Taking everything into account, CECO scores 4 out of 10 in our fundamental rating. CECO was compared to 132 industry peers in the Machinery industry. While CECO is still in line with the averages on profitability rating, there are concerns on its financial health. CECO is valued quite expensively, but it does show have an excellent growth rating.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

CECO had positive earnings in the past year.
In the past year CECO has reported a negative cash flow from operations.
CECO had positive earnings in each of the past 5 years.
CECO had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

The Return On Assets of CECO (5.82%) is better than 65.15% of its industry peers.
CECO has a Return On Equity of 16.78%. This is in the better half of the industry: CECO outperforms 78.03% of its industry peers.
The Return On Invested Capital of CECO (5.78%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for CECO is below the industry average of 10.20%.

		Industry Rank	Sector Rank
ROA	5.82%
ROE	16.78%
ROIC	5.78%

ROA(3y)2.43%

ROA(5y)1.92%

ROE(3y)6.31%

ROE(5y)4.73%

ROIC(3y)6.39%

ROIC(5y)5.34%

1.3 Margins

CECO has a Profit Margin of 7.22%. This is in the better half of the industry: CECO outperforms 62.88% of its industry peers.
CECO's Profit Margin has declined in the last couple of years.
CECO has a Operating Margin of 6.42%. This is comparable to the rest of the industry: CECO outperforms 40.91% of its industry peers.
CECO's Operating Margin has improved in the last couple of years.
The Gross Margin of CECO (34.91%) is better than 62.12% of its industry peers.
In the last couple of years the Gross Margin of CECO has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	6.42%
PM (TTM)	7.22%
GM	34.91%

OM growth 3Y24.13%

OM growth 5Y5.02%

PM growth 3Y75.18%

PM growth 5Y-14.81%

GM growth 3Y4.29%

GM growth 5Y1.11%

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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 CECO is destroying value.
The number of shares outstanding for CECO has been increased compared to 1 year ago.
The number of shares outstanding for CECO has been reduced compared to 5 years ago.
Compared to 1 year ago, CECO has a worse debt to assets ratio.

2.2 Solvency

An Altman-Z score of 3.76 indicates that CECO is not in any danger for bankruptcy at the moment.
The Altman-Z score of CECO (3.76) is better than 63.64% of its industry peers.
A Debt/Equity ratio of 0.71 indicates that CECO is somewhat dependend on debt financing.
CECO has a worse Debt to Equity ratio (0.71) than 68.94% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.71
Debt/FCF	N/A
Altman-Z	3.76

ROIC/WACC0.6

WACC9.64%

2.3 Liquidity

A Current Ratio of 1.33 indicates that CECO should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.33, CECO is doing worse than 81.82% of the companies in the same industry.
A Quick Ratio of 0.76 indicates that CECO may have some problems paying its short term obligations.
CECO's Quick ratio of 0.76 is on the low side compared to the rest of the industry. CECO is outperformed by 80.30% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.33
Quick Ratio	0.76

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 19.18% over the past year.
CECO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.06% yearly.
CECO shows a strong growth in Revenue. In the last year, the Revenue has grown by 29.86%.
Measured over the past years, CECO shows a quite strong growth in Revenue. The Revenue has been growing by 10.29% on average per year.

EPS 1Y (TTM)19.18%

EPS 3Y35.41%

EPS 5Y4.06%

EPS Q2Q%85.71%

Revenue 1Y (TTM)29.86%

Revenue growth 3Y19.85%

Revenue growth 5Y10.29%

Sales Q2Q%45.82%

3.2 Future

Based on estimates for the next years, CECO will show a very strong growth in Earnings Per Share. The EPS will grow by 42.16% on average per year.
Based on estimates for the next years, CECO will show a very strong growth in Revenue. The Revenue will grow by 20.13% on average per year.

EPS Next Y39.51%

EPS Next 2Y43.92%

EPS Next 3Y42.16%

EPS Next 5YN/A

Revenue Next Year36.55%

Revenue Next 2Y25.1%

Revenue Next 3Y20.13%

Revenue Next 5YN/A

3.3 Evolution

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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.

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4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 77.51, CECO can be considered very expensive at the moment.
Based on the Price/Earnings ratio, CECO is valued a bit more expensive than the industry average as 69.70% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of CECO to the average of the S&P500 Index (28.30), we can say CECO is valued expensively.
With a Price/Forward Earnings ratio of 45.22, CECO can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, CECO is valued a bit more expensive than 68.94% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.57, CECO is valued quite expensively.

		Industry Rank	Sector Rank
PE	77.51
Fwd PE	45.22

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, CECO is valued a bit more expensive than the industry average as 74.24% of the companies are valued more cheaply.

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	39.33

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CECO does not grow enough to justify the current Price/Earnings ratio.
CECO's earnings are expected to grow with 42.16% in the coming years. This may justify a more expensive valuation.