TSX:CAE

Stock Analysis Report

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Executive Summary

CAE Inc., together with its subsidiaries, provides training solutions for the civil aviation, defence and security, and healthcare markets worldwide. More Details


Snowflake Analysis

Fair value with moderate growth potential.


Similar Companies

Share Price & News

How has CAE's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CAE has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-5.2%

CAE

-5.3%

CA Aerospace & Defense

-8.4%

CA Market


1 Year Return

-32.3%

CAE

-35.5%

CA Aerospace & Defense

-60.8%

CA Market

Return vs Industry: CAE exceeded the Canadian Aerospace & Defense industry which returned -35.6% over the past year.

Return vs Market: CAE exceeded the Canadian Market which returned -60.7% over the past year.


Shareholder returns

CAEIndustryMarket
7 Day-5.2%-5.3%-8.4%
30 Day11.9%9.0%-3.0%
90 Day13.9%11.0%-26.8%
1 Year-31.8%-32.3%-34.9%-35.5%-59.2%-60.8%
3 Year2.1%-1.4%-11.9%-15.3%-60.5%-64.6%
5 Year62.1%51.1%30.6%21.5%-51.9%-59.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is CAE undervalued compared to its fair value and its price relative to the market?

31.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CAE (CA$22.77) is trading below our estimate of fair value (CA$33.18)

Significantly Below Fair Value: CAE is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: CAE is poor value based on its PE Ratio (43.5x) compared to the XN Aerospace & Defense industry average (20.1x).

PE vs Market: CAE is poor value based on its PE Ratio (43.5x) compared to the Canadian market (15.5x).


Price to Earnings Growth Ratio

PEG Ratio: CAE is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: CAE's PB Ratio (2.7x) is in line with the CA Aerospace & Defense industry average.


Next Steps

Future Growth

How is CAE forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

57.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CAE's forecast earnings growth (57% per year) is above the savings rate (1.7%).

Earnings vs Market: CAE's earnings (57% per year) are forecast to grow slower than the Canadian market (60.1% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: CAE's revenue (9% per year) is forecast to grow faster than the Canadian market (7.3% per year).

High Growth Revenue: CAE's revenue (9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CAE's Return on Equity is forecast to be low in 3 years time (11%).


Next Steps

Past Performance

How has CAE performed over the past 5 years?

6.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CAE has a large one-off loss of CA$134.2M impacting its June 30 2020 financial results.

Growing Profit Margin: CAE's current net profit margins (4.2%) are lower than last year (9.5%).


Past Earnings Growth Analysis

Earnings Trend: CAE's earnings have grown by 6.1% per year over the past 5 years.

Accelerating Growth: CAE's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: CAE had negative earnings growth (-56.8%) over the past year, making it difficult to compare to the Aerospace & Defense industry average (-2%).


Return on Equity

High ROE: CAE's Return on Equity (6.2%) is considered low.


Next Steps

Financial Health

How is CAE's financial position?


Financial Position Analysis

Short Term Liabilities: CAE's short term assets (CA$2.2B) exceed its short term liabilities (CA$1.9B).

Long Term Liabilities: CAE's short term assets (CA$2.2B) do not cover its long term liabilities (CA$3.4B).


Debt to Equity History and Analysis

Debt Level: CAE's debt to equity ratio (97.6%) is considered high.

Reducing Debt: CAE's debt to equity ratio has increased from 63.7% to 97.6% over the past 5 years.

Debt Coverage: CAE's debt is well covered by operating cash flow (22.6%).

Interest Coverage: CAE's interest payments on its debt are well covered by EBIT (3.3x coverage).


Balance Sheet


Next Steps

Dividend

What is CAE current dividend yield, its reliability and sustainability?

