TSX:DRT

Stock Analysis Report

DIRTT Environmental Solutions

Executive Summary

DIRTT Environmental Solutions Ltd. designs, manufactures, and installs customized prefabricated interiors.

Snowflake

Fundamentals

Flawless balance sheet and slightly overvalued.

Share Price & News

How has DIRTT Environmental Solutions's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

2.0%

DRT

2.2%

CA Building

0.2%

CA Market


1 Year Return

-1.0%

DRT

16.9%

CA Building

1.2%

CA Market

Return vs Industry: DRT underperformed the Canadian Building industry which returned 16.9% over the past year.

Return vs Market: DRT underperformed the Canadian Market which returned 1.2% over the past year.


Shareholder returns

DRTIndustryMarket
7 Day2.0%2.2%0.2%
30 Day-0.8%-0.7%-2.5%
90 Day-17.2%4.3%-1.5%
1 Year-1.0%-1.0%18.7%16.9%4.7%1.2%
3 Year22.2%22.2%29.1%18.2%14.0%3.8%
5 Year64.4%64.4%71.2%68.9%26.4%8.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is DIRTT Environmental Solutions undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: DRT (CA$6) is trading below our estimate of fair value (CA$13.54)

Significantly Undervalued: DRT is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: DRT is unprofitable, so we can't compare its PE Ratio to the Building industry average.

PE vs Market: DRT is unprofitable, so we can't compare its PE Ratio to the Canadian market.


Price to Earnings Growth Ratio

Low PEG Ratio: Insufficient data to calculate DRT's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: DRT is overvalued based on its PB Ratio (3.1x) compared to the CA Building industry average (1.2x).


Next Steps

Future Growth

How is DIRTT Environmental Solutions forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

98.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DRT is forecast to remain unprofitable over the next 3 years.

Earnings vs Market: DRT is forecast to remain unprofitable over the next 3 years.

High Growth Earnings: DRT is forecast to remain unprofitable over the next 3 years.

Revenue vs Market: DRT's revenue (8.2% per year) is forecast to grow faster than the Canadian market (5.7% per year).

High Growth Revenue: DRT's revenue (8.2% 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 DRT's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has DIRTT Environmental Solutions performed over the past 5 years?

-22.3%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: DRT is unprofitable, and losses have increased over the past 5 years at a rate of -22.3% per year.

Accelerating Growth: Unable to compare DRT's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: DRT is unprofitable, making it difficult to compare its past year earnings growth to the Building industry (8.2%).


Return on Equity

High ROE: DRT has a negative Return on Equity (-3.78%), as it is currently unprofitable.


Return on Assets

ROA vs Industry: DRT is currently unprofitable, so its Return on Assets is negative.


Return on Capital Employed

ROCE Improving: DRT is currently unprofitable, so its Return on Capital Employed is negative.


Next Steps

Financial Health

How is DIRTT Environmental Solutions's financial position?


Financial Position Analysis

Short Term Liabilities: DRT's short term assets (CA$141.6M) exceeds its short term liabilities (CA$55.5M)

Long Term Liabilities: DRT's short term assets (141.6M) exceeds its long term liabilities (24.9M)


Debt to Equity History and Analysis

Debt Level: DRT is debt free.

Reducing Debt: DRT has no debt compared to 5 years ago when its debt to equity ratio was 16.4%.


Balance Sheet

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

Debt Coverage by Assets: Insufficient data to determine if DRT's debt is covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable DRT has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: DRT is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 70.3% per year.


Next Steps

Dividend

What is DIRTT Environmental Solutions's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%2.0%markettop25%5.9%industryaverage1.8%forecastin3Yearsn/a

Current dividend yield vs market & industry


Stability and Growth of Payments

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

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

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

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


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

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


Next Steps

Management

What is the CEO of DIRTT Environmental Solutions's salary, the management and board of directors tenure and is there insider trading?

0.8yrs

Average management tenure


CEO

Kevin O'Meara (54yo)

1.1yrs

Tenure

CA$6,129,801

Compensation

Mr. Kevin P. O'Meara, CPA has been a President, Chief Executive Officer and Director of DIRTT Environmental Solutions since September 10, 2018. He has served on the Advisory Board of GHK Capital Partners L ...


CEO Compensation Analysis

Compensation vs. Market: Kevin has recently become CEO, making it difficult to compare their total compensation against companies of similar size in the Canadian market.

Compensation vs Earnings: Insufficient data to compare Kevin's compensation with company performance.


Management Age and Tenure

0.8yrs

Average Tenure

54yo

Average Age

Experienced Management: DRT's management team is not considered experienced ( 0.8 years average tenure), which suggests a new team.


Board Age and Tenure

2.2yrs

Average Tenure

62yo

Average Age

Experienced Board: DRT's board of directors are not considered experienced ( 2.2 years average tenure), which suggests a new board.


