TSX:CAS

Stock Analysis Report

Executive Summary

Cascades Inc. produces, converts, and markets packaging and tissue products in Canada, the United States, and internationally.


Snowflake Analysis

Established dividend payer and fair value.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

-7.0%

CAS

-6.1%

CA Packaging

-6.2%

CA Market


1 Year Return

25.4%

CAS

-12.0%

CA Packaging

-2.0%

CA Market

Return vs Industry: CAS exceeded the Canadian Packaging industry which returned -12% over the past year.

Return vs Market: CAS exceeded the Canadian Market which returned -2% over the past year.


Shareholder returns

CASIndustryMarket
7 Day-7.0%-6.1%-6.2%
30 Day-4.7%-16.8%-5.0%
90 Day-12.3%-16.6%-2.8%
1 Year28.2%25.4%-10.9%-12.0%1.1%-2.0%
3 Year-14.9%-18.8%-18.8%-21.4%10.7%0.6%
5 Year49.6%37.8%44.7%35.6%27.6%8.9%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

41.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CAS (CA$10.91) is trading below our estimate of fair value (CA$18.54)

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


Price To Earnings Ratio

PE vs Industry: CAS is poor value based on its PE Ratio (17.1x) compared to the Packaging industry average (16.9x).

PE vs Market: CAS is poor value based on its PE Ratio (17.1x) compared to the Canadian market (14.8x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: CAS is good value based on its PB Ratio (0.7x) compared to the CA Packaging industry average (1.6x).


Next Steps

Future Growth

How is Cascades forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

-16.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CAS's earnings are forecast to decline over the next 3 years (-16.4% per year).

Earnings vs Market: CAS's earnings are forecast to decline over the next 3 years (-16.4% per year).

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

Revenue vs Market: CAS's revenue (2.8% per year) is forecast to grow slower than the Canadian market (4.7% per year).

High Growth Revenue: CAS's revenue (2.8% 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 CAS's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Cascades performed over the past 5 years?

33.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CAS has high quality earnings.

Growing Profit Margin: CAS's current net profit margins (1.2%) are lower than last year (4%).


Past Earnings Growth Analysis

Earnings Trend: CAS has become profitable over the past 5 years, growing earnings by 33.4% per year.

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

Earnings vs Industry: CAS had negative earnings growth (-66.9%) over the past year, making it difficult to compare to the Packaging industry average (-17.9%).


Return on Equity

High ROE: CAS's Return on Equity (5.3%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Cascades's financial position?


Financial Position Analysis

Short Term Liabilities: CAS's short term assets (CA$1.5B) exceed its short term liabilities (CA$1.0B).

Long Term Liabilities: CAS's short term assets (CA$1.5B) do not cover its long term liabilities (CA$2.6B).


Debt to Equity History and Analysis

Debt Level: CAS's debt to equity ratio (115.1%) is considered high.

Reducing Debt: CAS's debt to equity ratio has reduced from 155.6% to 115.1% over the past 5 years.

Debt Coverage: CAS's debt is not well covered by operating cash flow (18.9%).

Interest Coverage: CAS's interest payments on its debt are not well covered by EBIT (2.3x coverage).


Balance Sheet

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

Debt Coverage by Assets: CAS's debt is not covered by short term assets (assets are 0.7x debt).


Next Steps

Dividend

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

2.93%

Current Dividend Yield


Dividend Yield vs Market

company2.9%marketbottom25%2.1%markettop25%5.9%industryaverage2.7%forecastin3Years2.9%

Current dividend yield vs market & industry

Notable Dividend: CAS's dividend (2.93%) is higher than the bottom 25% of dividend payers in the Canadian market (2.07%).

High Dividend: CAS's dividend (2.93%) is low compared to the top 25% of dividend payers in the Canadian market (5.91%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (31.3%), CAS's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CAS's dividends in 3 years are forecast to be well covered by earnings (33.6% payout ratio).


Next Steps

Management

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

7.1yrs

Average management tenure


CEO

Mario Plourde (58yo)

6.8yrs

Tenure

CA$3,775,031

Compensation

Mr. Mario Plourde has been the Chief Executive Officer and President of Cascades, Inc., since May 9, 2013. Mr. Plourde has been Director at Cascades Inc. since November 06, 2014. Mr. Plourde served as the ...


CEO Compensation Analysis

Compensation vs Market: Mario's total compensation ($USD2.83M) is above average for companies of similar size in the Canadian market ($USD1.69M).

