AutoCanada Inc. (TSE:ACQ)
TSX:ACQ
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AutoCanada
(TSX:ACQ)
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Rating:46Neutral
Price Target:
C$21.00
▼(-3.58% Downside)
Action:Reiterated
Date:05/15/26
The score is held back primarily by weak financial quality—negative TTM operating/free cash flow, very high leverage, and very thin margins amid weakening revenue. The earnings call provides some support through a defined recovery plan and expected divestiture-driven debt reduction, but near-term EBITDA pressure and execution risk remain. Technical signals are mixed-to-weak and valuation is only moderate with no dividend support.
Positive Factors
Collision business resilience
Collision is a less cyclical, higher‑margin service line; growth, OEM certifications and targeted M&A (Modern Autobody) expand scale and insurer relationships. This diversifies revenue away from volatile new/used sales and supports sustained aftermarket cash generation over 12–36 months.
Negative Factors
Very high leverage
Debt levels near 4x equity materially constrain strategic flexibility in a cyclical retail business. High leverage amplifies refinancing and covenant risk, limits capacity for opportunistic investments or M&A, and raises the stakes for execution as margins remain thin over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Collision business resilience
Collision is a less cyclical, higher‑margin service line; growth, OEM certifications and targeted M&A (Modern Autobody) expand scale and insurer relationships. This diversifies revenue away from volatile new/used sales and supports sustained aftermarket cash generation over 12–36 months.
Read all positive factors
AutoCanada (ACQ) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$497.04M
Dividend YieldN/A
Average Volume (3M)41.14K
Price to Earnings (P/E)24.2
Beta (1Y)1.63
Revenue Growth-6.30%
EPS GrowthN/A
CountryCA
Employees2,550
SectorConsumer Cyclical
Sector Strength84
IndustryAuto - Dealerships
Share Statistics
EPS (TTM)1.07
Shares Outstanding23,150,232
10 Day Avg. Volume43,249
30 Day Avg. Volume41,142
Financial Highlights & Ratios
PEG Ratio-0.28
Price to Book (P/B)1.19
Price to Sales (P/S)0.11
P/FCF Ratio9.95
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$21.33Price Target Upside-2.05% Downside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)2.03
Revenue Forecast (FY)C$4.83B
AutoCanada Business Overview & Revenue Model
Company Description
AutoCanada Inc., through its subsidiaries, operates franchised automobile dealerships. The company offers a range of automotive products and services, including new and used vehicles, vehicle leasing, vehicle parts, vehicle maintenance and collisi...
How the Company Makes Money
AutoCanada primarily makes money through multiple dealership-based revenue streams: (1) New vehicle sales: Revenue is generated from selling new vehicles sourced from original equipment manufacturers (OEMs) under franchise agreements. Profit is dr...
AutoCanada Earnings Call Summary
Earnings Call Date:May 13, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Neutral
The call conveyed a balanced view: near-term operating and macro challenges resulted in a meaningful year-over-year EBITDA decline and pressured used vehicle profitability, offset by signs of operational stabilization, early sequential improvements (March/April), strategic balance sheet actions (cash proceeds and credit facility extension), continued collision growth and targeted M&A. Management laid out clear priorities and initiatives to restore margins and rebuild productivity, but acknowledged that significant work remains and that parts of the recovery (new vehicles, fixed ops) will take longer.Positive Updates
Adjusted EBITDA and Context
Adjusted EBITDA from continuing operations of $31.0M in Q1 FY2026 versus $43.0M in the prior year (a decline of $12.0M, or approximately -27.9%). Management described these results as largely as expected given the macro environment and noted early operational progress late in the quarter and into April.
Negative Updates
Material EBITDA Decline
Adjusted EBITDA fell to $31.0M from $43.0M year-over-year, a decline of $12.0M (≈ -27.9%). Management acknowledged results are below long-term expectations and included a $5.0M forfeiture of share-based compensation tied to departing executives within that amount.
Read all updates
Q1-2026 Updates
Positive
Negative
Adjusted EBITDA and Context
Adjusted EBITDA from continuing operations of $31.0M in Q1 FY2026 versus $43.0M in the prior year (a decline of $12.0M, or approximately -27.9%). Management described these results as largely as expected given the macro environment and noted early operational progress late in the quarter and into April.
