TSX:TCL.A

Stock Analysis Report

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Executive Summary

Transcontinental Inc. engages in the flexible packaging business in Canada, the United States, Latin America, the United Kingdom, Australia, and New Zealand. More Details


Snowflake Analysis

Undervalued established dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

3.5%

TCL.A

-1.6%

CA Commercial Services

-1.0%

CA Market


1 Year Return

10.2%

TCL.A

18.4%

CA Commercial Services

-4.3%

CA Market

Return vs Industry: TCL.A underperformed the Canadian Commercial Services industry which returned 19.9% over the past year.

Return vs Market: TCL.A exceeded the Canadian Market which returned -4.2% over the past year.


Shareholder returns

TCL.AIndustryMarket
7 Day3.5%-1.6%-1.0%
30 Day4.0%3.0%1.3%
90 Day15.5%6.3%1.9%
1 Year17.2%10.2%20.1%18.4%-0.9%-4.3%
3 Year-27.8%-37.6%53.1%43.4%6.4%-4.0%
5 Year4.3%-16.1%105.7%83.9%33.3%12.8%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

36.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TCL.A (CA$16.89) is trading below our estimate of fair value (CA$26.47)

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


Price To Earnings Ratio

PE vs Industry: TCL.A is good value based on its PE Ratio (7.6x) compared to the CA Commercial Services industry average (24.2x).

PE vs Market: TCL.A is good value based on its PE Ratio (7.6x) compared to the Canadian market (16.5x).


Price to Earnings Growth Ratio

PEG Ratio: TCL.A's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: TCL.A is good value based on its PB Ratio (0.9x) compared to the CA Commercial Services industry average (1.6x).


Next Steps

Future Growth

How is Transcontinental forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

-6.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TCL.A's earnings are forecast to decline over the next 3 years (-6.1% per year).

Earnings vs Market: TCL.A's earnings are forecast to decline over the next 3 years (-6.1% per year).

High Growth Earnings: TCL.A's earnings are forecast to decline over the next 3 years.

Revenue vs Market: TCL.A's revenue is expected to decline over the next 3 years (-1.5% per year).

High Growth Revenue: TCL.A's revenue is forecast to decline over the next 3 years (-1.5% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TCL.A's Return on Equity is forecast to be low in 3 years time (9.8%).


Next Steps

Past Performance

How has Transcontinental performed over the past 5 years?

-3.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TCL.A has high quality earnings.

Growing Profit Margin: TCL.A's current net profit margins (7.1%) are higher than last year (3.9%).


Past Earnings Growth Analysis

Earnings Trend: TCL.A's earnings have declined by 3.8% per year over the past 5 years.

Accelerating Growth: TCL.A's earnings growth over the past year (59.3%) exceeds its 5-year average (-3.8% per year).

Earnings vs Industry: TCL.A earnings growth over the past year (59.3%) exceeded the Commercial Services industry 15.4%.


Return on Equity

High ROE: TCL.A's Return on Equity (11.2%) is considered low.


Next Steps

Financial Health

How is Transcontinental's financial position?


Financial Position Analysis

Short Term Liabilities: TCL.A's short term assets (CA$927.9M) exceed its short term liabilities (CA$663.8M).

Long Term Liabilities: TCL.A's short term assets (CA$927.9M) do not cover its long term liabilities (CA$1.2B).


Debt to Equity History and Analysis

Debt Level: TCL.A's debt to equity ratio (60.6%) is considered high.

Reducing Debt: TCL.A's debt to equity ratio has increased from 38.8% to 60.6% over the past 5 years.

Debt Coverage: TCL.A's debt is well covered by operating cash flow (46.4%).

Interest Coverage: TCL.A's interest payments on its debt are well covered by EBIT (5.5x coverage).


Balance Sheet


Next Steps

Dividend

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

5.33%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TCL.A's dividend (5.33%) is higher than the bottom 25% of dividend payers in the Canadian market (1.69%).

High Dividend: TCL.A's dividend (5.33%) is low compared to the top 25% of dividend payers in the Canadian market (5.78%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (40.3%), TCL.A's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TCL.A's dividends in 3 years are forecast to be well covered by earnings (44.7% payout ratio).


Next Steps

Management

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

6.8yrs

Average management tenure


CEO

François Olivier (55 yo)

12.67yrs

Tenure

CA$6,883,624

Compensation

Mr. François Olivier has been the Chief Executive Officer and President of Transcontinental Inc. since February 20, 2008. Mr. Olivier is heading the diversification strategy of TC Transcontinental, driving ...