0.86%

Forecast Dividend Yield


Dividend Yield vs Market

Notable Dividend: Unable to evaluate CAE's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate CAE's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CAE's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CAE's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: CAE is not paying a notable dividend for the Canadian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CAE's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.7yrs

Average management tenure


CEO

Marc Parent (59 yo)

11yrs

Tenure

CA$7,423,461

Compensation

Mr. Marc Parent has been the Chief Executive Officer and President of CAE Inc. since October 2009 and its Director since November 2008. Mr. Parent joined CAE in February 2005 as Group President, Simulation ...


CEO Compensation Analysis

Compensation vs Market: Marc's total compensation ($USD5.58M) is above average for companies of similar size in the Canadian market ($USD3.01M).

Compensation vs Earnings: Marc's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Marc Parent
President11yrsCA$7.42m0.11%
CA$ 6.6m
Sonya Branco
VP of Finance & CFO4.42yrsCA$2.78m0.0065%
CA$ 394.2k
Mark Hounsell
General Counsel4.58yrsCA$1.60m0.0082%
CA$ 491.9k
Nick Leontidis
Group President of Civil Aviation Training Solutions14.42yrsCA$3.15m0.020%
CA$ 1.2m
Pascal Grenier
Vice President of Global Operations3.25yrsno data0.0035%
CA$ 213.4k
Andrew Arnovitz
Vice President of Investor Relations & Strategy13.75yrsno data0.0014%
CA$ 83.2k
Hélène Gagnon
Vice President of Public Affairs & Global Communications5.58yrsno data0.0026%
CA$ 156.1k
Dan Sharkey
Vice President of Global Human Resources5.58yrsno data0.0032%
CA$ 191.1k
Heidi Wood
President of CAE Healthcare and Executive VP of Business Development & Growth Initiatives0.42yrno datano data
Daniel Gelston
Group President of Defence & Security0.17yrno datano data
Mario Pizzolongo
Treasurer4.75yrsno datano data
Constantino Malatesta
VP & Corporate Controller4.42yrsno datano data

4.7yrs

Average Tenure

Experienced Management: CAE's management team is considered experienced (4.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Marc Parent
President11yrsCA$7.42m0.11%
CA$ 6.6m
Michael Roach
Independent Director2.83yrsCA$183.29kno data
Michael Fortier
Independent Director10.17yrsCA$192.00kno data
Andrew Stevens
Independent Director7.75yrsCA$190.71kno data
John Manley
Independent Chairman of Board2.17yrsCA$310.00kno data
François Olivier
Independent Director3.58yrsCA$187.00kno data
Marianne Harrison
Independent Director1.17yrsCA$111.34k0.0059%
CA$ 353.8k
Margaret Billson
Independent Director5.17yrsCA$193.29kno data
Alan MacGibbon
Independent Director5.42yrsCA$202.00k0.0015%
CA$ 92.8k
David Perkins
Independent Director0.42yrno datano data

4.4yrs

Average Tenure

60.5yo

Average Age

Experienced Board: CAE's board of directors are considered experienced (4.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

CAE Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: CAE Inc.
  • Ticker: CAE
  • Exchange: TSX
  • Founded: 1947
  • Industry: Aerospace and Defense
  • Sector: Capital Goods
  • Market Cap: CA$6.028b
  • Shares outstanding: 265.78m
  • Website: https://www.cae.com

Number of Employees


Location

  • CAE Inc.
  • 8585 Cote-de-Liesse
  • Saint-Laurent
  • Quebec
  • H4T 1G6
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CAETSX (The Toronto Stock Exchange)YesCommon SharesCACADDec 1972
CAENYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 1972
CE9DB (Deutsche Boerse AG)YesCommon SharesDEEURDec 1972
CAE NBMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNDec 1972

Biography

CAE Inc., together with its subsidiaries, provides training solutions for the civil aviation, defence and security, and healthcare markets worldwide. The company’s Civil Aviation Training Solutions segment ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/31 00:26
End of Day Share Price2020/10/30 00:00
Earnings2020/06/30
Annual Earnings2020/03/31


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.