ECN Capital (ECN) AI Stock Analysis

• Market Cap: C$835.99M
• Dividend Yield: 1.43%
• Average Volume (3M): 120.30K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.32
• Revenue Growth: 39.53%
• EPS Growth: 99.75%
• Country: CA
• Employees: 690
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 0.06
• Shares Outstanding: 281,479,000
• 10 Day Avg. Volume: 128,499
• 30 Day Avg. Volume: 120,297
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• 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$3.17
• Price Target Upside: 13.62% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 3

• Rating: 59 Neutral
• Price Target: C$3.00 ▲(7.53% Upside)

ECN Capital's overall stock score is driven by strong cash flow performance and positive earnings call sentiment, indicating growth potential. However, high leverage and concerning valuation metrics pose significant risks. Technical analysis shows limited momentum, suggesting the stock may face challenges in the near term.

Positive Factors

Strong Cash Flow Generation

Robust cash flow generation indicates strong operational efficiency and provides financial flexibility for future investments and debt management.

Record Originations in Triad

Record originations demonstrate successful market penetration and demand for ECN's financing solutions, supporting revenue growth.

Growth in Managed Assets

The growth in managed assets reflects ECN's ability to scale its operations and enhance its market position, contributing to long-term stability.

Negative Factors

High Leverage

Significant leverage poses financial risk, potentially limiting the company's ability to invest in growth opportunities and manage economic downturns.

RV & Marine Segment Challenges

Challenges in the RV & Marine segment could hinder overall profitability and require strategic adjustments to mitigate industry-specific risks.

Flat Commercial Growth

Stagnant commercial growth suggests potential market saturation or competitive pressures, necessitating innovation or diversification to drive future growth.

ECN Capital Business Overview & Revenue Model

Company Description

ECN Capital Corp. is a North American financial services company that provides a range of financial solutions primarily in the areas of equipment financing, commercial financing, and fleet management services. The company focuses on serving the needs of small to medium-sized businesses across various sectors, offering tailored lending solutions that facilitate growth and operational efficiency. ECN Capital operates through its subsidiaries, which include the Equipment Finance and Commercial Finance segments, and is committed to delivering innovative financing options to its clients.

How the Company Makes Money

ECN Capital generates revenue primarily through interest income on loans and leases provided to its clients. The company earns money by financing equipment and commercial loans, charging interest on the amounts financed. Additionally, ECN Capital may receive fees from clients for processing and managing these loans. The company's revenue model is bolstered by partnerships with various financial institutions and equipment manufacturers, which enhance its lending capabilities and expand its market reach. By focusing on a diversified portfolio of financing products and maintaining strong relationships with clients and partners, ECN Capital is able to create stable and recurring revenue streams.

ECN Capital Financial Statement Overview

Summary

ECN Capital shows a mixed financial performance. The income statement reflects growth and improving margins, while the balance sheet indicates high leverage, posing potential risks. The cash flow statement is a standout, showcasing strong cash generation and management. Overall, ECN Capital is on a positive trajectory but must manage its leverage to ensure long-term stability.

Income Statement

ECN Capital's income statement shows a positive trajectory with a TTM revenue growth rate of 8.85%, indicating a recovery from previous declines. The gross profit margin has improved to 47.47% in TTM, reflecting better cost management. However, the net profit margin remains modest at 6.37%, suggesting room for profitability improvements. The EBIT and EBITDA margins have also improved, indicating enhanced operational efficiency.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 2.87 in TTM, which poses a risk due to significant leverage. Return on equity is relatively low at 6.63%, indicating limited returns for shareholders. The equity ratio stands at 21.01%, reflecting a moderate level of equity financing. Overall, the balance sheet shows stability but highlights potential risks associated with high leverage.

