SOUTH BOW CORP (SOBO.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:SOBO - CA83671M1059 - Common Stock
38 CAD
-0.3 (-0.78%)
We assign a fundamental rating of 3 out of 10 to SOBO. SOBO was compared to 206 industry peers in the Oil, Gas & Consumable Fuels industry. SOBO has a medium profitability rating, but doesn't score so well on its financial health evaluation. SOBO has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- SOBO had positive earnings in the past year.
- SOBO had a positive operating cash flow in the past year.
1.2 Ratios
- SOBO has a better Return On Assets (2.91%) than 72.33% of its industry peers.
- With an excellent Return On Equity value of 12.71%, SOBO belongs to the best of the industry, outperforming 89.32% of the companies in the same industry.
- SOBO has a Return On Invested Capital of 5.63%. This is in the better half of the industry: SOBO outperforms 77.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.91% | ||
| ROE | 12.71% | ||
| ROIC | 5.63% |
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
- SOBO has a Profit Margin of 16.92%. This is in the better half of the industry: SOBO outperforms 78.64% of its industry peers.
- Looking at the Operating Margin, with a value of 36.12%, SOBO belongs to the top of the industry, outperforming 87.86% of the companies in the same industry.
- The Gross Margin of SOBO (44.55%) is better than 73.30% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.12% | ||
| PM (TTM) | 16.92% | ||
| GM | 44.55% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), SOBO is destroying value.
- Compared to 1 year ago, SOBO has more shares outstanding
- Compared to 1 year ago, SOBO has a worse debt to assets ratio.
2.2 Solvency
- SOBO has an Altman-Z score of 0.83. This is a bad value and indicates that SOBO is not financially healthy and even has some risk of bankruptcy.
- SOBO has a Altman-Z score of 0.83. This is comparable to the rest of the industry: SOBO outperforms 54.37% of its industry peers.
- The Debt to FCF ratio of SOBO is 16.23, which is on the high side as it means it would take SOBO, 16.23 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of SOBO (16.23) is better than 70.87% of its industry peers.
- A Debt/Equity ratio of 2.19 is on the high side and indicates that SOBO has dependencies on debt financing.
- SOBO has a worse Debt to Equity ratio (2.19) than 76.21% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.19 | ||
| Debt/FCF | 16.23 | ||
| Altman-Z | 0.83 |
ROIC/WACC0.75
WACC7.49%
2.3 Liquidity
- SOBO has a Current Ratio of 1.36. This is a normal value and indicates that SOBO is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 1.36, SOBO is in the better half of the industry, outperforming 70.87% of the companies in the same industry.
- A Quick Ratio of 1.28 indicates that SOBO should not have too much problems paying its short term obligations.
- SOBO's Quick ratio of 1.28 is fine compared to the rest of the industry. SOBO outperforms 72.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.28 |
3. Growth
3.1 Past
- The earnings per share for SOBO have decreased strongly by -28.51% in the last year.
- SOBO shows a small growth in Revenue. In the last year, the Revenue has grown by 5.74%.
EPS 1Y (TTM)-28.51%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%57.9%
Revenue 1Y (TTM)5.74%
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%-11.57%
3.2 Future
- The Earnings Per Share is expected to grow by 5.07% on average over the next years.
- Based on estimates for the next years, SOBO will show a decrease in Revenue. The Revenue will decrease by -0.09% on average per year.
EPS Next Y1.85%
EPS Next 2Y0.24%
EPS Next 3Y3.87%
EPS Next 5Y5.07%
Revenue Next Year-11.41%
Revenue Next 2Y-6.05%
Revenue Next 3Y-2.72%
Revenue Next 5Y-0.09%
3.3 Evolution
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 14.73 indicates a correct valuation of SOBO.
- Based on the Price/Earnings ratio, SOBO is valued a bit cheaper than 68.93% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.60, SOBO is valued a bit cheaper.
- A Price/Forward Earnings ratio of 16.06 indicates a correct valuation of SOBO.
- Based on the Price/Forward Earnings ratio, SOBO is valued a bit cheaper than 64.56% of the companies in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.83. SOBO is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.73 | ||
| Fwd PE | 16.06 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SOBO is on the same level as its industry peers.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of SOBO indicates a somewhat cheap valuation: SOBO is cheaper than 68.93% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.46 | ||
| EV/EBITDA | 11.45 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SOBO does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)7.96
PEG (5Y)N/A
EPS Next 2Y0.24%
EPS Next 3Y3.87%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 7.62%, SOBO is a good candidate for dividend investing.
- Compared to an average industry Dividend Yield of 3.29, SOBO pays a better dividend. On top of this SOBO pays more dividend than 96.12% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, SOBO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.62% |
5.2 History
- SOBO is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
DPN/A
EPS Next 2Y0.24%
EPS Next 3Y3.87%
SOUTH BOW CORP / SOBO.CA FAQ
Can you provide the ChartMill fundamental rating for SOUTH BOW CORP?
ChartMill assigns a fundamental rating of 3 / 10 to SOBO.CA.
Can you provide the valuation status for SOUTH BOW CORP?
ChartMill assigns a valuation rating of 4 / 10 to SOUTH BOW CORP (SOBO.CA). This can be considered as Fairly Valued.
What is the profitability of SOBO stock?
SOUTH BOW CORP (SOBO.CA) has a profitability rating of 4 / 10.
How financially healthy is SOUTH BOW CORP?
The financial health rating of SOUTH BOW CORP (SOBO.CA) is 3 / 10.
What is the earnings growth outlook for SOUTH BOW CORP?
The Earnings per Share (EPS) of SOUTH BOW CORP (SOBO.CA) is expected to grow by 1.85% in the next year.