TSX:AFN

Stock Analysis Report

Ag Growth International

Executive Summary

Ag Growth International Inc., together with its subsidiaries, manufactures and distributes grain handling, storage, and conditioning equipment in Canada, the United States, and internationally.

Snowflake

Fundamentals

Average dividend payer with acceptable track record.

Share Price & News

How has Ag Growth International's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-0.8%

AFN

-0.09%

CA Machinery

-0.2%

CA Market


1 Year Return

-33.0%

AFN

-24.3%

CA Machinery

1.1%

CA Market

Return vs Industry: AFN underperformed the Canadian Machinery industry which returned -24.3% over the past year.

Return vs Market: AFN underperformed the Canadian Market which returned 1.1% over the past year.


Shareholder returns

AFNIndustryMarket
7 Day-0.8%-0.09%-0.2%
30 Day-10.5%-5.5%-3.3%
90 Day-25.6%-13.6%-1.6%
1 Year-29.9%-33.0%-22.1%-24.3%4.6%1.1%
3 Year-2.6%-14.8%0.9%-5.6%13.1%3.1%
5 Year12.7%-12.1%23.6%14.2%24.7%6.7%

Price Volatility Vs. Market

How volatile is Ag Growth International's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Ag Growth International undervalued compared to its fair value and its price relative to the market?

30.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: AFN (CA$39.84) is trading below our estimate of fair value (CA$57.01)

Significantly Undervalued: AFN is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: AFN is poor value based on its PE Ratio (20.6x) compared to the Machinery industry average (18.3x).

PE vs Market: AFN is poor value based on its PE Ratio (20.6x) compared to the Canadian market (13.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: AFN is poor value based on its PEG Ratio (1.3x)


Price to Book Ratio

PB vs Industry: AFN is good value based on its PB Ratio (1.8x) compared to the CA Machinery industry average (2.2x).


Next Steps

Future Growth

How is Ag Growth International forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

15.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AFN's forecast earnings growth (15.6% per year) is above the savings rate (1.9%).

Earnings vs Market: AFN's earnings (15.6% per year) are forecast to grow faster than the Canadian market (13.6% per year).

High Growth Earnings: AFN's earnings are forecast to grow, but not significantly.

Revenue vs Market: AFN's revenue (5.7% per year) is forecast to grow slower than the Canadian market (5.7% per year).

High Growth Revenue: AFN's revenue (5.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: Insufficient data to determine if AFN's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Ag Growth International performed over the past 5 years?

35.5%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: AFN's earnings have grown significantly by 35.5% per year over the past 5 years.

Accelerating Growth: AFN's earnings growth over the past year (4.8%) is below its 5-year average (35.5% per year).

Earnings vs Industry: AFN earnings growth over the past year (4.8%) exceeded the Machinery industry -6.2%.


Return on Equity

High ROE: AFN's Return on Equity (8.4%) is considered low.


Return on Assets

ROA vs Industry: AFN's Return on Assets is below or equal to the Machinery industry average last year.


Return on Capital Employed

ROCE Improving: AFN has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Ag Growth International's financial position?


Financial Position Analysis

Short Term Liabilities: AFN's short term assets (CA$455.4M) exceeds its short term liabilities (CA$231.6M)

Long Term Liabilities: AFN's short term assets (455.4M) do not cover its long term liabilities (808.9M)


Debt to Equity History and Analysis

Debt Level: AFN's debt to equity ratio (180.4%) is considered high

Reducing Debt: AFN's debt to equity ratio has increased from 58.9% to 180.4% over the past 5 years.

Debt Coverage: AFN's debt is not well covered by operating cash flow (0.1%).

Interest Coverage: AFN's interest payments on its debt are not well covered by EBIT (2.5x coverage).


Balance Sheet

Inventory Level: AFN has a high level of physical assets or inventory.

Debt Coverage by Assets: AFN's debt is not covered by short term assets (assets are 0.6x debt).


Next Steps

Dividend

What is Ag Growth International's current dividend yield, its reliability and sustainability?

6.02%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Ag Growth International before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company6.0%marketbottom25%2.0%markettop25%6.0%industryaverage5.3%forecastin3Years6.0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: AFN's dividend (6.02%) is higher than the bottom 25% of dividend payers in the Canadian market (2.04%).

High Dividend: AFN's dividend (6.02%) is low compared to the top 25% of dividend payers in the Canadian market (6.03%).

Stable Dividend: AFN's dividends per share have been stable in the past 10 years.

Growing Dividend: AFN's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (123.9%), AFN's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AFN's dividends in 3 years are forecast to be covered by earnings (67.7% payout ratio).


Next Steps

Management

What is the CEO of Ag Growth International's salary, the management and board of directors tenure and is there insider trading?

