Canada's ATS Q2 revenue falls 8.6%, misses estimates
Overview
Canada automation solutions provider's Q2 revenue fell 8.6% yr/yr, missing analyst expectations
Adjusted EPS missed analyst expectations
Company repurchased C$61.3 mln in shares under NCIB
Outlook
ATS expects Q3 fiscal 2027 revenues of C$640 mln to C$680 mln
Company no longer expects modest revenue growth or 50-75 bps margin expansion in fiscal 2027
ATS expects recent US tariff modifications to benefit future order activity and customer capex plans
Result Drivers
LOWER ORGANIC REVENUE - Co said revenue decline was mainly due to lower organic revenue and reduced construction contract activity
MIXED END-MARKET PERFORMANCE - Co cited lower life sciences, industrial & consumer, and food & beverage revenues due to timing of customer projects and lower backlog
ORDER DELAYS AND TARIFFS - Co said delays in non-life sciences order bookings were worsened by US tariffs on Canadian packaging equipment
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue | Miss | C$665.80 mln | C$681.59 mln (7 Analysts) |
Q2 Adjusted EPS | Miss | C$0.27 | C$0.33 (7 Analysts) |
Q2 Net Loss | C$5 mln | ||
Q2 Loss Per Basic Share | C$0.05 | ||
Q2 Order Backlog | C$2.009 bln | ||
Q2 Orders | C$827 mln |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 1 "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 Corporation is C$41.00, about 54.7% above its November 3 closing price of C$26.50
The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 19 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)