ATS Corporation (ATS) AI Stock Analysis

• Market Cap: C$3.44B
• Dividend Yield: N/A
• Average Volume (3M): 244.23K
• Price to Earnings (P/E): 38.6
• Beta (1Y): 1.19
• Revenue Growth: -7.46%
• EPS Growth: -49.87%
• Country: CA
• Employees: 7,500
• Sector: Industrials
• Sector Strength: 78
• Industry: Industrial - Machinery
• EPS (TTM): 0.32
• Shares Outstanding: 97,928,314
• 10 Day Avg. Volume: 127,038
• 30 Day Avg. Volume: 244,230
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$51.00
• Price Target Upside: 45.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

ATS Corporation demonstrates robust revenue growth and a strong order backlog, particularly in life sciences and food & beverage sectors. However, challenges such as a declining revenue trend, cash flow issues, and high valuation relative to earnings suggest caution. Technical indicators signal bearish momentum, and while strategic initiatives offer long-term promise, short-term risks like tariff impacts and transportation segment challenges cannot be overlooked. The stock is positioned for potential recovery with strategic execution and improved cash management.

ATS Corporation Business Overview & Revenue Model

Company Description

ATS Corporation, together with its subsidiaries, provides automation solutions worldwide. The company is also involved in the planning, designing, building, commissioning, and servicing automated manufacturing and assembly systems, including automation products and test solutions. It offers enterprise solutions in the areas of project management; partners/suppliers/vendors team selection and coordination; facility layouts and operational design; business case development and project justification; post project service, spare parts, and support; and system design, built, integration, commissioning, validation, training and start up. In addition, the company offers pre-automation services comprising discovery and analysis, concept development, simulation, and total cost of ownership modelling; post automation services, including training, process optimization, preventative maintenance, emergency and on-call support, spare parts, retooling, retrofits, and equipment relocation; and contract manufacturing services. Further, it provides engineering design, prototyping, process verification, specification writing, software and manufacturing process controls development, standard automation products/platforms, equipment design and build, third-party equipment qualification, procurement and integration, automation system installation, product line commissioning, validation, and documentation services. The company serves life sciences, transportation, consumer products, food and beverage, and energy markets. The company was formerly known as ATS Automation Tooling Systems Inc. and changed its name to ATS Corporation in November 2022. ATS Corporation was founded in 1978 and is headquartered in Cambridge, Canada.

How the Company Makes Money

ATS Corporation generates revenue through the sale of its automation systems and related services. Key revenue streams include the design, development, and installation of custom automation solutions tailored to specific industry applications. Additionally, ATS offers ongoing maintenance and support services, as well as retrofitting and upgrading existing systems to improve performance. The company also engages in strategic partnerships and collaborations with technology providers and industry leaders to enhance its offerings and expand market reach. These partnerships, along with a focus on innovation and customer satisfaction, contribute significantly to ATS's earnings.

ATS Corporation Financial Statement Overview

Summary

ATS Corporation demonstrates strong revenue growth and profitability margins, reflecting robust market positioning. However, moderate leverage and cash flow challenges highlight potential risks. Addressing cash flow issues is critical for long-term sustainability.

Income Statement

ATS Corporation's TTM revenue is $2.75 billion with a gross profit margin of 28.06%, indicating strong profitability in the industrial goods sector. However, the net profit margin has decreased to 3.24%, showing pressure on net income. Revenue demonstrated growth over the past years, with a notable increase from $2.18 billion in 2022 to $3.03 billion in 2024. The EBIT margin is 7.61%, and the EBITDA margin is 12.87%, both showing a healthy capacity to generate operating earnings.

Balance Sheet

The debt-to-equity ratio is 0.99, reflecting a balanced capital structure but with room for improvement. The return on equity (ROE) is 5.09%, indicating moderate efficiency in generating profits from shareholders' equity. The equity ratio is 37.55%, showing a stable financial base. The increase in total assets and stockholders' equity over time indicates growth and investment potential.

Cash Flow

The company experienced negative free cash flow in the TTM, primarily due to significant capital expenditures. The operating cash flow is negative, which could be a concern for liquidity and operational sustainability. The free cash flow to net income ratio is negative, indicating potential challenges in converting net income into usable cash.

