry. CAE outperforms 84.62% of its industry peers.
CAE has a Return On Invested Capital (5.96%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CAE is below the industry average of 8.00%.
The last Return On Invested Capital (5.96%) for CAE is above the 3 year average (5.18%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	3.87%
ROE	8.45%
ROIC	5.96%

ROA(3y)0.89%

ROA(5y)0.72%

ROE(3y)2.01%

ROE(5y)1.61%

ROIC(3y)5.18%

ROIC(5y)4.62%

1.3 Margins

CAE's Profit Margin of 8.88% is amongst the best of the industry. CAE outperforms 92.31% of its industry peers.
CAE's Profit Margin has been stable in the last couple of years.
CAE has a Operating Margin of 13.19%. This is amongst the best in the industry. CAE outperforms 92.31% of its industry peers.
CAE's Operating Margin has declined in the last couple of years.
The Gross Margin of CAE (28.22%) is better than 76.92% of its industry peers.
CAE's Gross Margin has declined in the last couple of years.

		Industry Rank	Sector Rank
OM	13.19%
PM (TTM)	8.88%
GM	28.22%

OM growth 3Y4.74%

OM growth 5Y-1.9%

PM growth 3Y27%

PM growth 5Y0.03%

GM growth 3Y-0.86%

GM growth 5Y-1.58%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so CAE is destroying value.
The number of shares outstanding for CAE has been increased compared to 1 year ago.
The number of shares outstanding for CAE has been increased compared to 5 years ago.
Compared to 1 year ago, CAE has an improved debt to assets ratio.

2.2 Solvency

CAE has an Altman-Z score of 2.32. This is not the best score and indicates that CAE is in the grey zone with still only limited risk for bankruptcy at the moment.
CAE has a better Altman-Z score (2.32) than 92.31% of its industry peers.
The Debt to FCF ratio of CAE is 7.20, which is on the high side as it means it would take CAE, 7.20 years of fcf income to pay off all of its debts.
CAE's Debt to FCF ratio of 7.20 is fine compared to the rest of the industry. CAE outperforms 76.92% of its industry peers.
CAE has a Debt/Equity ratio of 0.61. This is a neutral value indicating CAE is somewhat dependend on debt financing.
With a decent Debt to Equity ratio value of 0.61, CAE is doing good in the industry, outperforming 61.54% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.61
Debt/FCF	7.2
Altman-Z	2.32

ROIC/WACC0.64

WACC9.35%

2.3 Liquidity

CAE has a Current Ratio of 0.83. This is a bad value and indicates that CAE is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.83, CAE is doing worse than 76.92% of the companies in the same industry.
A Quick Ratio of 0.59 indicates that CAE may have some problems paying its short term obligations.
CAE's Quick ratio of 0.59 is fine compared to the rest of the industry. CAE outperforms 61.54% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	0.83
Quick Ratio	0.59

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

CAE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.21%, which is quite good.
CAE shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -2.17% yearly.
CAE shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.12%.
CAE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.38% yearly.

EPS 1Y (TTM)13.21%

EPS 3Y12.94%

EPS 5Y-2.17%

EPS Q2Q%-4.17%

Revenue 1Y (TTM)9.12%

Revenue growth 3Y11.77%

Revenue growth 5Y5.38%

Sales Q2Q%8.8%

3.2 Future

Based on estimates for the next years, CAE will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.25% on average per year.
The Revenue is expected to grow by 5.95% on average over the next years.

EPS Next Y1.92%

EPS Next 2Y11.93%

EPS Next 3Y14.29%

EPS Next 5Y15.25%

Revenue Next Year4.9%

Revenue Next 2Y5.14%

Revenue Next 3Y5.58%

Revenue Next 5Y5.95%

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 stable.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 37.75, which means the current valuation is very expensive for CAE.
Based on the Price/Earnings ratio, CAE is valued a bit more expensive than the industry average as 69.23% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of CAE to the average of the S&P500 Index (28.60), we can say CAE is valued slightly more expensively.
A Price/Forward Earnings ratio of 29.88 indicates a quite expensive valuation of CAE.
69.23% of the companies in the same industry are cheaper than CAE, based on the Price/Forward Earnings ratio.
CAE is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 25.83, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	37.75
Fwd PE	29.88

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of CAE indicates a slightly more expensive valuation: CAE is more expensive than 61.54% of the companies listed in the same industry.
CAE's Price/Free Cash Flow ratio is in line with the industry average.

		Industry Rank	Sector Rank
P/FCF	31.15
EV/EBITDA	16.4

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
CAE has a very decent profitability rating, which may justify a higher PE ratio.
CAE's earnings are expected to grow with 14.29% in the coming years. This may justify a more expensive valuation.