Automation company ATS Corp's Q1 revenue beats estimates, profit drops on higher costs
Overview
ATS Corp fiscal Q1 revenue rises 6.1% yr/yr, beating analyst expectations
Net income and adjusted EPS decline due to higher SG&A and finance costs
CEO Andrew Hider steps down, CFO Ryan McLeod named interim CEO
Outlook
ATS expects Q2 revenues between C$700 mln and C$740 mln
Company sees strong funnel activity in life sciences and energy
ATS notes inflationary pressures may disrupt margin expansion
Company anticipates opportunities in nuclear refurbishment projects
Result Drivers
ACQUISITIONS - Revenue growth driven by contributions from recent acquisitions and positive foreign exchange impact
HIGHER COSTS - Net income decline attributed to increased SG&A, stock-based compensation, and finance costs
ORDER DECLINE - 15.2% decrease in order bookings mainly due to reduced EV production investments
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q1 Revenue | Beat | C$736.70 mln | C$712.90 mln (7 Analysts) |
Q1 Net Income | C$24.30 mln | ||
Q1 Basic EPS | C$0.25 | ||
Q1 Order Backlog | C$2.07 bln | ||
Q1 Orders | C$693 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the industrial machinery & equipment peer group is "buy"
Wall Street's median 12-month price target for ATS Corp is C$49.00, about 12.9% above its August 6 closing price of C$42.68
The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 17 three months ago
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