Cash Flow

The cash flow statement is strong, with a significant free cash flow growth rate of 126.55% in TTM, indicating robust cash generation. The operating cash flow to net income ratio of 1.42 suggests efficient cash conversion. The free cash flow to net income ratio is nearly 1, demonstrating effective cash management. Overall, the cash flow position is a key strength for ECN Capital.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	214.89M	220.76M	159.32M	196.67M	215.37M	266.72M
Gross Profit	105.25M	88.15M	17.12M	90.81M	120.77M	167.44M
EBITDA	42.66M	32.19M	-40.84M	37.11M	-9.94M	22.68M
Net Income	7.57M	7.63M	-106.78M	15.89M	4.97M	15.82M
Balance Sheet
Total Assets	953.15M	937.15M	1.28B	1.41B	1.15B	1.71B
Cash, Cash Equivalents and Short-Term Investments	12.73M	15.46M	23.24M	12.71M	45.04M	37.98M
Total Debt	570.73M	590.94M	917.70M	1.01B	274.60M	531.79M
Total Liabilities	749.59M	726.25M	1.08B	1.22B	927.49M	883.64M
Stockholders Equity	200.27M	207.48M	209.49M	193.68M	218.63M	822.56M
Cash Flow
Free Cash Flow	174.34M	179.73M	-45.44M	-912.20M	131.76M	-80.27M
Operating Cash Flow	175.01M	180.86M	-26.03M	-869.27M	139.73M	-77.61M
Investing Cash Flow	-2.96M	147.75M	43.38M	116.25M	-79.83M	-3.19M
Financing Cash Flow	-181.29M	-334.89M	-6.79M	721.07M	-1.83B	35.14M

ECN Capital Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.79
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ECN, the sentiment is Negative. The current price of 2.79 is below the 20-day moving average (MA) of 2.86, below the 50-day MA of 2.90, and below the 200-day MA of 2.88, indicating a bearish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 40.17 is Neutral, neither overbought nor oversold. The STOCH value of 10.87 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ECN.

ECN Capital Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MKP	―	C$861.09M	11.62	11.84%	7.55%	12.10%	-18.24%
GCG	―	C$1.64B	10.60	11.80%	2.73%	96.56%	158.06%
Sector *	―	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
GSY	―	$2.71B	9.93	23.77%	3.29%	14.61%	8.17%
ECN	―	C$835.99M	-3,712.50	3.80%	1.43%	39.53%	99.75%
CF	―	$1.21B	-18.27	-5.32%	2.89%	14.43%	-584.17%
DLCG	―	C$813.32M	-4.43	-143.13%	1.27%	35.22%	-1246.65%

ECN Capital Corporate Events

ECN Capital’s Earnings Call: Growth Amid Challenges

ECN Capital’s recent earnings call painted a picture of robust growth and strategic success, tempered by challenges in specific segments. The company celebrated significant achievements in originations and asset growth, alongside successful upgrade strategies and strong financial performance. However, it also acknowledged hurdles in the RV & Marine segment and origination revenue margins that require attention.

ECN Capital Reports Strong Q2 2025 Results Amid Strategic Upgrades

ECN Capital reported a solid financial performance for Q2 2025, with an adjusted net income of $0.04 per share, driven by growth in its Manufactured Housing Financing segment. Despite facing challenges in the RV and Marine Financing segment, the company is implementing strategic upgrades to improve sales and profitability. The company’s originations and managed assets have shown significant growth, reflecting its strong market positioning. ECN Capital has adjusted its financial guidance for the year and declared dividends for its shareholders.

The most recent analyst rating on (TSE:ECN) stock is a Hold with a C$2.35 price target. To see the full list of analyst forecasts on ECN Capital stock, see the TSE:ECN Stock Forecast page.

ECN Capital Reports Solid Q2 2025 Results with Strategic Upgrades

ECN Capital Corp. reported a solid financial performance for Q2 2025, with an adjusted net income of $0.04 per share, showing growth compared to previous periods. The company is enhancing its business operations, particularly in the Manufactured Housing Financing segment, while addressing challenges in the RV and Marine Financing segment. The company has adjusted its financial guidance for 2025, reflecting strategic upgrades and market conditions.

The most recent analyst rating on (TSE:ECN) stock is a Hold with a C$2.35 price target. To see the full list of analyst forecasts on ECN Capital stock, see the TSE:ECN Stock Forecast page.