Read all positive updates
Company Guidance
The company guided that 2026 will be a transitional year for dealerships and a growth year for collision, with Q1 adjusted EBITDA from continuing operations of $31.0 million (down from $43.0 million a year ago and including a $5.0 million forfeiture of share‑based compensation), used vehicle gross profit per unit of negative $48 in Q1 but expected to improve sequentially (Q2 > Q1) and normalize in the second half with a near‑term target of roughly $1,000 GPU, and new/parts/service recovery taking about 9–12 months (with an overall turnaround horizon of 12–18 months into late 2027); collision was down ~ $2.5 million year‑over‑year due to a difficult hail comparison and three new centers ramping (hail revenue was roughly $8M in Q1 last year vs ~$1M this year), collision remains a core growth focus with targeted accretive M&A, and the company has received ~$65.8M of gross U.S. divestiture proceeds to date (expecting ~ $130M total, with a big chunk this summer and the remainder in the fall) to be used primarily for debt reduction, alongside an amended syndicated credit facility extended to 2028 and capital priorities of debt paydown, high‑return operational investments, selective collision acquisitions and opportunistic share repurchases.AutoCanada Financial Statement Overview
Summary
Income Statement
42
Neutral
Balance Sheet
30
Negative
Cash Flow
24
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.85B | 4.90B | 5.35B | 6.44B | 6.04B | 4.65B |
| Gross Profit | 553.93M | 330.10M | 882.28M | 479.23M | 1.04B | 834.18M |
| EBITDA | 148.83M | 178.34M | 164.34M | 217.30M | 235.04M | 309.87M |
| Net Income | 24.74M | 16.03M | -68.23M | 50.49M | 85.44M | 164.21M |
Balance Sheet | ||||||
| Total Assets | 2.85B | 2.75B | 3.01B | 3.16B | 2.86B | 2.26B |
| Cash, Cash Equivalents and Short-Term Investments | 133.48M | 87.96M | 67.34M | 103.15M | 108.30M | 102.48M |
| Total Debt | 2.02B | 1.89B | 2.01B | 2.23B | 2.03B | 1.45B |
| Total Liabilities | 2.38B | 2.26B | 2.51B | 2.59B | 2.37B | 1.74B |
| Stockholders Equity | 449.60M | 460.48M | 468.03M | 534.85M | 457.90M | 493.41M |
Cash Flow | ||||||
| Free Cash Flow | -175.11M | 54.89M | -2.45M | 40.02M | 95.31M | 78.37M |
| Operating Cash Flow | -136.68M | 81.12M | 31.63M | 119.53M | 147.97M | 112.94M |
| Investing Cash Flow | 25.38M | 47.99M | 67.86M | -125.43M | -228.02M | -215.37M |
| Financing Cash Flow | 136.85M | -120.19M | -93.92M | 183.60M | 83.21M | 97.00M |
AutoCanada Technical Analysis
Negative
21.78
Price Trends
21.12
Positive
23.72
Negative
25.64
Negative
Market Momentum
-0.02
Positive
44.68
Neutral
34.94
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ACQ, the sentiment is Negative. The current price of 21.78 is below the 20-day moving average (MA) of 22.55, above the 50-day MA of 21.12, and below the 200-day MA of 25.64, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 44.68 is Neutral, neither overbought nor oversold. The STOCH value of 34.94 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ACQ.
AutoCanada Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | C$5.70B | 5.79 | 10.37% | 1.32% | 2.38% | 149.43% | |
71 Outperform | C$23.15B | -328.99 | 5.42% | 3.69% | 0.29% | -40.45% | |
69 Neutral | C$281.98M | 12.39 | 6.05% | 6.21% | -2.28% | -7.56% | |
69 Neutral | C$746.73M | 6.02 | 7.74% | 1.93% | -1.63% | ― | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | C$3.95B | -158.49 | 1.74% | 0.28% | 8.97% | 7.15% | |
46 Neutral | C$497.04M | 24.24 | 5.29% | ― | -6.30% | ― |
* Consumer Cyclical Sector Average
TSE:ACQ
AutoCanada
21.47
1.12
5.50%
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AutoCanada Corporate Events
Business Operations and StrategyFinancial DisclosuresM&A Transactions
AutoCanada Advances U.S. Exit With Sale of Hyundai of Lincolnwood
Positive
Apr 13, 2026
AutoCanada has completed the sale of Hyundai of Lincolnwood in Illinois, part of its previously classified discontinued U.S. operations, receiving about $3.3 million in cash for goodwill and fixed assets, excluding inventory and working capital. P...
Business Operations and Strategy
AutoCanada Strikes National Digital Advertising Deal With AutoTrader.ca
Positive
Apr 1, 2026
AutoCanada has finalized a national advertising partnership with AutoTrader.ca, Canada’s largest automotive marketplace, creating a unified marketplace strategy across its dealership network. The agreement is designed to deliver consistent i...
Business Operations and StrategyFinancial DisclosuresM&A Transactions
AutoCanada Sells Kia of Lincolnwood as It Accelerates Exit From U.S. Market
Neutral
Mar 26, 2026
AutoCanada has completed the sale of its Kia of Lincolnwood dealership in Illinois, which generated $53 million in sales but a net loss of $1.6 million in 2025. The $13.4 million in cash proceeds, including $6.3 million for real estate, will be us...
Business Operations and StrategyFinancial Disclosures
AutoCanada Q4 Profitability Squeezed as Market Softens and Transformation Weighs
Negative
Mar 19, 2026
AutoCanada reported fourth-quarter 2025 revenue from continuing operations of $1.12 billion, down 11.8% year over year, with gross profit, adjusted EBITDA and per-unit margins all declining amid softer demand and normalizing vehicle pricing. The c...
Business Operations and StrategyFinancial Disclosures
AutoCanada Sets March 18 Date to Unveil Q4 2025 Financial Results
Neutral
Feb 27, 2026
AutoCanada plans to release its financial results for the quarter ended December 31, 2025 on March 18, 2026 after markets close. Management will host a same-day conference call and webcast at 4:00 p.m. Mountain Time to present prepared remarks and...
Business Operations and StrategyExecutive/Board Changes
AutoCanada Confirms Samuel Cochrane as CEO to Drive Operational Overhaul
Positive
Feb 18, 2026
AutoCanada has appointed Samuel Cochrane as its Chief Executive Officer, confirming the leadership role he had held on an interim basis since late 2025 while also continuing as Interim Chief Financial Officer during the search for a permanent fina...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.