STEP ENERGY SERVICES LTD (STEP.CA) Stock Fundamental Analysis
TSX:STEP - Toronto Stock Exchange - CA85859H1055 - Common Stock - Currency: CAD
Taking everything into account, STEP scores 4 out of 10 in our fundamental rating. STEP was compared to 27 industry peers in the Energy Equipment & Services industry. The financial health of STEP is average, but there are quite some concerns on its profitability. STEP has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year STEP was profitable.
In the past year STEP had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: STEP reported negative net income in multiple years.
In the past 5 years STEP always reported a positive cash flow from operatings.
1.2 Ratios
STEP has a worse Return On Assets (-2.17%) than 88.89% of its industry peers.
STEP has a worse Return On Equity (-3.93%) than 85.19% of its industry peers.
STEP has a Return On Invested Capital of 6.08%. This is in the lower half of the industry: STEP underperforms 66.67% of its industry peers.
STEP had an Average Return On Invested Capital over the past 3 years of 11.56%. This is in line with the industry average of 10.68%.
The last Return On Invested Capital (6.08%) for STEP is well below the 3 year average (11.56%), which needs to be investigated, but indicates that STEP had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.17% | ||
| ROE | -3.93% | ||
| ROIC | 6.08% |
ROA(3y)7.5%
ROA(5y)-1.64%
ROE(3y)15.21%
ROE(5y)-5.71%
ROIC(3y)11.56%
ROIC(5y)N/A
1.3 Margins
STEP has a Operating Margin of 4.68%. This is in the lower half of the industry: STEP underperforms 70.37% of its industry peers.
With a Gross Margin value of 9.38%, STEP is not doing good in the industry: 81.48% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of STEP has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.68% | ||
| PM (TTM) | N/A | ||
| GM | 9.38% |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y75.97%
GM growth 5Y63.02%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so STEP is still creating some value.
The number of shares outstanding for STEP has been reduced compared to 1 year ago.
STEP has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, STEP has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.06 indicates that STEP is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of STEP (2.06) is better than 62.96% of its industry peers.
STEP has a debt to FCF ratio of 2.80. This is a good value and a sign of high solvency as STEP would need 2.80 years to pay back of all of its debts.
STEP has a better Debt to FCF ratio (2.80) than 70.37% of its industry peers.
A Debt/Equity ratio of 0.26 indicates that STEP is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.26, STEP is doing good in the industry, outperforming 62.96% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.26 | ||
| Debt/FCF | 2.8 | ||
| Altman-Z | 2.06 |
ROIC/WACC0.68
WACC8.92%
2.3 Liquidity
STEP has a Current Ratio of 1.55. This is a normal value and indicates that STEP is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.55, STEP perfoms like the industry average, outperforming 48.15% of the companies in the same industry.
A Quick Ratio of 1.32 indicates that STEP should not have too much problems paying its short term obligations.
The Quick ratio of STEP (1.32) is better than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.32 |
3. Growth
3.1 Past
The earnings per share for STEP have decreased strongly by -83.51% in the last year.
STEP shows a decrease in Revenue. In the last year, the revenue decreased by -5.98%.
Measured over the past years, STEP shows a small growth in Revenue. The Revenue has been growing by 7.40% on average per year.
EPS 1Y (TTM)-83.51%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-40%
Revenue 1Y (TTM)-5.98%
Revenue growth 3Y21.21%
Revenue growth 5Y7.4%
Sales Q2Q%-3.87%
3.2 Future
STEP is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 26.83% yearly.
Based on estimates for the next years, STEP will show a decrease in Revenue. The Revenue will decrease by -3.79% on average per year.
EPS Next Y52.55%
EPS Next 2Y37.07%
EPS Next 3Y26.83%
EPS Next 5YN/A
Revenue Next Year-7.74%
Revenue Next 2Y-3.51%
Revenue Next 3Y-2.9%
Revenue Next 5Y-3.79%
3.3 Evolution
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
STEP is valuated quite expensively with a Price/Earnings ratio of 27.63.
Compared to the rest of the industry, the Price/Earnings ratio of STEP indicates a slightly more expensive valuation: STEP is more expensive than 70.37% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.29. STEP is around the same levels.
A Price/Forward Earnings ratio of 6.19 indicates a rather cheap valuation of STEP.
Based on the Price/Forward Earnings ratio, STEP is valued a bit cheaper than 74.07% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.74, STEP is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.63 | ||
| Fwd PE | 6.19 |
4.2 Price Multiples
88.89% of the companies in the same industry are more expensive than STEP, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, STEP is valued a bit cheaper than 62.96% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.92 | ||
| EV/EBITDA | 3.1 |
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.