Insider Trading

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


Recent Insider Transactions

BuyCA$268,92520 Sep 19
Todd Lillibridge
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares34,700
Max PriceCA$7.75
BuyCA$92,50116 Sep 19
Joseph Zirkman
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares15,000
Max PriceCA$6.17
BuyCA$154,11810 Sep 19
Kevin O'Meara
EntityIndividual
Role
Chief Executive Officer
President
Shares25,000
Max PriceCA$6.17
BuyCA$32,00210 Sep 19
Steven Parry
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares4,000
Max PriceCA$8.02
BuyCA$7,67610 Jun 19
Denise Karkkainen
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceCA$7.68
BuyCA$5,59617 May 19
Christine McGinley
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares722
Max PriceCA$7.75
BuyCA$13,19815 May 19
Christine McGinley
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,703
Max PriceCA$7.75
BuyCA$58,83515 May 19
Wayne Boulais
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares7,500
Max PriceCA$7.84
BuyCA$80,72015 May 19
Joseph Zirkman
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares10,000
Max PriceCA$8.07
BuyCA$46,82414 May 19
Christine McGinley
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,908
Max PriceCA$8.01
SellCA$80,33013 May 19
John Elliott
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceCA$8.03
BuyCA$80,45013 May 19
John Elliott
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceCA$8.05
BuyCA$40,25313 May 19
Steven Parry
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares5,000
Max PriceCA$8.05
SellCA$1,610,16112 Nov 18
Geoff Gosling
EntityIndividual
Role
Top Key Executive
Co-Founder & Director of Innovation
Shares230,000
Max PriceCA$7.00
SellCA$213,99306 Nov 18
Tracy Baker
EntityIndividual
Shares30,658
Max PriceCA$6.98
SellCA$436,10006 Nov 18
Geoff Gosling
EntityIndividual
Role
Top Key Executive
Co-Founder & Director of Innovation
Shares62,300
Max PriceCA$7.00

Ownership Breakdown


Management Team

  • Kevin O'Meara (54yo)

    President

    • Tenure: 1.1yrs
    • Compensation: CA$6.13m
  • Joe Zirkman (58yo)

    Senior VP

    • Tenure: 0.8yrs
  • Geoff Krause (50yo)

    Chief Financial Officer

    • Tenure: 1.3yrs
    • Compensation: CA$478.17k
  • Geoff Gosling (58yo)

    Co-Founder & Director of Innovation

    • Tenure: 15.7yrs
    • Compensation: CA$1.25m
  • Peter Henry

    • Tenure: 1.3yrs
    • Compensation: CA$563.86k
  • Kim MacEachern

    Director of Investor Relations

    • Tenure: 0yrs
  • Jeffrey Calkins (59yo)

    Chief Operating Officer

    • Tenure: 0.8yrs
  • Mark Greffen (47yo)

    Chief Technology Officer

    • Tenure: 0.8yrs
  • Krista Pell (46yo)

    Senior Vice President of Talent

    • Tenure: 0.8yrs
  • Kingsley Koch

    Vice President of Sales

    • Tenure: 0.8yrs

Board Members

  • Kevin O'Meara (54yo)

    President

    • Tenure: 1.1yrs
    • Compensation: CA$6.13m
  • Ron Kaplan (68yo)

    Director

    • Tenure: 1.5yrs
    • Compensation: CA$455.30k
  • Wayne Boulais (55yo)

    Independent Director

    • Tenure: 4.4yrs
    • Compensation: CA$155.50k
  • Steve Parry (63yo)

    Independent Chairman of the Board

    • Tenure: 1yrs
    • Compensation: CA$181.00k
  • Jack Elliott (67yo)

    Independent Director

    • Tenure: 1.5yrs
    • Compensation: CA$79.28k
  • Todd Lillibridge (63yo)

    Independent Director

    • Tenure: 2.2yrs
    • Compensation: CA$160.00k
  • Richard Haray (62yo)

    Independent Director

    • Tenure: 2.9yrs
    • Compensation: CA$136.00k
  • Chris McGinley (60yo)

    Independent Director

    • Tenure: 5.9yrs
    • Compensation: CA$131.00k
  • Denise Karkkainen (55yo)

    Independent Director

    • Tenure: 4.2yrs
    • Compensation: CA$244.00k

Company Information

DIRTT Environmental Solutions Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: DIRTT Environmental Solutions Ltd.
  • Ticker: DRT
  • Exchange: TSX
  • Founded: 2003
  • Industry: Building Products
  • Sector: Capital Goods
  • Market Cap: CA$508.088m
  • Shares outstanding: 84.68m
  • Website: https://www.dirtt.net

Number of Employees


Location

  • DIRTT Environmental Solutions Ltd.
  • 7303-30th Street S.E.
  • Calgary
  • Alberta
  • T2C 1N6
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DRTTSX (The Toronto Stock Exchange)YesCommon SharesCACADNov 2013
D13DB (Deutsche Boerse AG)YesCommon SharesDEEURNov 2013
DRTTNasdaqGS (Nasdaq Global Select)YesCommon SharesUSUSDNov 2013

Biography

DIRTT Environmental Solutions Ltd. designs, manufactures, and installs customized prefabricated interiors. The company combines its proprietary 3D design, configuration, and manufacturing software with int ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/17 00:27
End of Day Share Price2019/10/16 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.