TELUS INTERNATIONAL CDA INC (TIXT.CA) Stock Fundamental Analysis
TSX:TIXT - Toronto Stock Exchange - CA87975H1001 - Common Stock - Currency: CAD
Overall TIXT gets a fundamental rating of 4 out of 10. We evaluated TIXT against 13 industry peers in the IT Services industry. TIXT has a medium profitability rating, but doesn't score so well on its financial health evaluation. TIXT may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year TIXT was profitable.
TIXT had a positive operating cash flow in the past year.
Of the past 5 years TIXT 4 years were profitable.
TIXT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of -2.53%, TIXT is doing good in the industry, outperforming 69.23% of the companies in the same industry.
The Return On Equity of TIXT (-5.84%) is better than 76.92% of its industry peers.
Looking at the Return On Invested Capital, with a value of 1.19%, TIXT is in the better half of the industry, outperforming 76.92% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for TIXT is in line with the industry average of 5.99%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.53% | ||
| ROE | -5.84% | ||
| ROIC | 1.19% |
ROA(3y)1.64%
ROA(5y)1.96%
ROE(3y)3.16%
ROE(5y)4.69%
ROIC(3y)4.57%
ROIC(5y)4.61%
1.3 Margins
Looking at the Operating Margin, with a value of 2.28%, TIXT is in the better half of the industry, outperforming 76.92% of the companies in the same industry.
TIXT's Operating Margin has declined in the last couple of years.
TIXT has a better Gross Margin (80.64%) than 84.62% of its industry peers.
TIXT's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.28% | ||
| PM (TTM) | N/A | ||
| GM | 80.64% |
OM growth 3Y-27.26%
OM growth 5Y-20.91%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.3%
GM growth 5Y-0.39%
2. Health
2.1 Basic Checks
TIXT has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for TIXT has been increased compared to 1 year ago.
The number of shares outstanding for TIXT has been increased compared to 5 years ago.
The debt/assets ratio for TIXT has been reduced compared to a year ago.
2.2 Solvency
The Debt to FCF ratio of TIXT is 4.26, which is a neutral value as it means it would take TIXT, 4.26 years of fcf income to pay off all of its debts.
TIXT has a better Debt to FCF ratio (4.26) than 69.23% of its industry peers.
TIXT has a Debt/Equity ratio of 0.70. This is a neutral value indicating TIXT is somewhat dependend on debt financing.
TIXT has a Debt to Equity ratio of 0.70. This is in the better half of the industry: TIXT outperforms 61.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 4.26 | ||
| Altman-Z | N/A |
ROIC/WACC0.16
WACC7.5%
2.3 Liquidity
A Current Ratio of 0.86 indicates that TIXT may have some problems paying its short term obligations.
TIXT has a Current ratio of 0.86. This is in the lower half of the industry: TIXT underperforms 61.54% of its industry peers.
TIXT has a Quick Ratio of 0.86. This is a bad value and indicates that TIXT is not financially healthy enough and could expect problems in meeting its short term obligations.
TIXT has a worse Quick ratio (0.86) than 61.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.86 |
3. Growth
3.1 Past
The earnings per share for TIXT have decreased strongly by -72.09% in the last year.
TIXT shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -26.56% yearly.
TIXT shows a decrease in Revenue. In the last year, the revenue decreased by -0.30%.
Measured over the past years, TIXT shows a very strong growth in Revenue. The Revenue has been growing by 21.12% on average per year.
EPS 1Y (TTM)-72.09%
EPS 3Y-26.56%
EPS 5YN/A
EPS Q2Q%-72.73%
Revenue 1Y (TTM)-0.3%
Revenue growth 3Y6.6%
Revenue growth 5Y21.12%
Sales Q2Q%1.98%
3.2 Future
The Earnings Per Share is expected to grow by 13.06% on average over the next years. This is quite good.
Based on estimates for the next years, TIXT will show a quite strong growth in Revenue. The Revenue will grow by 13.57% on average per year.
EPS Next Y-18.55%
EPS Next 2Y4.79%
EPS Next 3Y13.06%
EPS Next 5YN/A
Revenue Next Year2.3%
Revenue Next 2Y2.95%
Revenue Next 3Y3.81%
Revenue Next 5Y13.57%
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 accelerating.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 11.85 indicates a reasonable valuation of TIXT.
Based on the Price/Earnings ratio, TIXT is valued cheaper than 92.31% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.25, TIXT is valued rather cheaply.
TIXT is valuated cheaply with a Price/Forward Earnings ratio of 6.44.
