Tricon Residential Inc (TCN.CA) Stock Fundamental Analysis
TSX:TCN - Toronto Stock Exchange - CA89612W1023 - Common Stock - Currency: CAD
We assign a fundamental rating of 4 out of 10 to TCN. TCN was compared to 27 industry peers in the Real Estate Management & Development industry. TCN has a medium profitability rating, but doesn't score so well on its financial health evaluation. TCN is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year TCN was profitable.
In the past year TCN had a positive cash flow from operations.
In the past 5 years TCN has always been profitable.
Of the past 5 years TCN 4 years had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 0.86%, TCN is doing good in the industry, outperforming 70.59% of the companies in the same industry.
With a decent Return On Equity value of 2.96%, TCN is doing good in the industry, outperforming 73.53% of the companies in the same industry.
With a Return On Invested Capital value of 1.64%, TCN is not doing good in the industry: 67.65% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.86% | ||
| ROE | 2.96% | ||
| ROIC | 1.64% |
ROA(3y)4.08%
ROA(5y)3.73%
ROE(3y)12.96%
ROE(5y)10.43%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
With an excellent Profit Margin value of 13.44%, TCN belongs to the best of the industry, outperforming 85.29% of the companies in the same industry.
TCN's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 29.82%, TCN is doing good in the industry, outperforming 67.65% of the companies in the same industry.
In the last couple of years the Operating Margin of TCN has declined.
The Gross Margin of TCN (69.17%) is better than 88.24% of its industry peers.
In the last couple of years the Gross Margin of TCN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.82% | ||
| PM (TTM) | 13.44% | ||
| GM | 69.17% |
OM growth 3Y-5.22%
OM growth 5YN/A
PM growth 3Y-21.94%
PM growth 5Y-54.81%
GM growth 3Y-0.28%
GM growth 5YN/A
2. Health
2.1 Basic Checks
TCN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, TCN has about the same amount of shares outstanding.
TCN has more shares outstanding than it did 5 years ago.
The debt/assets ratio for TCN has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.49, we must say that TCN is in the distress zone and has some risk of bankruptcy.
TCN has a Altman-Z score of 0.49. This is in the lower half of the industry: TCN underperforms 79.41% of its industry peers.
TCN has a debt to FCF ratio of 65.95. This is a negative value and a sign of low solvency as TCN would need 65.95 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 65.95, TCN is doing good in the industry, outperforming 64.71% of the companies in the same industry.
TCN has a Debt/Equity ratio of 1.48. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of TCN (1.48) is worse than 61.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.48 | ||
| Debt/FCF | 65.95 | ||
| Altman-Z | 0.49 |
ROIC/WACC0.22
WACC7.57%
2.3 Liquidity
A Current Ratio of 0.49 indicates that TCN may have some problems paying its short term obligations.
TCN's Current ratio of 0.49 is on the low side compared to the rest of the industry. TCN is outperformed by 61.76% of its industry peers.
TCN has a Quick Ratio of 0.49. This is a bad value and indicates that TCN is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.49, TCN is not doing good in the industry: 61.76% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.49 | ||
| Quick Ratio | 0.49 |
3. Growth
3.1 Past
The earnings per share for TCN have decreased strongly by -66.47% in the last year.
Measured over the past years, TCN shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -17.03% on average per year.
Looking at the last year, TCN shows a small growth in Revenue. The Revenue has grown by 5.48% in the last year.
Measured over the past years, TCN shows a very strong growth in Revenue. The Revenue has been growing by 94.79% on average per year.
EPS 1Y (TTM)-66.47%
EPS 3Y4.46%
EPS 5Y-17.03%
EPS Q2Q%36.36%
Revenue 1Y (TTM)5.48%
Revenue growth 3Y28.44%
Revenue growth 5Y94.79%
Sales Q2Q%15.69%
3.2 Future
Based on estimates for the next years, TCN will show a very negative growth in Earnings Per Share. The EPS will decrease by -15.81% on average per year.
TCN is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.50% yearly.
EPS Next Y-48.61%
EPS Next 2Y-15.81%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year6.66%
Revenue Next 2Y8.5%
Revenue Next 3YN/A
Revenue Next 5YN/A
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 stable.
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
TCN is valuated rather expensively with a Price/Earnings ratio of 19.67.
TCN's Price/Earnings ratio is a bit cheaper when compared to the industry. TCN is cheaper than 79.41% of the companies in the same industry.
TCN is valuated rather cheaply when we compare the Price/Earnings ratio to 27.50, which is the current average of the S&P500 Index.
TCN is valuated quite expensively with a Price/Forward Earnings ratio of 38.28.
