Magellan Aerospace (TSX:MAL) - Share price, News & Analysis

MAL fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	4/6
Past Performance	0/6
Financial Health	5/6
Dividends	1/6

MAL Stock Overview

Rewards

Trading at 27.9% below our estimate of its fair value

Earnings are forecast to grow 141.16% per year

Risk Analysis

Dividend of 4.23% is not well covered by earnings or forecast to be in the next 3 years

Magellan Aerospace Competitors

Avcorp Industries

TSX:AVP

CA$38.9m

Spirit AeroSystems Holdings

NYSE:SPR

US$3.1b

Aerospace Industrial Development

TWSE:2634

NT$31.8b

Triumph Group

NYSE:TGI

US$901.4m

Price History & Performance

Summary of all time highs, changes and price drops for Magellan Aerospace
Historical stock prices
Current Share Price	CA$7.56
52 Week High	CA$10.99
52 Week Low	CA$7.54
Beta	1.57
1 Month Change	-22.46%
3 Month Change	-22.94%
1 Year Change	-25.88%
3 Year Change	-53.13%
5 Year Change	-64.00%
Change since IPO	-84.08%

Recent News & Updates

May 12

Magellan Aerospace's (TSE:MAL) Dividend Is Being Reduced To CA$0.08

Magellan Aerospace Corporation ( TSE:MAL ) is reducing its dividend to CA$0.08 on the 30th of June. However, the...

Shareholder Returns

	MAL	CA Aerospace & Defense	CA Market
7D	-9.6%	-1.2%	0.8%
1Y	-25.9%	-22.7%	4.8%

Return vs Industry: MAL underperformed the Canadian Aerospace & Defense industry which returned -22.7% over the past year.

Return vs Market: MAL underperformed the Canadian Market which returned 4.9% over the past year.

Price Volatility

Is MAL's price volatile compared to industry and market?
MAL volatility
MAL Average Weekly Movement	3.8%
Aerospace & Defense Industry Average Movement	8.5%
Market Average Movement	9.8%
10% most volatile stocks in CA Market	17.0%
10% least volatile stocks in CA Market	4.4%

Stable Share Price: MAL is less volatile than 75% of Canadian stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: MAL's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1994	3,400	Phil Underwood	https://www.magellan.aero

Magellan Aerospace Corporation, through its subsidiaries, designs, engineers, manufactures, and sells aero engine and structure components for the aerospace markets in Canada, the United States, Europe, and Asia. It offers aero engine products, such as engine frames, cases, bypass ducts, engine shafts, engine processes, engine materials, metallic honeycomb, filament winding, compressor components, turbine components, and afterburner components, as well as small and large wing components, landing gear, horizontal and vertical stabilizers, and nacelle exhaust systems. The company also provides crown modules, vane box and transition ducts, wing spars, wing ribs, wing skins, access covers, and kitting solutions; black brant, rato booster motors, as well as rocket weapon system comprises of fixed wing variant, and rotary wing platforms.

Magellan Aerospace Fundamentals Summary

How do Magellan Aerospace's earnings and revenue compare to its market cap?
MAL fundamental statistics
Market Cap	CA$436.43m
Earnings (TTM)	-CA$6.26m
Revenue (TTM)	CA$699.79m

0.6x

P/S Ratio

-69.7x

P/E Ratio

Is MAL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
MAL income statement (TTM)
Revenue	CA$699.79m
Cost of Revenue	CA$664.75m
Gross Profit	CA$35.04m
Other Expenses	CA$41.30m
Earnings	-CA$6.26m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	-0.11
Gross Margin	5.01%
Net Profit Margin	-0.89%
Debt/Equity Ratio	4.7%

How did MAL perform over the long term?

See historical performance and comparison

Dividends

4.2%

Current Dividend Yield

-387%

Payout Ratio

Does MAL pay a reliable dividends?