Breakdown
Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement		Total Revenue
3.03B	2.58B	2.18B	1.43B	1.43B
	Gross Profit
855.50M	725.81M	612.43M	384.26M	362.13M
	EBIT
315.39M	222.49M	186.61M	119.61M	95.61M
	EBITDA
458.54M	349.94M	302.54M	192.15M	169.08M
	Net Income Common Stockholders
193.74M	127.43M	122.10M	64.09M	52.90M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
170.18M	159.87M	135.28M	187.47M	358.64M
	Total Assets
4.09B	3.54B	3.07B	2.20B	2.10B
	Total Debt
1.29B	1.26B	1.10B	504.78M	665.58M
	Net Debt
1.12B	1.10B	966.01M	317.31M	306.93M
	Total Liabilities
2.40B	2.41B	2.08B	1.28B	1.23B
	Stockholders Equity
1.68B	1.13B	981.60M	895.26M	868.23M
Cash Flow		Free Cash Flow
-67.68M	47.50M	162.90M	153.59M	-36.22M
	Operating Cash Flow
20.78M	127.80M	216.16M	185.16M	20.35M
	Investing Cash Flow
-341.98M	-109.02M	-797.47M	-88.13M	-109.80M
	Financing Cash Flow
330.92M	4.88M	531.53M	-259.12M	222.31M

ATS Corporation Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 35.09
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ATS, the sentiment is Neutral. The current price of 35.09 is above the 20-day moving average (MA) of 33.99, below the 50-day MA of 37.00, and below the 200-day MA of 39.67, indicating a neutral trend. The MACD of -0.41 indicates Negative momentum. The RSI at 49.16 is Neutral, neither overbought nor oversold. The STOCH value of 77.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:ATS.

ATS Corporation Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SIS	75 Outperform	C$1.27B	26.11	8.63%	2.96%	3.68%	19.78%
Sector *	64 Neutral	$4.27B	11.80	5.31%	249.79%	4.07%	-9.02%
ATS	63 Neutral	C$3.44B	38.59	5.30%	―	-7.46%	-49.87%
VLN	62 Neutral	C$351.84M	―	-33.87%	0.19%	7.64%	-2.26%
REKO	49 Neutral	C$20.47M	―	-8.95%	―	-15.53%	-824.56%
PYR	42 Neutral	C$80.27M	―	-5701.32%	―	26.79%	76.97%

ATS Corporation Corporate Events

ATS Corporation to Engage with Investors at RBC Capital Markets Conference

ATS Corporation announced that its Chief Financial Officer, Ryan McLeod, will participate in the RBC Capital Markets Canadian Industrials Conference in Toronto on May 15, 2025. This participation underscores ATS’s commitment to engaging with institutional investors and highlights its strategic positioning in the industrial automation sector.

Spark’s Take on TSE:ATS Stock

According to Spark, TipRanks’ AI Analyst, TSE:ATS is a Neutral.

ATS Corporation’s overall score reflects strong revenue growth and profitability, offset by cash flow challenges and a high P/E ratio. While technical indicators suggest bearish trends, the robust order backlog and strategic focus on high-value sectors like life sciences could bolster future performance. Potential short-term risks include revenue declines and tariff impacts.

To see Spark’s full report on TSE:ATS stock, click here.

ATS Corporation to Engage at J.P. Morgan Industrials Conference

ATS Corporation announced the participation of its CEO and CFO in the upcoming J.P. Morgan Industrials Conference in New York City on March 11, 2025. The event will feature a fireside chat, and the company will host institutional investor meetings, which highlights ATS’s commitment to engaging with investors and stakeholders, potentially strengthening its market position and visibility.

ATS Corporation Faces Revenue Decline but Achieves Record Order Bookings

ATS Corporation reported a decrease in its third-quarter fiscal 2025 results, with revenues dropping to $652.0 million, and a significant decline in net income to $6.5 million. Despite the lower revenues attributed to reduced market demand in the North American EV market, the company experienced strong growth in order bookings, reaching a second-highest record in company history, driven by strong performance in the life sciences and food and beverage sectors. The CEO highlighted the robust order backlog, which supports future revenue visibility and value creation for stakeholders.