Based on the Price/Forward Earnings ratio, TCN is valued a bit cheaper than the industry average as 70.59% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.44, TCN is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.67 | ||
| Fwd PE | 38.28 |
4.2 Price Multiples
TCN's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, TCN is valued a bit cheaper than the industry average as 73.53% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.33 | ||
| EV/EBITDA | 33.91 |
4.3 Compensation for Growth
TCN's earnings are expected to decrease with -15.81% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-15.81%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.99%, TCN has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.37, TCN pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.35, TCN has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
5.2 History
On average, the dividend of TCN grows each year by 19.89%, which is quite nice.
TCN has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)19.89%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
84.00% of the earnings are spent on dividend by TCN. This is not a sustainable payout ratio.
TCN's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP84%
EPS Next 2Y-15.81%
EPS Next 3YN/A
TSX:TCN (5/2/2024, 7:00:00 PM)
15.34
-0.12 (-0.78%)
Chartmill FA Rating
GICS SectorReal Estate
GICS IndustryGroupEquity Real Estate Investment Trusts (REITs)
GICS IndustryReal Estate Management & Development
Earnings (Last)
Earnings (Next)
Inst Owners36.51%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap4.55B
Analysts71.11
Price Target12.26 (-20.08%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
Yearly Dividend0.35
Dividend Growth(5Y)19.89%
DP84%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)172.28%
Min EPS beat(2)147.53%
Max EPS beat(2)197.03%
EPS beat(4)3
Avg EPS beat(4)110.4%
Min EPS beat(4)-0.99%
Max EPS beat(4)197.03%
EPS beat(8)7
Avg EPS beat(8)235.95%
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)2
Avg Revenue beat(2)85.19%
Min Revenue beat(2)79.44%
Max Revenue beat(2)90.95%
Revenue beat(4)4
Avg Revenue beat(4)80.48%
Min Revenue beat(4)72.02%
Max Revenue beat(4)90.95%
Revenue beat(8)8
Avg Revenue beat(8)71.53%
Revenue beat(12)11
Avg Revenue beat(12)50.84%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-5.26%
PT rev (3m)4.25%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.67 | ||
| Fwd PE | 38.28 | ||
| P/S | 3.92 | ||
| P/FCF | 36.33 | ||
| P/OCF | 24.11 | ||
| P/B | 0.86 | ||
| P/tB | 0.87 | ||
| EV/EBITDA | 33.91 |
EPS(TTM)0.78
EY5.08%
EPS(NY)0.4
Fwd EY2.61%
FCF(TTM)0.42
FCFY2.75%
OCF(TTM)0.64
OCFY4.15%
SpS3.92
BVpS17.81
TBVpS17.65
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.86% | ||
| ROE | 2.96% | ||
| ROCE | 2% | ||
| ROIC | 1.64% | ||
| ROICexc | 1.67% | ||
| ROICexgc | 1.67% | ||
| OM | 29.82% | ||
| PM (TTM) | 13.44% | ||
| GM | 69.17% | ||
| FCFM | 10.78% |
ROA(3y)4.08%
ROA(5y)3.73%
ROE(3y)12.96%
ROE(5y)10.43%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y-1.7%
ROICexcg growth 5YN/A
ROICexc growth 3Y-1.2%
ROICexc growth 5YN/A
OM growth 3Y-5.22%
OM growth 5YN/A
PM growth 3Y-21.94%
PM growth 5Y-54.81%
GM growth 3Y-0.28%
GM growth 5YN/A
F-Score5
Asset Turnover0.06
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.48 | ||
| Debt/FCF | 65.95 | ||
| Debt/EBITDA | 21.13 | ||
| Cap/Depr | 261.04% | ||
| Cap/Sales | 5.47% | ||
| Interest Coverage | 0.87 | ||
| Cash Conversion | 50.9% | ||
| Profit Quality | 80.17% | ||
| Current Ratio | 0.49 | ||
| Quick Ratio | 0.49 | ||
| Altman-Z | 0.49 |
F-Score5
WACC7.57%
ROIC/WACC0.22
Cap/Depr(3y)254.57%
Cap/Depr(5y)208.56%
Cap/Sales(3y)5.52%
Cap/Sales(5y)8.97%
Profit Quality(3y)42.83%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-66.47%
EPS 3Y4.46%
EPS 5Y-17.03%
EPS Q2Q%36.36%
EPS Next Y-48.61%
EPS Next 2Y-15.81%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)5.48%
Revenue growth 3Y28.44%
Revenue growth 5Y94.79%
Sales Q2Q%15.69%
Revenue Next Year6.66%
Revenue Next 2Y8.5%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y152.14%
EBIT growth 3Y21.74%
EBIT growth 5YN/A
EBIT Next Year27.82%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-60.91%
FCF growth 3Y-11.02%
FCF growth 5YN/A
OCF growth 1Y-48.93%
OCF growth 3Y-1.17%
OCF growth 5YN/A