Compensation vs Earnings: Mario's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Alain Lemaire
Co-Founder & Executive Chairman6.8yrsCA$1.24m5.55% CA$57.0m
Mario Plourde
President6.8yrsCA$3.78m0.22% CA$2.3m
Allan Hogg
VP & CFO9.8yrsCA$1.27m0.094% CA$963.8k
Luc Langevin
President & COO of the Cascades Specialty Products Group8.8yrsCA$1.21m0.048% CA$495.7k
Charles Malo
President & COO of Containerboard Packaging Group0yrsCA$1.16m0.088% CA$901.4k
Dominic Doré
Chief Supply Chain & Information Officer10.1yrsno data0.019% CA$199.7k
Jennifer Aitken
Director of Investor Relations0yrsno datano data
Robert Hall
Chief of Strategy4.1yrsCA$1.02m0.23% CA$2.3m
Hugo D'Amours
Vice-President of Communications7.1yrsno data0.0081% CA$83.0k
Maryse Fernet
Chief Human Resources Officer4.1yrsno data0.027% CA$274.3k

7.1yrs

Average Tenure

58yo

Average Age

Experienced Management: CAS's management team is seasoned and experienced (7.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Alain Lemaire
Co-Founder & Executive Chairman6.8yrsCA$1.24m5.55% CA$57.0m
Mario Plourde
President6.8yrsCA$3.78m0.22% CA$2.3m
Georges Kobrynsky
Lead Director0yrsCA$157.50kno data
Michelle Cormier
Independent Director3.6yrsCA$119.50k0.0095% CA$98.2k
Laurence Sellyn
Independent Director6.8yrsCA$126.00k0.037% CA$381.9k
Louis Garneau
Independent Director24.1yrsCA$98.50k0.0053% CA$54.7k
Sylvie Lemaire
Non-Independent Director21.1yrsCA$123.50k0.13% CA$1.4m
Sylvie Vachon
Independent Director6.8yrsCA$119.50k0.0042% CA$43.6k
Martin Couture
Independent Director3.6yrsCA$119.50k0.022% CA$231.1k
Élise Pelletier
Independent Director9.1yrsCA$117.00k0.0021% CA$21.8k

6.8yrs

Average Tenure

59.5yo

Average Age

Experienced Board: CAS's board of directors are considered experienced (6.8 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: CAS 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

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


Key Information

  • Name: Cascades Inc.
  • Ticker: CAS
  • Exchange: TSX
  • Founded: 1964
  • Industry: Paper Packaging
  • Sector: Materials
  • Market Cap: CA$1.028b
  • Shares outstanding: 94.25m
  • Website: https://www.cascades.com

Number of Employees


Location

  • Cascades Inc.
  • 404 Marie-Victorin Boulevard
  • Kingsey Falls
  • Quebec
  • J0A 1B0
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CASTSX (The Toronto Stock Exchange)YesCommon SharesCACADOct 1984
CS6DB (Deutsche Boerse AG)YesCommon SharesDEEUROct 1984
CADN.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDOct 1984

Biography

Cascades Inc. produces, converts, and markets packaging and tissue products in Canada, the United States, and internationally. The company operates through four segments: Containerboard, Boxboard Europe, Specialty Products, and Tissue Papers. It offers containerboards, and coated recycled and virgin boxboards, as well as converts corrugated products. The company also provides roll headers; wrappers; packaging reams; laminated paperboards for food packaging and furniture backing industries; specialty containers; honeycomb paperboards; uncoated paperboard partitions for the beer, wine, and spirits industry; uncoated recycled paperboards for use in packaging converters and industrial users of headers and wrappers for the paper industry, as well as partitions used as protective packaging; and backing for vinyl flooring. In addition, it provides egg filler flats for egg processors and four-cup carriers for the quick-service restaurant industry; polystyrene foam trays under the EVOK brand for processors and retailers in the food industry, as well as plate and bowls; rigid plastic packaging products under the Ultratill and Poultray brands for food processors and retailers; and flexible films for frozen foods, bakery, and ice industries. Further, the company offers services to recover and process discarded materials for the municipal, industrial, commercial, and institutional sectors. Additionally, it offers bathroom and facial tissues, paper towels, paper hand towels and napkins, parent rolls, industrial wipes, and other products under the Decor, North River, Cascades, Cascades Moka, Tandem, Tandem+, Cascades Elite, Wiping Solutions, Cascades PRO Signature, Cascades PRO Perform, Cascades PRO Select, Cascades Pro Tandem, Cascades PRO Tuff-Job, Cascades Fluff, Cascades Tuff, April Soft, and Nature’s Choice labels. The company sells its products through sales force and external representatives. Cascades Inc. was founded in 1964 and is headquartered in Kingsey Falls, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/28 00:15
End of Day Share Price2020/02/27 00:00
Earnings2019/09/30
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.