See MAL dividend history and benchmarks

When do you need to buy MAL by to receive an upcoming dividend?
Magellan Aerospace dividend dates
Ex Dividend Date	Jun 15 2022
Dividend Pay Date	Jun 30 2022
Days until Ex dividend	22 days
Days until Dividend pay date	37 days

Does MAL pay a reliable dividends?

See MAL dividend history and benchmarks

Valuation

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

Valuation Score

3/6

Valuation Score 3/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

27.9%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: MAL (CA$7.56) is trading below our estimate of fair value (CA$10.48)

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

Price To Earnings Ratio

PE vs Industry: MAL is unprofitable, so we can't compare its PE Ratio to the North American Aerospace & Defense industry average.

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

Price to Earnings Growth Ratio

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

Price to Book Ratio

PB vs Industry: MAL is good value based on its PB Ratio (0.6x) compared to the CA Aerospace & Defense industry average (2.4x).

Future Growth

How is Magellan Aerospace forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

141.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: MAL is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.6%).

Earnings vs Market: MAL is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: MAL's is expected to become profitable in the next 3 years.

Revenue vs Market: MAL's revenue (13.2% per year) is forecast to grow faster than the Canadian market (6.4% per year).

High Growth Revenue: MAL's revenue (13.2% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

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

Past Performance

How has Magellan Aerospace performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-43.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: MAL is currently unprofitable.

Growing Profit Margin: MAL is currently unprofitable.

Past Earnings Growth Analysis

Earnings Trend: MAL is unprofitable, and losses have increased over the past 5 years at a rate of 43.9% per year.

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

Earnings vs Industry: MAL is unprofitable, making it difficult to compare its past year earnings growth to the Aerospace & Defense industry (27.7%).

Return on Equity

High ROE: MAL has a negative Return on Equity (-0.84%), as it is currently unprofitable.

Financial Health

How is Magellan Aerospace's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: MAL's short term assets (CA$483.3M) exceed its short term liabilities (CA$146.4M).

Long Term Liabilities: MAL's short term assets (CA$483.3M) exceed its long term liabilities (CA$101.3M).

Debt to Equity History and Analysis

Debt Level: MAL's net debt to equity ratio (2.3%) is considered satisfactory.

Reducing Debt: MAL's debt to equity ratio has reduced from 22.4% to 4.7% over the past 5 years.

Debt Coverage: MAL's debt is well covered by operating cash flow (94.8%).

Interest Coverage: Insufficient data to determine if MAL's interest payments on its debt are well covered by EBIT.

Balance Sheet

Dividend

What is Magellan Aerospace current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

4.23%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: MAL's dividend (4.23%) is higher than the bottom 25% of dividend payers in the Canadian market (1.91%).

High Dividend: MAL's dividend (4.23%) is low compared to the top 25% of dividend payers in the Canadian market (4.91%).

Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, MAL has been paying a dividend for less than 10 years.

Growing Dividend: MAL's dividend payments have increased, but the company has only paid a dividend for 9 years.

Earnings Payout to Shareholders

Earnings Coverage: MAL is paying a dividend but the company is unprofitable.

Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (194.5%), MAL's dividend payments are not well covered by cash flows.

Discover strong dividend paying companies

Management

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

5.2yrs

Average management tenure

CEO

Phil Underwood

8yrs

Tenure

CA$825,297

Compensation

Mr. Phillip Campion Underwood, also known as Phil, has been the President of Magellan Aerospace Corporation since May 13, 2014 and has been its Chief Executive Officer since January 1, 2015. Mr. Underwood...

CEO Compensation Analysis

Compensation vs Market: Phil's total compensation ($USD642.83K) is below average for companies of similar size in the Canadian market ($USD985.93K).

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

Leadership Team

Experienced Management: MAL's management team is seasoned and experienced (5.2 years average tenure).

Board Members

Experienced Board: MAL's board of directors are considered experienced (8.5 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.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/05/22 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31