TSX:MDI

Stock Analysis Report

Major Drilling Group International

Executive Summary

Major Drilling Group International Inc. provides contract drilling services for mining and mineral exploration companies in Canada, the United States, Mexico, South America, Asia, Africa, and Europe.

Rewards

Revenue is forecast to grow 12.01% per year

Earnings have grown 29.3% per year over the past 5 years

Risk Analysis

Currently unprofitable and not forecast to become profitable over the next 3 years



Snowflake Analysis

Excellent balance sheet and overvalued.


Similar Companies

Share Price & News

How has Major Drilling Group International's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

5.5%

MDI

-0.9%

CA Metals and Mining

-0.08%

CA Market


1 Year Return

17.4%

MDI

21.9%

CA Metals and Mining

10.8%

CA Market

Return vs Industry: MDI underperformed the Canadian Metals and Mining industry which returned 21.9% over the past year.

Return vs Market: MDI exceeded the Canadian Market which returned 10.8% over the past year.


Shareholder returns

MDIIndustryMarket
7 Day5.5%-0.9%-0.08%
30 Day9.0%2.5%0.01%
90 Day5.5%-1.2%1.2%
1 Year17.4%17.4%22.9%21.9%14.4%10.8%
3 Year-12.0%-12.0%4.6%2.7%15.0%4.6%
5 Year9.2%8.4%40.1%35.8%40.1%19.4%

Price Volatility Vs. Market

How volatile is Major Drilling Group International's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Major Drilling Group International undervalued compared to its fair value and its price relative to the market?

1.27x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: MDI (CA$5.8) is trading above our estimate of fair value (CA$5.33)

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


Price To Earnings Ratio

PE vs Industry: MDI is unprofitable, so we can't compare its PE Ratio to the Metals and Mining industry average.

PE vs Market: MDI 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 MDI's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: MDI is good value based on its PB Ratio (1.3x) compared to the CA Metals and Mining industry average (1.3x).


Next Steps

Future Growth

How is Major Drilling Group International forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

12.0%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if MDI's forecast earnings growth is above the savings rate (1.4%).

Earnings vs Market: Insufficient data to determine if MDI's earnings are forecast to grow faster than the Canadian market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: MDI's revenue (12% per year) is forecast to grow faster than the Canadian market (4.9% per year).

High Growth Revenue: MDI's revenue (12% 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 MDI's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Major Drilling Group International performed over the past 5 years?

29.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MDI is currently unprofitable.

Growing Profit Margin: MDI is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: MDI is unprofitable, but has reduced losses over the past 5 years at a rate of 29.3% per year.

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

Earnings vs Industry: MDI is unprofitable, making it difficult to compare its past year earnings growth to the Metals and Mining industry (4.1%).


Return on Equity

High ROE: MDI has a negative Return on Equity (-1.51%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Major Drilling Group International's financial position?


Financial Position Analysis

Short Term Liabilities: MDI's short term assets (CA$232.0M) exceed its short term liabilities (CA$70.0M).

Long Term Liabilities: MDI's short term assets (CA$232.0M) exceed its long term liabilities (CA$34.5M).


Debt to Equity History and Analysis

Debt Level: MDI's debt to equity ratio (4.6%) is considered satisfactory.

Reducing Debt: MDI's debt to equity ratio has increased from 4% to 4.6% over the past 5 years.


Balance Sheet

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

Debt Coverage by Assets: MDI's debt is covered by short term assets (assets are 13.8x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable MDI has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: MDI is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 32% per year.


Next Steps

Dividend

What is Major Drilling Group International's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%2.0%markettop25%5.6%industryaverage1.2%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate MDI's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate MDI's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if MDI's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if MDI's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: MDI is not paying a notable dividend for the Canadian market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of MDI's dividend in 3 years as they are not forecast to pay a notable one for the Canadian market.


Next Steps

Management

What is the CEO of Major Drilling Group International's salary, the management and board of directors tenure and is there insider trading?

1.9yrs

Average management tenure


CEO

Denis Larocque (49yo)

4.3yrs

Tenure

CA$909,564

Compensation

Mr. Denis Larocque has been President and Chief Executive Officer of Major Drilling Group International Inc. since September 11, 2015. Mr. Larocque joined Major Drilling Group International Inc. in 1994 an ...


