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ADENTRA
(TSX:ADEN)
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Rating:68Neutral
Price Target:
C$38.00
â–²(5.64% Upside)
Action:Downgraded
Date:08/10/26
The score is driven primarily by steady financial quality supported by cash generation and manageable (improving) leverage, though tempered by a sharp TTM revenue decline and lower profitability versus prior peak years. Technicals are constructive with the stock above key moving averages and positive MACD, while valuation is favorable at a low P/E with a modest dividend. The latest earnings call reinforced cautious but positive execution (pricing, margin, EPS growth) alongside ongoing volume and tariff-related risks.
Positive Factors
Cash Generation
Strong cash conversion provides internal funding for operations, investment, acquisitions and shareholder returns. Free cash flow tracking earnings indicates that reported profitability is supported by cash generation, although working-capital swings can still affect the timing and consistency of that support.
Negative Factors
Revenue Contraction
The sharp TTM revenue decline indicates that end-market demand and sales volumes remain a material challenge for the distributor. Prolonged contraction can reduce operating leverage, limit purchasing scale and make it harder for revenue growth to support earnings and investment.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Strong cash conversion provides internal funding for operations, investment, acquisitions and shareholder returns. Free cash flow tracking earnings indicates that reported profitability is supported by cash generation, although working-capital swings can still affect the timing and consistency of that support.
Read all positive factors
ADENTRA (ADEN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$859.02M
Dividend Yield1.78%
Average Volume (3M)43.37K
Price to Earnings (P/E)9.1
Beta (1Y)1.34
Revenue Growth0.83%
EPS Growth54.74%
CountryCA
Employees2,940
SectorIndustrials
Sector Strength72
IndustryIndustrial - Distribution
Share Statistics
EPS (TTM)2.80
Shares Outstanding24,245,497
10 Day Avg. Volume29,798
30 Day Avg. Volume43,369
Financial Highlights & Ratios
PEG Ratio0.27
Price to Book (P/B)1.25
Price to Sales (P/S)0.37
P/FCF Ratio5.59
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$48.75Price Target Upside35.53% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)2.64
Revenue Forecast (FY)C$2.31B
ADENTRA Business Overview & Revenue Model
Company Description
ADENTRA Inc. engages in the wholesale distribution of architectural building products to the residential, repair and remodel, and commercial construction markets in Canada and the United States. It offers doors, decorative surfaces, mouldings, sta...
How the Company Makes Money
ADENTRA makes money primarily by purchasing building materials from manufacturers and other suppliers and reselling those products to customers at a markup through its distribution network. Its core revenue stream is product sales across building-...
ADENTRA Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 11, 2026
Earnings Call Sentiment Positive
The call highlighted multiple financial and operational positives: revenue growth driven by pricing, gross margin expansion, positive operating leverage, mid-single-digit adjusted EBITDA growth, double-digit adjusted EPS growth, a strong balance sheet (2.5x leverage), active capital returns and an accretive tuck-in acquisition. Key risks discussed include persistent macro uncertainty, a modest volume decline, a dynamic tariff environment (and a nonrecurring $7.5M tariff recovery), seasonal working capital build and potential margin variability. On balance the company emphasized durable execution, strategic investments in digital and supply-chain diversification, and financial flexibility to pursue M&A, which collectively outweigh the near-term demand and trade-related headwinds.Positive Updates
Sales Growth and Pricing
Sales increased 1.7% year-over-year to $607.1M in Q2, driven by a 2.9% improvement in pricing that more than offset a 1.2% decline in sales volumes; management described this as low single-digit organic growth in a soft demand environment.
Negative Updates
Soft End-Market Demand and Volume Pressure
Underlying demand remains below historic levels; sales volumes declined 1.2% in the quarter and management remains cautious on near-term demand with macro uncertainty persisting.
Read all updates
Q2-2026 Updates
Positive
Negative
Sales Growth and Pricing
Sales increased 1.7% year-over-year to $607.1M in Q2, driven by a 2.9% improvement in pricing that more than offset a 1.2% decline in sales volumes; management described this as low single-digit organic growth in a soft demand environment.
