Toromont Industries (TIH) AI Stock Analysis

• Market Cap: C$9.77B
• Dividend Yield: 1.73%
• Average Volume (3M): 154.81K
• Price to Earnings (P/E): 19.8
• Beta (1Y): 0.67
• Revenue Growth: 10.93%
• EPS Growth: -3.34%
• Country: CA
• Employees: 7,300
• Sector: Industrials
• Sector Strength: 83
• Industry: Industrial - Distribution
• EPS (TTM): 0.91
• Shares Outstanding: 81,262,764
• 10 Day Avg. Volume: 128,780
• 30 Day Avg. Volume: 154,807
• PEG Ratio: -11.47
• Price to Book (P/B): 3.10
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 95.26
• 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$127.14
• Price Target Upside: 5.70% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 78 Outperform
• Price Target: C$132.00 ▲(9.74%Upside)

Toromont Industries maintains strong financial health with effective cost management and a robust equity base. Despite challenges in net income and bookings, strategic moves like the AVL acquisition and financial initiatives such as the note offering and dividend increase bolster its position. The stock's technical indicators suggest a stable outlook with potential for moderate growth, while its valuation remains competitive within the industry.

Positive Factors

Dividends

The quarterly dividend was increased 8% to $0.52/sh.

Financial Performance

Financial performance was better-than-expected in Q4/24, supporting organic and M&A growth to deliver EPS growth.

Revenue Growth

CIMCO appears to be gaining momentum with revenues increasing 23% y/y due to stronger packages revenue.

Negative Factors

Trade Tariffs

The potential for tariffs between the US and Canada is an overhang and could impact customer capex decisions.

Toromont Industries Business Overview & Revenue Model

Company Description

Toromont Industries Ltd. provides specialized capital equipment in Canada, the United States, and internationally. It operates in two segments, Equipment Group and CIMCO. The Equipment Group segment engages in the sale, rental, and service of mobile equipment for Caterpillar and other manufacturers; sale, rental, and service of engines used in various applications, including industrial, commercial, marine, on-highway trucks, and power generation; and sale of complementary and related products, parts, and services. This segment serves building, mining, aggregates, public infrastructure, residential construction, power generation, marine, agriculture, forestry, on-highway truck engines, industrial, demolition, and waste management markets. The CIMCO segment is involved in the design, engineering, fabrication, installation, and after-sale support of refrigeration systems in industrial and recreational markets. This segment primarily serves beverage and food processing, cold storage, food distribution, mining, and recreational ice rink sectors. Toromont Industries Ltd. was founded in 1961 and is based in Concord, Canada.

How the Company Makes Money

Toromont Industries makes money through a combination of equipment sales, rentals, product support services, and refrigeration system solutions. The Equipment Group generates revenue by selling and renting heavy machinery and power systems, primarily representing Caterpillar products. This segment also provides comprehensive after-sales support, including maintenance, repairs, and parts supply, creating a recurring revenue stream. The CIMCO segment contributes to the company's earnings by offering custom-designed refrigeration systems for industrial and recreational applications, which include installation, maintenance, and repair services. Key factors contributing to Toromont's revenue include robust customer relationships, a wide range of high-quality product offerings, and strategic partnerships with leading equipment manufacturers.

Toromont Industries Financial Statement Overview

Summary

Toromont Industries exhibits strong financial health with consistent revenue growth and effective cost management. Despite a slight decrease in net income, the company maintains a healthy balance sheet with low leverage and strong cash flow management, although free cash flow has recently declined.

Income Statement

Toromont Industries has shown consistent revenue growth over the years, with a 20.5% increase from 2020 to 2024. The gross profit margin remains strong at 24.5% for TTM (Trailing-Twelve-Months). EBIT and EBITDA margins are robust at 13.0% and 18.0%, respectively, indicating effective cost management and operational efficiency. However, a slight decrease in net income from the previous year suggests potential challenges in maintaining profitability.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.33, reflecting low leverage. Return on equity is satisfactory at 16.7% for TTM, displaying effective utilization of equity. The equity ratio is strong at 57.4%, indicating a stable financial structure. However, a notable increase in total debt could pose future financial risks if not managed properly.

