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Market Cap

CA$8.6b

Last Updated

2021/05/07 22:17 UTC

Data Sources

Company Financials +

Executive Summary

Air Canada provides domestic, U.S. transborder, and international airline services. More Details


Snowflake Analysis

High growth potential and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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

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


Market Performance


7 Day Return

0.6%

AC

0.8%

CA Airlines

1.9%

CA Market


1 Year Return

46.2%

AC

115.7%

CA Airlines

36.9%

CA Market

Return vs Industry: AC underperformed the Canadian Airlines industry which returned 126.2% over the past year.

Return vs Market: AC exceeded the Canadian Market which returned 37.1% over the past year.


Shareholder returns

ACIndustryMarket
7 Day0.6%0.8%1.9%
30 Day-9.9%-8.1%2.2%
90 Day13.9%13.5%8.3%
1 Year46.2%46.2%115.9%115.7%41.4%36.9%
3 Year4.9%4.9%3.8%1.6%30.1%17.7%
5 Year165.4%165.4%38.3%33.0%60.1%36.2%

Long-Term Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

30.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AC (CA$24.92) is trading below our estimate of fair value (CA$36.08)

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


Price To Earnings Ratio

PE vs Industry: AC is unprofitable, so we can't compare its PE Ratio to the XX Airlines industry average.

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


Price to Book Ratio

PB vs Industry: AC is overvalued based on its PB Ratio (4.8x) compared to the CA Airlines industry average (2x).


Future Growth

How is Air Canada forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

75.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AC is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.5%).

Earnings vs Market: AC is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: AC's is expected to become profitable in the next 3 years.

Revenue vs Market: AC's revenue (25.4% per year) is forecast to grow faster than the Canadian market (7.3% per year).

High Growth Revenue: AC's revenue (25.4% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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


Past Performance

How has Air Canada performed over the past 5 years?

-53.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AC is currently unprofitable.

Growing Profit Margin: AC is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: AC is unprofitable, and losses have increased over the past 5 years at a rate of 53.2% per year.

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

Earnings vs Industry: AC is unprofitable, making it difficult to compare its past year earnings growth to the Airlines industry (-26.2%).


Return on Equity

High ROE: AC has a negative Return on Equity (-270.96%), as it is currently unprofitable.


Financial Health

How is Air Canada's financial position?


Financial Position Analysis

Short Term Liabilities: AC's short term assets (CA$8.7B) exceed its short term liabilities (CA$7.1B).

Long Term Liabilities: AC's short term assets (CA$8.7B) do not cover its long term liabilities (CA$20.1B).


Debt to Equity History and Analysis

Debt Level: AC's debt to equity ratio (547.7%) is considered high.

Reducing Debt: AC's debt to equity ratio has reduced from 26483.6% to 547.7% over the past 5 years.

Debt Coverage: AC's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: Insufficient data to determine if AC's interest payments on its debt are well covered by EBIT.


Balance Sheet


Dividend

What is Air Canada current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

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

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


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

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


Next Steps

Management

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

3.8yrs

Average management tenure


CEO

Mike Rousseau (62 yo)

0.25

Tenure

CA$4,396,500

Compensation

Mr. Michael Stewart Rousseau, also known as Mike, has been Chief Executive Officer and President of Air Canada, a subsidiary of Ace Aviation Holdings Inc. since February 15, 2021. He had been Chief Financi...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD3.61M) is about average for companies of similar size in the Canadian market ($USD3.81M).

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


Leadership Team

Experienced Management: AC's management team is considered experienced (3.8 years average tenure).


Board Members

Experienced Board: AC's board of directors are considered experienced (6 years average tenure).


Ownership

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


Insider Trading Volume

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


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 37%.


Top Shareholders

Company Information

Air Canada's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Air Canada
  • Ticker: AC
  • Exchange: TSX
  • Founded: 1937
  • Industry: Airlines
  • Sector: Transportation
  • Market Cap: CA$8.642b
  • Shares outstanding: 357.72m
  • Website: https://www.aircanada.com

Number of Employees


Location

  • Air Canada
  • 7373 Côte Vertu Boulevard West
  • Saint-Laurent
  • Quebec
  • H4Y 1H4
  • Canada

Listings


Biography

Air Canada provides domestic, U.S. transborder, and international airline services. It offers scheduled passenger services under the Air Canada Vacations and Air Canada Rouge brand name in the Canadian mar...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/05/07 22:17
End of Day Share Price2021/05/07 00:00
Earnings2021/03/31
Annual Earnings2020/12/31


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.