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 12 industry peers in the IT Services industry. There are concerns on the financial health of TIXT while its profitability can be described as average. TIXT has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year TIXT was profitable.
TIXT had a positive operating cash flow in the past year.
TIXT had positive earnings in 4 of the past 5 years.
Each year in the past 5 years TIXT had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of -2.53%, TIXT is doing good in the industry, outperforming 66.67% of the companies in the same industry.
With a decent Return On Equity value of -5.84%, TIXT is doing good in the industry, outperforming 66.67% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 1.19%, TIXT is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
TIXT had an Average Return On Invested Capital over the past 3 years of 4.57%. This is significantly below the industry average of 45.49%.
| 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
The Operating Margin of TIXT (2.28%) is better than 66.67% of its industry peers.
TIXT's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 80.64%, TIXT belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
In the last couple of years the Gross Margin of TIXT has remained more or less at the same level.
| 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), TIXT 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.
Compared to 1 year ago, TIXT has an improved debt to assets ratio.
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.
The Debt to FCF ratio of TIXT (4.26) is better than 66.67% 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 (0.70) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 4.26 | ||
| Altman-Z | N/A |
ROIC/WACC0.17
WACC7.15%
2.3 Liquidity
TIXT has a Current 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.
The Current ratio of TIXT (0.86) is worse than 66.67% of its industry peers.
A Quick Ratio of 0.86 indicates that TIXT may have some problems paying its short term obligations.
TIXT has a worse Quick ratio (0.86) than 66.67% 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 -83.53% 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.
The Revenue has decreased by -1.85% in the past year.
The Revenue has been growing by 21.12% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-83.53%
EPS 3Y-26.56%
EPS 5YN/A
EPS Q2Q%-62.5%
Revenue 1Y (TTM)-1.85%
Revenue growth 3Y6.6%
Revenue growth 5Y21.12%
Sales Q2Q%7.21%
3.2 Future
Based on estimates for the next years, TIXT will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.06% on average per year.
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 Year2.97%
Revenue Next 2Y3.15%
Revenue Next 3Y3.77%
Revenue Next 5Y13.57%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 26.68, the valuation of TIXT can be described as expensive.
Based on the Price/Earnings ratio, TIXT is valued cheaper than 91.67% of the companies in the same industry.
TIXT is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.82, which is the current average of the S&P500 Index.
TIXT is valuated reasonably with a Price/Forward Earnings ratio of 8.32.
Based on the Price/Forward Earnings ratio, TIXT is valued cheaper than 100.00% of the companies in the same industry.
TIXT's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 36.21.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.68 | ||
| Fwd PE | 8.32 |
4.2 Price Multiples
91.67% of the companies in the same industry are more expensive than TIXT, based on the Enterprise Value to EBITDA ratio.
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 | 2.91 | ||
| EV/EBITDA | 6.13 |
4.3 Compensation for Growth
TIXT's earnings are expected to grow with 13.06% in the coming years. This may justify a more expensive valuation.
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 (8/1/2025, 7:00:00 PM)
5.07
-0.16 (-3.06%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners45.17%
Inst Owner ChangeN/A
Ins Owners1.59%
Ins Owner ChangeN/A
Market Cap1.41B
Analysts72.31
Price Target3.71 (-26.82%)
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)-18.04%
PT rev (3m)-48.09%
EPS NQ rev (1m)7.61%
EPS NQ rev (3m)-7%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0.25%
Revenue NQ rev (3m)1.32%
Revenue NY rev (1m)0.65%
Revenue NY rev (3m)0.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.68 | ||
| Fwd PE | 8.32 | ||
| P/S | 0.38 | ||
| P/FCF | 2.91 | ||
| P/OCF | 2.21 | ||
| P/B | 0.52 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.13 |
EPS(TTM)0.19
EY3.75%
EPS(NY)0.61
Fwd EY12.02%
FCF(TTM)1.74
FCFY34.39%
OCF(TTM)2.29
OCFY45.2%
SpS13.31
BVpS9.72
TBVpS-6.74
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
WACC7.15%
ROIC/WACC0.17
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)-83.53%
EPS 3Y-26.56%
EPS 5YN/A
EPS Q2Q%-62.5%
EPS Next Y-18.55%
EPS Next 2Y4.79%
EPS Next 3Y13.06%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.85%
Revenue growth 3Y6.6%
Revenue growth 5Y21.12%
Sales Q2Q%7.21%
Revenue Next Year2.97%
Revenue Next 2Y3.15%
Revenue Next 3Y3.77%
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%