STEP's earnings are expected to grow with 26.83% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.53
PEG (5Y)N/A
EPS Next 2Y37.07%
EPS Next 3Y26.83%
5. Dividend
5.1 Amount
No dividends for STEP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
TSX:STEP (7/4/2025, 7:00:00 PM)
4.42
+0.18 (+4.37%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)
Earnings (Next)
Inst Owners16.68%
Inst Owner ChangeN/A
Ins Owners1.44%
Ins Owner ChangeN/A
Market Cap318.15M
Analysts76.92
Price Target5.03 (13.8%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.97%
Min EPS beat(2)-7.56%
Max EPS beat(2)17.5%
EPS beat(4)2
Avg EPS beat(4)-33.51%
Min EPS beat(4)-144.39%
Max EPS beat(4)17.5%
EPS beat(8)4
Avg EPS beat(8)-51.13%
EPS beat(12)7
Avg EPS beat(12)-20.89%
EPS beat(16)10
Avg EPS beat(16)-22.6%
Revenue beat(2)1
Avg Revenue beat(2)6.41%
Min Revenue beat(2)-4.42%
Max Revenue beat(2)17.23%
Revenue beat(4)2
Avg Revenue beat(4)2.78%
Min Revenue beat(4)-4.42%
Max Revenue beat(4)17.23%
Revenue beat(8)3
Avg Revenue beat(8)0.72%
Revenue beat(12)4
Avg Revenue beat(12)-0.41%
Revenue beat(16)7
Avg Revenue beat(16)0.57%
PT rev (1m)0%
PT rev (3m)-4.83%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-7.93%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.87%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)5.21%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-4.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.63 | ||
| Fwd PE | 6.19 | ||
| P/S | 0.34 | ||
| P/FCF | 7.92 | ||
| P/OCF | 2.65 | ||
| P/B | 0.81 | ||
| P/tB | 0.81 | ||
| EV/EBITDA | 3.1 |
EPS(TTM)0.16
EY3.62%
EPS(NY)0.71
Fwd EY16.15%
FCF(TTM)0.56
FCFY12.63%
OCF(TTM)1.67
OCFY37.77%
SpS13.09
BVpS5.46
TBVpS5.44
PEG (NY)0.53
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.17% | ||
| ROE | -3.93% | ||
| ROCE | 8.44% | ||
| ROIC | 6.08% | ||
| ROICexc | 6.1% | ||
| ROICexgc | 6.11% | ||
| OM | 4.68% | ||
| PM (TTM) | N/A | ||
| GM | 9.38% | ||
| FCFM | 4.26% |
ROA(3y)7.5%
ROA(5y)-1.64%
ROE(3y)15.21%
ROE(5y)-5.71%
ROIC(3y)11.56%
ROIC(5y)N/A
ROICexc(3y)11.63%
ROICexc(5y)N/A
ROICexgc(3y)11.64%
ROICexgc(5y)N/A
ROCE(3y)16.05%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y75.97%
GM growth 5Y63.02%
F-Score6
Asset Turnover1.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.26 | ||
| Debt/FCF | 2.8 | ||
| Debt/EBITDA | 0.75 | ||
| Cap/Depr | 84.71% | ||
| Cap/Sales | 8.48% | ||
| Interest Coverage | 4.73 | ||
| Cash Conversion | 86.74% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.55 | ||
| Quick Ratio | 1.32 | ||
| Altman-Z | 2.06 |
F-Score6
WACC8.92%
ROIC/WACC0.68
Cap/Depr(3y)106.24%
Cap/Depr(5y)77.9%
Cap/Sales(3y)9.8%
Cap/Sales(5y)8.23%
Profit Quality(3y)1036.34%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-83.51%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%-40%
EPS Next Y52.55%
EPS Next 2Y37.07%
EPS Next 3Y26.83%
EPS Next 5YN/A
Revenue 1Y (TTM)-5.98%
Revenue growth 3Y21.21%
Revenue growth 5Y7.4%
Sales Q2Q%-3.87%
Revenue Next Year-7.74%
Revenue Next 2Y-3.51%
Revenue Next 3Y-2.9%
Revenue Next 5Y-3.79%
EBIT growth 1Y-58.45%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year104.61%
EBIT Next 3Y28.74%
EBIT Next 5Y14.58%
FCF growth 1Y-54.35%
FCF growth 3Y33.78%
FCF growth 5Y19.89%
OCF growth 1Y-35.15%
OCF growth 3Y35.4%
OCF growth 5Y15.87%