Cash Flow

Toromont Industries demonstrates strong cash flow management, with operating cash flow exceeding net income, indicating solid cash generation capabilities. Free cash flow saw a significant decline by 56.6% from the previous year, which could impact future investments and dividend policies. The free cash flow to net income ratio remains healthy, suggesting sustainable operations.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
5.09B	5.02B	4.62B	4.23B	3.89B	3.48B
	Gross Profit
1.25B	1.26B	1.24B	1.13B	969.77M	835.75M
	EBIT
664.57M	670.17M	704.23M	624.17M	475.94M	372.43M
	EBITDA
915.94M	928.78M	932.65M	802.97M	643.32M	547.82M
	Net Income Common Stockholders
497.03M	506.52M	534.71M	454.20M	332.71M	254.91M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
977.46M	890.82M	1.04B	927.78M	916.83M	591.13M
	Total Assets
5.18B	4.87B	4.57B	4.18B	3.58B	3.35B
	Total Debt
992.06M	689.72M	682.06M	663.22M	658.12M	662.86M
	Net Debt
14.60M	-201.10M	-358.69M	-264.56M	-258.71M	71.74M
	Total Liabilities
2.20B	1.91B	1.89B	1.86B	1.63B	1.65B
	Stockholders Equity
2.97B	2.96B	2.68B	2.33B	1.95B	1.70B
Cash Flow		Free Cash Flow
96.77M	222.71M	241.32M	147.62M	471.52M	305.74M
	Operating Cash Flow
336.09M	359.23M	355.79M	216.95M	542.72M	349.03M
	Investing Cash Flow
-325.99M	-206.80M	-78.12M	-44.33M	-68.87M	-32.55M
	Financing Cash Flow
-16.84M	-303.54M	-164.49M	-162.16M	-148.14M	-90.88M

Toromont Industries Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 120.28
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TIH, the sentiment is Neutral. The current price of 120.28 is above the 20-day moving average (MA) of 119.34, above the 50-day MA of 115.92, and above the 200-day MA of 117.85, indicating a neutral trend. The MACD of 1.35 indicates Positive momentum. The RSI at 51.21 is Neutral, neither overbought nor oversold. The STOCH value of 44.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:TIH.

Toromont Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TIH	78 Outperform	C$9.77B	19.80	17.36%	1.73%	10.93%	-3.34%
FTT	77 Outperform	C$7.43B	15.50	18.79%	2.19%	6.61%	1.87%
RUS	76 Outperform	$2.40B	16.10	9.30%	4.06%	-0.13%	-33.06%
WJX	73 Outperform	C$498.51M	12.16	8.09%	6.08%	-2.65%	-47.65%
BBD.A	69 Neutral	C$10.38B	27.62	-23.10%	―	16.31%	4.12%
Sector *	66 Neutral	$4.46B	12.15	5.40%	4.71%	4.16%	-11.97%
ARE	55 Neutral	C$1.21B	―	-9.26%	3.96%	1.70%	-154.73%

Toromont Industries Corporate Events

Toromont Industries Elects Board of Directors at Annual Meeting

Toromont Industries Ltd. announced the election of its Board of Directors at the Annual General Meeting of Shareholders, with all nominees from the Management Information Circular being elected. This election reinforces the company’s governance structure, potentially impacting its strategic direction and stakeholder confidence.

Toromont Industries Reports Q1 2025 Financial Results with Revenue Growth Amid Market Challenges

Toromont Industries Ltd. reported a 7% increase in revenue for the first quarter of 2025, reaching $1.1 billion, despite challenges in the market. However, net earnings and operating income saw declines of 11% and 8%, respectively, due to a less favorable sales mix and lower interest income. The Equipment Group experienced growth in new equipment sales and rentals, although used equipment sales and product support revenue were down. CIMCO also showed revenue growth, but overall bookings decreased by 12% due to economic uncertainty affecting customer decisions. The company’s backlog remains healthy at $1.3 billion, although slightly down from the previous year.

Toromont Industries to Announce Q1 2025 Results and Host Annual Meeting

Toromont Industries Ltd. is set to release its first quarter 2025 financial results on April 30, 2025, followed by an annual general meeting of shareholders on May 1, 2025. The announcement will be accompanied by a teleconference and webcast, providing an opportunity for analysts and stakeholders to engage with the company’s leadership. This event is significant for stakeholders as it offers insights into the company’s financial performance and strategic direction.

Toromont Industries Announces Cdn$300 Million Private Offering

Toromont Industries announced a private offering of Cdn$300 million in senior unsecured notes due in 2030, with a 3.76% interest rate. The proceeds will be used to repay debt and for general corporate purposes, highlighting the company’s strategic financial management and potential impact on its market positioning.