TSX:PSI

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Pason Systems Inc. provides instrumentation and data management systems for drilling rigs. More Details


Snowflake Analysis

Flawless balance sheet with questionable track record.

Share Price & News

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


Latest Share Price and Events

Stable Share Price: PSI is less volatile than 75% of Canadian stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: PSI's weekly volatility (6%) has been stable over the past year.


Market Performance


7 Day Return

21.8%

PSI

18.2%

CA Energy Services

1.7%

CA Market


1 Year Return

-41.8%

PSI

-38.2%

CA Energy Services

0.2%

CA Market

Return vs Industry: PSI underperformed the Canadian Energy Services industry which returned -38.2% over the past year.

Return vs Market: PSI underperformed the Canadian Market which returned 0.2% over the past year.


Shareholder returns

PSIIndustryMarket
7 Day21.8%18.2%1.7%
30 Day34.1%26.6%7.0%
90 Day25.9%19.7%5.1%
1 Year-37.5%-41.8%-35.8%-38.2%3.9%0.2%
3 Year-50.9%-57.6%-61.5%-65.0%13.1%2.1%
5 Year-56.2%-65.0%-57.5%-63.7%46.5%24.1%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

32.93x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: PSI (CA$7.48) is trading above our estimate of fair value (CA$1.77)

Significantly Below Fair Value: PSI is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: PSI is poor value based on its PE Ratio (32.9x) compared to the CA Energy Services industry average (16.6x).

PE vs Market: PSI is poor value based on its PE Ratio (32.9x) compared to the Canadian market (15.3x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: PSI is overvalued based on its PB Ratio (2x) compared to the CA Energy Services industry average (0.5x).


Next Steps

Future Growth

How is Pason Systems forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

-77.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PSI's earnings are forecast to decline over the next 3 years (-77.6% per year).

Earnings vs Market: PSI's earnings are forecast to decline over the next 3 years (-77.6% per year).

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

Revenue vs Market: PSI's revenue is expected to decline over the next 3 years (-0.2% per year).

High Growth Revenue: PSI's revenue is forecast to decline over the next 3 years (-0.2% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PSI's Return on Equity is forecast to be low in 3 years time (0.1%).


Next Steps

Past Performance

How has Pason Systems performed over the past 5 years?

47.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PSI has high quality earnings.

Growing Profit Margin: PSI's current net profit margins (10%) are lower than last year (20.8%).


Past Earnings Growth Analysis

Earnings Trend: PSI's earnings have grown significantly by 47.9% per year over the past 5 years.

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

Earnings vs Industry: PSI had negative earnings growth (-70.2%) over the past year, making it difficult to compare to the Energy Services industry average (-54.8%).


Return on Equity

High ROE: PSI's Return on Equity (5.7%) is considered low.


Next Steps

Financial Health

How is Pason Systems's financial position?


Financial Position Analysis

Short Term Liabilities: PSI's short term assets (CA$212.3M) exceed its short term liabilities (CA$45.3M).

Long Term Liabilities: PSI's short term assets (CA$212.3M) exceed its long term liabilities (CA$27.9M).


Debt to Equity History and Analysis

Debt Level: PSI is debt free.

Reducing Debt: PSI has not had any debt for past 5 years.

Debt Coverage: PSI has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: PSI has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Pason Systems's current dividend yield, its reliability and sustainability?

2.67%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: PSI's dividend (2.67%) is higher than the bottom 25% of dividend payers in the Canadian market (1.65%).

High Dividend: PSI's dividend (2.67%) is low compared to the top 25% of dividend payers in the Canadian market (5.28%).


Stability and Growth of Payments

Stable Dividend: PSI's dividend payments have been volatile in the past 10 years.

Growing Dividend: PSI's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (272.9%), PSI's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PSI's dividends in 3 years are not forecast to be well covered by earnings (187.5% payout ratio).


Next Steps

Management

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

0.8yrs

Average management tenure


CEO

Jon Faber

0.083

Tenure

CA$1,227,925

Compensation

Mr. Jon Faber, CFA, CBV, has been Director at Pason Systems Inc. since 2020 and also serves as it's President and Chief Executive Officer since October 01, 2020. Mr. Faber was the Chief Financial Officer o...


CEO Compensation Analysis

Compensation vs Market: Jon's total compensation ($USD942.34K) is about average for companies of similar size in the Canadian market ($USD864.82K).

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


Leadership Team

NamePositionTenureCompensationOwnership
Jon Faber
President0.083yrCA$1.23m0.038%
CA$ 228.5k
Timur Kuru
President & GM of United States0.83yrCA$1.32m0%
CA$ 0
David Elliott
Chief Financial Officer0.083yrCA$445.05k0.012%
CA$ 69.4k
Bryce McLean
Vice President of Operationsno datano data0.0087%
CA$ 51.9k
Lars Olesen
Vice President of Product & Technology0.83yrno data0.012%
CA$ 71.1k
Natalie Fenez
VP of Legal & Corporate Secretary1.83yrsno data0.0019%
CA$ 11.4k
Reid Wuntke
President of Energy Toolbase0.83yrno datano data
Fiona Mueller-Thode
President of Verdazo Analytics Inc.no datano datano data
Ben Thomas
Director of Support Services - United States Business Unitno dataCA$145.00kno data
Ryan van Beurden
Vice President of Rig-site Research & Development3.83yrsno data0.14%
CA$ 805.5k

0.8yrs

Average Tenure

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


Board Members

NamePositionTenureCompensationOwnership
Jon Faber
President0.083yrCA$1.23m0.038%
CA$ 228.5k
T. Collins
Independent Director8.25yrsCA$198.54kno data
Judi Hess
Independent Director5.75yrsCA$181.28kno data
James Howe
Independent Lead Directorno dataCA$97.03k0.42%
CA$ 2.5m
Marcel Kessler
Non-Executive Chairman0.083yrCA$2.73m0.078%
CA$ 464.1k
Laura Schwinn
Independent Non-Executive Director1.25yrsCA$33.11kno data

1.3yrs

Average Tenure

61yo

Average Age

Experienced Board: PSI's board of directors are not considered experienced ( 1.3 years average tenure), which suggests a new board.


Ownership

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


Insider Trading Volume

Insider Buying: PSI 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

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


Key Information

  • Name: Pason Systems Inc.
  • Ticker: PSI
  • Exchange: TSX
  • Founded: 1978
  • Industry: Oil and Gas Equipment and Services
  • Sector: Energy
  • Market Cap: CA$594.086m
  • Shares outstanding: 83.21m
  • Website: https://www.pason.com

Number of Employees


Location

  • Pason Systems Inc.
  • 6130 Third Street SE
  • Calgary
  • Alberta
  • T2H 1K4
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PSITSX (The Toronto Stock Exchange)YesCommon SharesCACADNov 1996
3PSDB (Deutsche Boerse AG)YesCommon SharesDEEURNov 1996
PSYT.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDNov 1996

Biography

Pason Systems Inc. provides instrumentation and data management systems for drilling rigs. The company offers Electronic AutoDriller, which maximizes the rate of penetration by monitoring various drilling ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/25 00:03
End of Day Share Price2020/11/24 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


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.