COVALON TECHNOLOGIES LTD (COV.CA) Stock Fundamental Analysis
Canada - TSX Venture Exchange - TSX-V:COV - CA22282D3022 - Common Stock
1.68 CAD
+0.01 (+0.6%)
Overall COV gets a fundamental rating of 6 out of 10. We evaluated COV against 23 industry peers in the Biotechnology industry. COV has an excellent financial health rating, but there are some minor concerns on its profitability. COV may be a bit undervalued, certainly considering the very reasonable score on growth With these ratings, COV could be worth investigating further for value investing!.
1. Profitability
1.1 Basic Checks
- In the past year COV was profitable.
- COV had a positive operating cash flow in the past year.
- The reported net income has been mixed in the past 5 years: COV reported negative net income in multiple years.
- In multiple years COV reported negative operating cash flow during the last 5 years.
1.2 Ratios
- With an excellent Return On Assets value of 5.70%, COV belongs to the best of the industry, outperforming 95.65% of the companies in the same industry.
- COV has a Return On Equity of 6.70%. This is amongst the best in the industry. COV outperforms 95.65% of its industry peers.
- COV has a Return On Invested Capital of 3.92%. This is amongst the best in the industry. COV outperforms 95.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.7% | ||
| ROE | 6.7% | ||
| ROIC | 3.92% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- With an excellent Profit Margin value of 6.27%, COV belongs to the best of the industry, outperforming 95.65% of the companies in the same industry.
- The Operating Margin of COV (5.37%) is better than 95.65% of its industry peers.
- COV has a Gross Margin of 53.24%. This is amongst the best in the industry. COV outperforms 86.96% of its industry peers.
- In the last couple of years the Gross Margin of COV has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.37% | ||
| PM (TTM) | 6.27% | ||
| GM | 53.24% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y8.84%
GM growth 5Y9.13%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), COV is destroying value.
- There is no outstanding debt for COV. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
- An Altman-Z score of 5.85 indicates that COV is not in any danger for bankruptcy at the moment.
- With an excellent Altman-Z score value of 5.85, COV belongs to the best of the industry, outperforming 91.30% of the companies in the same industry.
- COV has a debt to FCF ratio of 1.56. This is a very positive value and a sign of high solvency as it would only need 1.56 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 1.56, COV belongs to the top of the industry, outperforming 91.30% of the companies in the same industry.
- A Debt/Equity ratio of 0.05 indicates that COV is not too dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.05, COV is in the better half of the industry, outperforming 65.22% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.05 | ||
| Debt/FCF | 1.56 | ||
| Altman-Z | 5.85 |
ROIC/WACC0.49
WACC7.99%
2.3 Liquidity
- COV has a Current Ratio of 8.36. This indicates that COV is financially healthy and has no problem in meeting its short term obligations.
- With an excellent Current ratio value of 8.36, COV belongs to the best of the industry, outperforming 86.96% of the companies in the same industry.
- COV has a Quick Ratio of 6.40. This indicates that COV is financially healthy and has no problem in meeting its short term obligations.
- With an excellent Quick ratio value of 6.40, COV belongs to the best of the industry, outperforming 91.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 8.36 | ||
| Quick Ratio | 6.4 |
3. Growth
3.1 Past
- The earnings per share for COV have decreased strongly by -29.70% in the last year.
- The Revenue has been growing slightly by 5.29% in the past year.
- COV shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 19.43% yearly.
EPS 1Y (TTM)-29.7%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-50%
Revenue 1Y (TTM)5.29%
Revenue growth 3Y21.83%
Revenue growth 5Y19.43%
Sales Q2Q%-1.98%
3.2 Future
- COV is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 27.61% yearly.
- The Revenue is expected to grow by 6.79% on average over the next years.
EPS Next Y76.57%
EPS Next 2Y43.53%
EPS Next 3Y35.75%
EPS Next 5Y27.61%
Revenue Next Year6.67%
Revenue Next 2Y6.81%
Revenue Next 3Y6.78%
Revenue Next 5Y6.79%
3.3 Evolution
- 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.
4. Valuation
4.1 Price/Earnings Ratio
- COV is valuated rather expensively with a Price/Earnings ratio of 24.00.
- COV's Price/Earnings ratio is rather cheap when compared to the industry. COV is cheaper than 95.65% of the companies in the same industry.
- COV is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.25, which is the current average of the S&P500 Index.
- COV is valuated correctly with a Price/Forward Earnings ratio of 13.59.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of COV indicates a rather cheap valuation: COV is cheaper than 86.96% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. COV is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24 | ||
| Fwd PE | 13.59 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, COV is valued cheaper than 95.65% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, COV is valued cheaper than 91.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.17 | ||
| EV/EBITDA | 11.51 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The decent profitability rating of COV may justify a higher PE ratio.
- COV's earnings are expected to grow with 35.75% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.31
PEG (5Y)N/A
EPS Next 2Y43.53%
EPS Next 3Y35.75%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 8.93%, COV is a good candidate for dividend investing.
- In the last 3 months the price of COV has falen by -22.94%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
- COV's Dividend Yield is rather good when compared to the industry average which is at 0.49. COV pays more dividend than 100.00% of the companies in the same industry.
- COV's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.93% |
5.2 History
- COV does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y43.53%
EPS Next 3Y35.75%
COVALON TECHNOLOGIES LTD / COV.CA FAQ
Can you provide the ChartMill fundamental rating for COVALON TECHNOLOGIES LTD?
ChartMill assigns a fundamental rating of 6 / 10 to COV.CA.
What is the valuation status for COV stock?
ChartMill assigns a valuation rating of 8 / 10 to COVALON TECHNOLOGIES LTD (COV.CA). This can be considered as Undervalued.
Can you provide the profitability details for COVALON TECHNOLOGIES LTD?
COVALON TECHNOLOGIES LTD (COV.CA) has a profitability rating of 6 / 10.
What is the financial health of COVALON TECHNOLOGIES LTD (COV.CA) stock?
The financial health rating of COVALON TECHNOLOGIES LTD (COV.CA) is 8 / 10.