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.


Snowflake Analysis

Flawless balance sheet average dividend payer.

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's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-10.1%

PSI

-8.8%

CA Energy Services

-0.03%

CA Market


1 Year Return

-60.7%

PSI

-63.3%

CA Energy Services

-10.8%

CA Market

Return vs Industry: PSI exceeded the Canadian Energy Services industry which returned -62.8% over the past year.

Return vs Market: PSI underperformed the Canadian Market which returned -11.3% over the past year.


Shareholder returns

PSIIndustryMarket
7 Day-10.1%-8.8%-0.03%
30 Day-8.1%-12.5%1.8%
90 Day2.6%10.8%8.4%
1 Year-57.7%-60.7%-61.2%-63.3%-7.6%-10.8%
3 Year-55.3%-61.4%-72.3%-75.1%5.4%-4.7%
5 Year-54.0%-63.2%-75.8%-79.4%24.1%5.1%

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?

11.45x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: PSI (CA$7) is trading above our estimate of fair value (CA$3.33)

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 (11.5x) compared to the CA Energy Services industry average (6x).

PE vs Market: PSI is good value based on its PE Ratio (11.5x) compared to the Canadian market (13.3x).


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 (1.6x) compared to the CA Energy Services industry average (0.3x).


Next Steps

Future Growth

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

-86.1%

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 (-86.1% per year).

Earnings vs Market: PSI's earnings are forecast to decline over the next 3 years (-86.1% 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 (-6.3% per year).

High Growth Revenue: PSI's revenue is forecast to decline over the next 3 years (-6.3% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Pason Systems performed over the past 5 years?

22.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PSI has high quality earnings.

Growing Profit Margin: PSI's current net profit margins (18.1%) are lower than last year (22.1%).


Past Earnings Growth Analysis

Earnings Trend: PSI's earnings have grown significantly by 22.8% 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 (-25.4%) over the past year, making it difficult to compare to the Energy Services industry average (6.1%).


Return on Equity

High ROE: PSI's Return on Equity (13.8%) 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$251.4M) exceed its short term liabilities (CA$43.9M).

Long Term Liabilities: PSI's short term assets (CA$251.4M) exceed its long term liabilities (CA$33.6M).


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?

10.86%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: PSI's dividend (10.86%) is higher than the bottom 25% of dividend payers in the Canadian market (1.87%).

High Dividend: PSI's dividend (10.86%) is in the top 25% of dividend payers in the Canadian market (6.03%)


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (122.7%), PSI's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

1.5yrs

Average management tenure


CEO

Marcel Kessler (53yo)

8.67yrs

Tenure

CA$2,725,100

Compensation

Mr. Marcel Kessler has been the Chief Executive Officer and President of Pason Systems Inc., since November 07, 2011. Mr. Kessler has been a Partner of McKinsey & Company since 2001. Mr. Kessler served as  ...


CEO Compensation Analysis

Compensation vs Market: Marcel's total compensation ($USD2.01M) is above average for companies of similar size in the Canadian market ($USD1.05M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Marcel Kessler
President8.67yrsCA$2.73m0.077% CA$469.3k
Jon Faber
Chief Financial Officer6.33yrsCA$1.23m0.026% CA$155.2k
Timur Kuru
President & GM of United States0.50yrCA$1.32m0.077% CA$467.7k
Natalie Fenez
General Counsel & Corporate Secretary1.5yrsno data0.0019% CA$11.5k
Reid Wuntke
President of Energy Toolbase0.50yrno datano data
Fiona Mueller-Thode
President of Verdazo Analytics Inc.0.50yrno 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 & Development3.5yrsno data0.13% CA$814.5k

1.5yrs

Average Tenure

Experienced Management: PSI's management team is not considered experienced ( 1.5 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Marcel Kessler
President8.67yrsCA$2.73m0.077% CA$469.3k
T. Collins
Independent Director7.92yrsCA$198.54kno data
Judi Hess
Independent Director5.42yrsCA$181.28kno data
James Howe
Independent Lead Directorno dataCA$97.03k0.41% CA$2.5m
James Hill
Chairman of the Boardno dataCA$168.43k6.65% CA$40.4m
Laura Schwinn
Independent Non-Executive Director0.92yrCA$33.11kno data

6.7yrs

Average Tenure

65yo

Average Age

Experienced Board: PSI's board of directors are considered experienced (6.7 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

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$607.532m
  • Shares outstanding: 84.15m
  • 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 parameters; Electronic Choke Actuator that provides a means of remotely controlling the choke valve; and Electronic Drilling Recorder, a drilling recorder. It also provides Pit Volume Totalizer, a well control system; ExxonMobil DAS, a drilling automation package; Gas Analyzer to detect the changes in relative volumes of hydrocarbon gases; Hazardous Gas Alarm System, which detects the presence of combustible gases and offers visible and audible alerts; Rig Communications that provides remote data communications for drillers; Rig Display, a touch screen computer to access services and applications on and around the rig floor; and SideKick, a rig floor computer, which allows for data entry and displays information around the rig. In addition, the company offers DataHub, a Web application, which collects, stores, and displays drilling data, reports, and real-time information for remote access; Directional System, an application that enables directional drillers to monitor and manage multiple wells; and Drilling Guidance System, which provides real-time guidance. Further, it offers Pason Live, a Web-based data viewer, which provides visualization tools that display real-time drilling data; Tour Sheet Analytics that delivers insight into the data; WellView Field Solution, a corporate well file, which begins at the request to drill and follows through to the well completion; and VERDAZO visual analytics software, as well as training and maintenance services. The company serves operators and contractors. It has operations in Canada, the United States, and internationally. Pason Systems Inc. was founded in 1978 and is headquartered in Calgary, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/07/13 23:55
End of Day Share Price2020/07/13 00:00
Earnings2020/03/31
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.