ATS (NYSE:ATS – Get Free Report) issued its quarterly earnings data on Wednesday. The company reported $0.19 earnings per share for the quarter, missing the consensus estimate of $0.22 by ($0.03), Zacks reports. The business had revenue of $467.59 million during the quarter, compared to the consensus estimate of $477.49 million. ATS had a return on equity of 7.94% and a net margin of 0.28%. The business’s revenue for the quarter was down 8.6% compared to the same quarter last year. During the same period in the prior year, the firm earned $0.45 EPS.
Here are the key takeaways from ATS’s conference call:
- Bookings rose 12.7% year over year to CAD 827 million, and backlog reached approximately CAD 2 billion. Life sciences backlog hit a record CAD 1.2 billion, supported by radiopharma and medical-device orders, though management said longer project timelines mean the bookings will take time to convert into revenue.
- ATS no longer expects to achieve its fiscal 2027 goals for modest revenue growth and margin expansion, citing delayed orders, lower volumes and unfavorable mix. It forecast Q3 revenue of CAD 640 million to CAD 680 million and expects near-term margin pressure.
- The company is targeting CAD 65 million to CAD 75 million in annualized net savings from its Fixed Cost Transformation Program, with benefits expected to build as implementation continues over the next 15 months. Actions announced so far include facility closures and a workforce reduction of 300 to 400, while ATS says it is adding capacity in growth areas such as radiopharma.
- Section 338 tariffs delayed packaging-equipment orders from Canadian facilities to U.S. customers, but U.S. modifications announced in late October removed the tariffs from nearly all affected products. Management sees potential for orders to resume but did not quantify the timing or value.
- Net debt to adjusted EBITDA rose to 3.1 times, above ATS’s target range of two to three times, reflecting lower trailing EBITDA and CAD 61 million of share repurchases. The company expects to remain moderately above its target range for the rest of fiscal 2027, absent acquisitions or portfolio actions.
ATS Trading Down 1.9%
ATS stock traded down $0.33 during midday trading on Friday, hitting $16.99. The stock had a trading volume of 185,987 shares, compared to its average volume of 201,247. The company has a current ratio of 1.63, a quick ratio of 1.33 and a debt-to-equity ratio of 0.75. The business has a fifty day moving average price of $18.70 and a two-hundred day moving average price of $26.37. ATS has a 1-year low of $16.97 and a 1-year high of $35.82. The firm has a market cap of $1.63 billion, a P/E ratio of 339.93 and a beta of 1.15.
Analyst Ratings Changes
Several brokerages have commented on ATS. Wall Street Zen downgraded ATS from a “buy” rating to a “hold” rating in a report on Sunday, July 12th. Zacks Research raised ATS from a “strong sell” rating to a “hold” rating in a research note on Monday, October 19th. TD Securities downgraded ATS from a “buy” rating to a “hold” rating in a research report on Monday, August 10th. Finally, Weiss Ratings downgraded ATS from a “hold (c-)” rating to a “sell (d+)” rating in a research report on Friday, September 25th. Three investment analysts have rated the stock with a Buy rating, three have assigned a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, the company has a consensus rating of “Hold” and a consensus price target of $42.50.
Check Out Our Latest Stock Analysis on ATS
About ATS
ATS Corporation is a Canadian automation solutions provider headquartered in Cambridge, Ontario. The company designs, builds and services automated manufacturing systems, production equipment and related technologies for manufacturers in a range of industries.
Its offerings include custom automation systems, assembly and test equipment, material-handling solutions, packaging systems, precision components and aftermarket services. ATS also provides automation software, controls, engineering, technical support and lifecycle services intended to improve production efficiency, quality and flexibility.
The company serves customers in sectors including life sciences, transportation, energy, consumer products and industrial manufacturing.
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