CEO Compensation Analysis

Compensation vs Market: Denis's total compensation ($USD687.61K) is below average for companies of similar size in the Canadian market ($USD1.08M).

Compensation vs Earnings: Denis's compensation has increased whilst the company is unprofitable.


Management Age and Tenure

1.9yrs

Average Tenure

Experienced Management: MDI's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Age and Tenure

6.8yrs

Average Tenure

55yo

Average Age

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


Insider Trading

Insider Buying: MDI insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyCA$27,25811 Oct 19
Kimberly Keating
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares4,200
Max PriceCA$6.49
BuyCA$9,49305 Mar 19
David Tennant
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares2,000
Max PriceCA$4.78
BuyCA$31,03214 Jan 19
David Tennant
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares7,000
Max PriceCA$4.44
BuyCA$11,25227 Dec 18
Louis-Pierre Gignac
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,500
Max PriceCA$4.52
BuyCA$34,84114 Dec 18
Louis-Pierre Gignac
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares7,500
Max PriceCA$4.72

Ownership Breakdown

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


Management Team

  • Denis Larocque (49yo)

    President

    • Tenure: 4.3yrs
    • Compensation: CA$909.56k
  • David Balser

    Senior Advisor

    • Tenure: 0yrs
    • Compensation: CA$448.83k
  • Kelly Johnson

    Senior Vice President of Operations for North America & Africa

    • Tenure: 1.3yrs
    • Compensation: CA$589.38k
  • Ben Graham

    Vice President of Human Resources & Safety

    • Tenure: 4.1yrs
    • Compensation: CA$453.45k
  • Marc Landry

    Vice President Technology & Logistics

    • Tenure: 0.9yrs
  • Andrew McLaughlin

    VP of Legal Affairs

    • Tenure: 4.1yrs
  • JR Davies

    Vice President of Operations - Asia

    • Tenure: 1.9yrs
    • Compensation: CA$583.03k
  • Ian Ross

    Chief Financial Officer

    • Tenure: 0.8yrs
    • Compensation: CA$187.61k

Board Members

  • Sybil Veenman (55yo)

    Director

    • Tenure: 0yrs
  • Louis-Pierre Gignac (68yo)

    Independent Director

    • Tenure: 1.3yrs
    • Compensation: CA$48.71k
  • Jo Zurel (55yo)

    Independent Director

    • Tenure: 12.9yrs
    • Compensation: CA$109.75k
  • Janice Rennie (62yo)

    Independent Director

    • Tenure: 9.3yrs
    • Compensation: CA$114.75k
  • David Tennant (63yo)

    Independent Chairman of the Board

    • Tenure: 14.8yrs
    • Compensation: CA$183.75k
  • John Burzynski (55yo)

    Independent Director

    • Tenure: 1.3yrs
    • Compensation: CA$48.71k
  • Denis Larocque (49yo)

    President

    • Tenure: 4.3yrs
    • Compensation: CA$909.56k
  • Ed Breiner (63yo)

    Independent Director

    • Tenure: 13.5yrs
    • Compensation: CA$109.42k
  • Kim Keating (46yo)

    Independent Director

    • Tenure: 0.3yrs

Company Information

Major Drilling Group International Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Major Drilling Group International Inc.
  • Ticker: MDI
  • Exchange: TSX
  • Founded: 1980
  • Industry: Diversified Metals and Mining
  • Sector: Materials
  • Market Cap: CA$470.903m
  • Shares outstanding: 80.63m
  • Website: https://www.majordrilling.com

Number of Employees


Location

  • Major Drilling Group International Inc.
  • 111 St. George Street
  • Suite 100
  • Moncton
  • New Brunswick
  • E1C 1T7
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MDITSX (The Toronto Stock Exchange)YesCommon SharesCACADMar 1995
3MJDB (Deutsche Boerse AG)YesCommon SharesDEEURMar 1995
MJDL.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDMar 1995

Biography

Major Drilling Group International Inc. provides contract drilling services for mining and mineral exploration companies in Canada, the United States, Mexico, South America, Asia, Africa, and Europe. It of ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/09 23:40
End of Day Share Price2019/12/09 00:00
Earnings2019/10/31
Annual Earnings2019/04/30


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.