Is ATS’s Return to Profitability Shifting the Growth Narrative for ATS (TSX:ATS)?

• ATS Corporation reported strong fiscal second-quarter results in early November 2025, with sales rising to CA$728.46 million and net income reaching CA$33.68 million after a year-ago loss; the company also provided revenue guidance for the next quarter and updated shareholders on its buyback program.
• ATS's return to profitability on robust sales growth marks a significant turnaround from its net loss a year earlier, highlighting successful execution and improved operational performance.
• We'll explore how ATS's move from a loss to meaningful profitability could influence the company's growth outlook and margin expectations.

AI is about to change healthcare. These 32 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10b in market cap - there's still time to get in early.

ATS Investment Narrative Recap

ATS appeals to shareholders who believe in automation growth and rising demand for advanced manufacturing solutions, and the company’s profitable quarter offers reassurance about execution. However, this positive result does not materially reduce the near-term risk associated with the company’s dependence on acquisitions for sustained revenue expansion or allay concerns about margin impact should M&A slow down.

The most relevant company update is ATS’s Q3 revenue guidance of CA$700 million to CA$740 million, which comes alongside news of profitable operations. This provides investors with short-term visibility into sales trends but leaves larger questions about the sustainability of organic growth unresolved as broader order bookings have softened in certain segments.

By contrast, investors should be aware of potential volatility if ATS’s pipeline of integration-ready acquisitions slows or fails to deliver immediate…

Read the full narrative on ATS (it's free!)

ATS' narrative projects CA$3.5 billion revenue and CA$580.2 million earnings by 2028. This requires 10.5% yearly revenue growth and a CA$619.4 million increase in earnings from CA$-39.2 million.

Uncover how ATS' forecasts yield a CA$47.80 fair value, a 24% upside to its current price.

Exploring Other Perspectives

The Simply Wall St Community’s four fair value estimates for ATS range from CA$34.40 to CA$48.62, showing opinions can differ by over CA$14. With acquisitions contributing more to growth than organic sales this quarter, you may want to explore a variety of perspectives on how this shapes ATS’s future performance.

Explore 4 other fair value estimates on ATS - why the stock might be worth as much as 26% more than the current price!

Build Your Own ATS Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your ATS research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free ATS research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate ATS' overall financial health at a glance.

No Opportunity In ATS?

These stocks are moving-our analysis flagged them today. Act fast before the price catches up:

• Rare earth metals are an input to most high-tech devices, military and defence systems and electric vehicles. The global race is on to secure supply of these critical minerals. Beat the pack to uncover the 37 best rare earth metal stocks of the very few that mine this essential strategic resource.
• We've found 16 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.
• Explore 28 top quantum computing companies leading the revolution in next-gen technology and shaping the future with breakthroughs in quantum algorithms, superconducting qubits, and cutting-edge research.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com