Based on the Price/Forward Earnings ratio, TIXT is valued cheaper than 100.00% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.15. TIXT is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.85 | ||
| Fwd PE | 6.44 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TIXT is valued cheaper than 92.31% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, TIXT is valued cheaply inside the industry as 100.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.24 | ||
| EV/EBITDA | 5.53 |
4.3 Compensation for Growth
A more expensive valuation may be justified as TIXT's earnings are expected to grow with 13.06% in the coming years.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y4.79%
EPS Next 3Y13.06%
5. Dividend
5.1 Amount
TIXT does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
TSX:TIXT (5/30/2025, 7:00:00 PM)
3.91
-0.02 (-0.51%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners49.39%
Inst Owner ChangeN/A
Ins Owners1.24%
Ins Owner ChangeN/A
Market Cap1.08B
Analysts48.75
Price Target7.16 (83.12%)
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)-17.78%
Min EPS beat(2)-47.72%
Max EPS beat(2)12.17%
EPS beat(4)2
Avg EPS beat(4)58.53%
Min EPS beat(4)-47.72%
Max EPS beat(4)289.04%
EPS beat(8)3
Avg EPS beat(8)30.43%
EPS beat(12)7
Avg EPS beat(12)21.57%
EPS beat(16)11
Avg EPS beat(16)18.39%
Revenue beat(2)2
Avg Revenue beat(2)0.84%
Min Revenue beat(2)0.72%
Max Revenue beat(2)0.97%
Revenue beat(4)2
Avg Revenue beat(4)-1.27%
Min Revenue beat(4)-6.5%
Max Revenue beat(4)0.97%
Revenue beat(8)2
Avg Revenue beat(8)-1.94%
Revenue beat(12)2
Avg Revenue beat(12)-3.09%
Revenue beat(16)2
Avg Revenue beat(16)-2.74%
PT rev (1m)0.19%
PT rev (3m)-29.4%
EPS NQ rev (1m)-12.26%
EPS NQ rev (3m)-19.65%
EPS NY rev (1m)0%
EPS NY rev (3m)-2.5%
Revenue NQ rev (1m)0.92%
Revenue NQ rev (3m)-0.4%
Revenue NY rev (1m)-0.11%
Revenue NY rev (3m)0.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.85 | ||
| Fwd PE | 6.44 | ||
| P/S | 0.29 | ||
| P/FCF | 2.24 | ||
| P/OCF | 1.7 | ||
| P/B | 0.4 | ||
| P/tB | N/A | ||
| EV/EBITDA | 5.53 |
EPS(TTM)0.33
EY8.44%
EPS(NY)0.61
Fwd EY15.53%
FCF(TTM)1.75
FCFY44.69%
OCF(TTM)2.3
OCFY58.74%
SpS13.34
BVpS9.75
TBVpS-6.75
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -2.53% | ||
| ROE | -5.84% | ||
| ROCE | 1.65% | ||
| ROIC | 1.19% | ||
| ROICexc | 1.24% | ||
| ROICexgc | 17.43% | ||
| OM | 2.28% | ||
| PM (TTM) | N/A | ||
| GM | 80.64% | ||
| FCFM | 13.1% |
ROA(3y)1.64%
ROA(5y)1.96%
ROE(3y)3.16%
ROE(5y)4.69%
ROIC(3y)4.57%
ROIC(5y)4.61%
ROICexc(3y)4.76%
ROICexc(5y)4.8%
ROICexgc(3y)33.38%
ROICexgc(5y)46.87%
ROCE(3y)6.35%
ROCE(5y)6.4%
ROICexcg growth 3Y-36.12%
ROICexcg growth 5Y-3.66%
ROICexc growth 3Y-29.52%
ROICexc growth 5Y-28.85%
OM growth 3Y-27.26%
OM growth 5Y-20.91%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.3%
GM growth 5Y-0.39%
F-Score4
Asset Turnover0.59
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 4.26 | ||
| Debt/EBITDA | 3.53 | ||
| Cap/Depr | 33.74% | ||
| Cap/Sales | 4.12% | ||
| Interest Coverage | 0.7 | ||
| Cash Conversion | 118.86% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.86 | ||
| Quick Ratio | 0.86 | ||
| Altman-Z | N/A |
F-Score4
WACC7.5%
ROIC/WACC0.16
Cap/Depr(3y)33.52%
Cap/Depr(5y)34.32%
Cap/Sales(3y)3.83%
Cap/Sales(5y)3.95%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-72.09%
EPS 3Y-26.56%
EPS 5YN/A
EPS Q2Q%-72.73%
EPS Next Y-18.55%
EPS Next 2Y4.79%
EPS Next 3Y13.06%
EPS Next 5YN/A
Revenue 1Y (TTM)-0.3%
Revenue growth 3Y6.6%
Revenue growth 5Y21.12%
Sales Q2Q%1.98%
Revenue Next Year2.3%
Revenue Next 2Y2.95%
Revenue Next 3Y3.81%
Revenue Next 5Y13.57%
EBIT growth 1Y-72.4%
EBIT growth 3Y-22.45%
EBIT growth 5Y-4.2%
EBIT Next Year378.91%
EBIT Next 3Y77.25%
EBIT Next 5Y72.45%
FCF growth 1Y18.64%
FCF growth 3Y24.79%
FCF growth 5Y35.89%
OCF growth 1Y17.05%
OCF growth 3Y18.46%
OCF growth 5Y29.56%