3.8yrs

Average management tenure


CEO

Tim Close (45yo)

3.8yrs

Tenure

CA$1,983,537

Compensation

Mr. Tim Close, CFA has been the President and Chief Executive Officer of Ag Growth International Inc. since March 2, 2015 and January 1, 2016 respectively. Mr. Close served as Senior Vice President of Stra ...


CEO Compensation Analysis

Compensation vs. Market: Tim's total compensation ($USD1.51M) is about average for companies of similar size in the Canadian market ($USD1.08M).

Compensation vs Earnings: Tim's compensation has increased by more than 20% in the past year.


Management Age and Tenure

3.8yrs

Average Tenure

Experienced Management: AFN's management team is considered experienced (3.8 years average tenure).


Board Age and Tenure

9.7yrs

Average Tenure

63.5yo

Average Age

Experienced Board: AFN's board of directors are considered experienced (9.7 years average tenure).


Insider Trading

Insider Buying: AFN insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyCA$430,58214 Aug 19
Tim Close
EntityIndividual
Role
Chief Executive Officer
President
Shares9,903
Max PriceCA$43.48
SellCA$1,275,43606 Jul 19
Gary Anderson
EntityIndividual
Role
Member of the Board of Directors
Special Advisor & Director
Shares23,175
Max PriceCA$55.05
SellCA$1,677,60028 Jun 19
Gary Anderson
EntityIndividual
Role
Member of the Board of Directors
Special Advisor & Director
Shares30,000
Max PriceCA$55.92
BuyCA$300,44020 Dec 18
Gary Anderson
EntityIndividual
Role
Member of the Board of Directors
Special Advisor & Director
Shares6,475
Max PriceCA$46.40

Ownership Breakdown


Management Team

  • Steve Sommerfeld

    Executive VP

    • Tenure: 22.8yrs
    • Compensation: CA$1.41m
  • Gary Anderson (63yo)

    Special Advisor & Director

    • Tenure: 13.4yrs
    • Compensation: CA$145.27k
  • Ron Braun

    Senior Vice President of Farm

    • Tenure: 3.9yrs
    • Compensation: CA$337.50k
  • Dan Donner

    Senior Vice President of Commercial

    • Tenure: 3.9yrs
    • Compensation: CA$345.94k
  • Nicolle Parker

    Senior Vice President - Finance & Information Systems

    • Tenure: 0yrs
  • David Postill

    Vice President of Marketing

    • Tenure: 2.8yrs
    • Compensation: CA$703.80k
  • Craig Wilson

    Senior Vice President of Human Resources

    • Tenure: 2.6yrs
    • Compensation: CA$859.75k
  • Tim Close (45yo)

    President

    • Tenure: 3.8yrs
    • Compensation: CA$1.98m
  • Ryan Kipp

    Vice President of Legal & General Counsel

    • Tenure: 3.8yrs

Board Members

  • Mac Moore (69yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: CA$211.11k
  • Bill Lambert (67yo)

    Independent Chairman of the Board

    • Tenure: 12.8yrs
    • Compensation: CA$195.12k
  • Bill Maslechko (58yo)

    Independent Director

    • Tenure: 12.9yrs
    • Compensation: CA$204.68k
  • Gary Anderson (63yo)

    Special Advisor & Director

    • Tenure: 13.4yrs
    • Compensation: CA$145.27k
  • Anne De Greef-Safft (56yo)

    Independent Director

    • Tenure: 0.8yrs
    • Compensation: CA$12.73k
  • David White (66yo)

    Independent Director

    • Tenure: 12.9yrs
    • Compensation: CA$245.12k
  • Janet Giesselman (64yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: CA$237.07k
  • Tim Close (45yo)

    President

    • Tenure: 3.8yrs
    • Compensation: CA$1.98m

Company Information

Ag Growth International Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ag Growth International Inc.
  • Ticker: AFN
  • Exchange: TSX
  • Founded: 1996
  • Industry: Agricultural and Farm Machinery
  • Sector: Capital Goods
  • Market Cap: CA$743.221m
  • Shares outstanding: 18.66m
  • Website: https://www.aggrowth.com

Number of Employees


Location

  • Ag Growth International Inc.
  • 198 Commerce Drive
  • Winnipeg
  • Manitoba
  • R3P 0Z6
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AFNTSX (The Toronto Stock Exchange)YesCommon SharesCACADMay 2004
AGGZ.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDMay 2004
7AGDB (Deutsche Boerse AG)YesCommon SharesDEEURMay 2004

Biography

Ag Growth International Inc., together with its subsidiaries, manufactures and distributes grain handling, storage, and conditioning equipment in Canada, the United States, and internationally. The company ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/19 23:53
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.