Read all positive updates
Company Guidance
The company gave cautious near‑term guidance rather than formal numeric targets, emphasizing disciplined execution on pricing, costs, purchasing and inventory while advancing AI/digital initiatives, supply‑chain diversification and M&A: they reiterated low single‑digit organic growth in a soft market (Q2 sales were $607.1M, +1.7% year‑over‑year), noted pricing up 2.9% offsetting volume down 1.2%, gross margin of 22% (≈+20 bps), adjusted EBITDA of $57.7M (+6.2%) and a 9.5% adjusted EBITDA margin (+40 bps), adjusted basic EPS $0.98 (+11.4%), H1 sales $1.17B (+2.6%, volumes +0.6%), operating cash flow before working capital $55.7M, leverage 2.5x and ~$5.6M returned to shareholders in the quarter; they completed the tuck‑in Mount Storm deal (~$20M annualized sales, immediately accretive with synergies realized over 4–6 quarters), plan $50–150M of annual acquisition investment, have e‑commerce representing ~20% of sales, and flagged that ~30% of U.S. sales are imported subject to tariffs (roughly 10–12.5%), all while stressing balance‑sheet flexibility to invest, return capital and pursue disciplined, accretive transactions.ADENTRA Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
62
Positive
Cash Flow
64
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.27B | 2.29B | 2.18B | 2.97B | 3.47B | 2.06B |
| Gross Profit | 447.57M | 419.14M | 474.06M | 617.81M | 748.07M | 475.27M |
| EBITDA | 185.79M | 191.30M | 169.82M | 214.54M | 461.33M | 231.08M |
| Net Income | 67.67M | 69.63M | 46.48M | 47.78M | 172.88M | 131.46M |
Balance Sheet | ||||||
| Total Assets | 1.47B | 1.37B | 1.40B | 1.63B | 1.92B | 1.42B |
| Cash, Cash Equivalents and Short-Term Investments | 4.55M | 12.99M | 33.74M | 17.24M | 88.10M | 9.82M |
| Total Debt | 613.55M | 573.89M | 623.07M | 747.62M | 1.06B | 727.21M |
| Total Liabilities | 782.72M | 701.68M | 763.08M | 934.81M | 1.24B | 893.28M |
| Stockholders Equity | 686.99M | 668.80M | 634.57M | 698.36M | 686.41M | 527.68M |
Cash Flow | ||||||
| Free Cash Flow | 146.55M | 149.86M | 133.54M | 299.96M | 268.56M | -92.89M |
| Operating Cash Flow | 158.76M | 163.45M | 142.75M | 327.98M | 283.09M | -83.37M |
| Investing Cash Flow | -2.47M | -6.70M | -147.46M | -18.20M | -375.51M | -387.74M |
| Financing Cash Flow | -151.63M | -176.72M | 30.00M | -386.00M | 172.80M | 479.07M |
ADENTRA Technical Analysis
Positive
35.97
Price Trends
36.32
Negative
35.23
Positive
35.24
Positive
Market Momentum
-0.42
Positive
46.27
Neutral
59.06
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ADEN, the sentiment is Positive. The current price of 35.97 is above the 20-day moving average (MA) of 35.96, below the 50-day MA of 36.32, and above the 200-day MA of 35.24, indicating a neutral trend. The MACD of -0.42 indicates Positive momentum. The RSI at 46.27 is Neutral, neither overbought nor oversold. The STOCH value of 59.06 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ADEN.
ADENTRA Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | C$4.16B | 19.40 | 13.09% | 2.29% | 18.28% | 35.28% | |
70 Outperform | C$646.70M | 9.89 | 12.07% | 4.69% | -4.10% | 82.03% | |
69 Neutral | C$908.72M | 5.30 | 17.13% | 3.71% | 13.11% | 69.49% | |
69 Neutral | C$956.29M | 11.22 | 12.64% | 5.15% | 1.80% | 13.21% | |
68 Neutral | C$859.02M | 9.14 | 10.11% | 1.78% | 0.83% | 54.74% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
57 Neutral | C$391.30M | 13.46 | 9.04% | 98.67% | -5.27% | -37.28% |
* Industrials Sector Average
TSE:ADEN
ADENTRA
35.43
0.33
0.94%
TSE:ALC
Algoma Central
22.40
6.19
38.16%
TSE:DBM
Doman Building Materials Group
10.88
1.64
17.76%
TSE:TBL
Taiga Building Prod
3.63
0.06
1.54%
TSE:WJX
Wajax Corporation
29.86
7.24
31.98%
TSE:RUS
Russel Metals
75.85
35.88
89.77%
ADENTRA Corporate Events
Business Operations and StrategyFinancial DisclosuresM&A Transactions
ADENTRA Delivers Margin Gains and EPS Growth in Soft Q2 Market
Positive
Aug 5, 2026
ADENTRA reported solid second-quarter 2026 results, posting 1.7% sales growth to $607.1 million and expanding gross margin to 22.0% despite soft market conditions. Adjusted EBITDA rose 6.2%, adjusted EPS increased 11.4%, and normalized operating e...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.