CEO Compensation Analysis

Compensation vs Market: François's total compensation ($USD5.24M) is above average for companies of similar size in the Canadian market ($USD1.32M).

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


Leadership Team

NamePositionTenureCompensationOwnership
François Olivier
President12.67yrsCA$6.88m0.18%
CA$ 2.7m
Rémi Marcoux
Founder & Director44.75yrsCA$90.00kno data
Donald LeCavalier
Chief Financial Officer2.08yrsCA$1.08m0.018%
CA$ 270.0k
Christine Desaulniers
Chief Legal Officer & Corporate Secretary14.92yrsCA$922.62k0.021%
CA$ 302.8k
Brian Reid
President of TC Transcontinental Printing6.75yrsCA$2.13m0.0034%
CA$ 50.5k
Thomas Morin
President of TC Transcontinental Packaging1.25yrsCA$1.77m0.0021%
CA$ 30.6k
Benoit Guilbault
Chief Information Officer7.5yrsno datano data
Yan Lapointe
Director of Investor Relationsno datano datano data
François Taschereau
Vice President of Corporate Communications & Public Affairs0.75yrno data0.0011%
CA$ 16.7k
Sam Bendavid
Vice President of Corporate Development2.75yrsno data0.00098%
CA$ 14.3k
Lyne Martel
Chief Human Resources Officerno datano datano data
Norrie Meth
Senior Vice President of Retail Group Transcontinental Printing - Marketing Productsno datano datano data

6.8yrs

Average Tenure

Experienced Management: TCL.A's management team is seasoned and experienced (6.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
François Olivier
President12.67yrsCA$6.88m0.18%
CA$ 2.7m
Rémi Marcoux
Founder & Director44.75yrsCA$90.00kno data
Mario Plourde
Independent Director5.58yrsCA$124.13k0.011%
CA$ 166.6k
François Roy
Independent Director12.42yrsCA$118.50k0.0057%
CA$ 84.2k
Isabelle Marcoux
Chair of the Board8.67yrsCA$1.03m0.0057%
CA$ 84.2k
Pierre Marcoux
Non-Independent Director15.58yrsCA$658.89k0.0069%
CA$ 100.9k
Jacynthe Côté
Independent Lead Director1.75yrsCA$140.03k0.0034%
CA$ 50.5k
Anna Martini
Independent Director9.58yrsCA$155.63k0.0043%
CA$ 63.1k
Annie Thabet
Independent Director4.92yrsCA$130.97k0.016%
CA$ 240.2k
Nathalie Marcoux
Non-Independent Director9.58yrsCA$112.70kno data
Jean Raymond
Independent Director3.58yrsCA$122.27kno data
H. Brues
Independent Director2.08yrsCA$121.56k0.021%
CA$ 308.8k

9.1yrs

Average Tenure

58yo

Average Age

Experienced Board: TCL.A's board of directors are considered experienced (9.1 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

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


Key Information

  • Name: Transcontinental Inc.
  • Ticker: TCL.A
  • Exchange: TSX
  • Founded: 1976
  • Industry: Commercial Printing
  • Sector: Commercial Services
  • Market Cap: CA$1.464b
  • Shares outstanding: 87.03m
  • Website: https://tctranscontinental.com

Number of Employees


Location

  • Transcontinental Inc.
  • 1 Place Ville Marie
  • Suite 3240
  • Montreal
  • Quebec
  • H3B 0G1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TCL.BTSX (The Toronto Stock Exchange)Class B SharesCACADMar 1985
TCLC.FOTCPK (Pink Sheets LLC)Class B SharesUSUSDMar 1985
TCL.ATSX (The Toronto Stock Exchange)YesClass A SharesCACADMay 1992
TCLA.FOTCPK (Pink Sheets LLC)YesClass A SharesUSUSDMay 1992
53LDB (Deutsche Boerse AG)YesClass A SharesDEEURMay 1992

Biography

Transcontinental Inc. engages in the flexible packaging business in Canada, the United States, Latin America, the United Kingdom, Australia, and New Zealand. It operates through three segments: Packaging, ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/22 00:01
End of Day Share Price2020/10/21 00:00
Earnings2020/07/26
Annual Earnings2019/10/27


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.