Acadian Timber (ADN) AI Stock Analysis

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Acadian Timber

(TSX:ADN)

Rating:75Outperform

Price Target:

C$20.00

▲( 11.73% Upside)

Acadian Timber's overall stock score reflects strong financial health and an attractive valuation, balanced by mixed technical indicators and operational challenges. The company's financial stability and strategic initiatives, particularly in Maine, position it well despite revenue growth hurdles. The solid governance from the recent board election further supports the company's strategic direction, resulting in a moderate outlook.

Acadian Timber (ADN) vs. iShares MSCI Canada ETF (EWC)

Market Cap

C$320.09M

Dividend Yield6.48%

Average Volume (3M)5.97K

Price to Earnings (P/E)16.3

Beta (1Y)0.36

Revenue Growth12.30%

EPS Growth-36.60%

CountryCA

Employees195

SectorBasic Materials

Sector Strength63

IndustryPaper, Lumber & Forest Products

Share Statistics

EPS (TTM)0.21

Shares Outstanding17,822,449

10 Day Avg. Volume6,170

30 Day Avg. Volume5,971

Financial Highlights & Ratios

PEG Ratio-1.47

Price to Book (P/B)0.93

Price to Sales (P/S)0.00

P/FCF Ratio11.77

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$19.00

Price Target Upside6.15% Upside

Rating ConsensusHold

Number of Analyst Covering1

Acadian Timber Business Overview & Revenue Model

Company DescriptionAcadian Timber Corp. supplies primary forest products in Eastern Canada and the Northeastern United States. The company operates through two segments, NB Timberlands and Maine Timberlands. Its products include softwood and hardwood sawlogs, pulpwood, and biomass by-products. The company owns and manages approximately 1.1 million acres of freehold timberlands in New Brunswick and Maine; and provides timber services relating to approximately 1.3 million acres of Crown licensed timberlands in New Brunswick. Acadian Timber Corp. is headquartered in New Brunswick, Canada.

How the Company Makes MoneyAcadian Timber generates revenue primarily through the sale of timber harvested from its extensive land holdings. The company's key revenue streams include the direct sale of softwood and hardwood logs to regional sawmills and other wood processing facilities. These logs are used in the production of lumber, pulp, and other wood-based products. Acadian Timber also benefits from long-term supply agreements with key customers, which provide a stable and predictable revenue base. Additionally, the company may engage in land management activities, including the sale or lease of land for recreational or conservation purposes, which can contribute to its earnings. Acadian's focus on sustainable forestry practices ensures the long-term productivity and value of its timberlands, supporting ongoing revenue generation.

Acadian Timber Financial Statement Overview

Summary

Acadian Timber demonstrates strong financial performance with robust profitability and cash flow generation. While revenue growth is a challenge, the company maintains a strong balance sheet with effective cost management, positioning it well to manage operations and leverage growth opportunities.

Income Statement

Positive

Acadian Timber's income statement reflects a stable financial performance. The gross profit margin is consistently healthy, and the TTM (Trailing-Twelve-Months) shows a slight decline in total revenue compared to the previous annual period, indicating a revenue growth challenge. However, the company maintains a strong net profit margin, demonstrating effective cost management.

Balance Sheet

Positive

The balance sheet of Acadian Timber is robust with a solid equity base, indicated by a favorable equity ratio. The debt-to-equity ratio is manageable, reflecting moderate leverage levels which suggest financial stability. The return on equity is commendable, showcasing effective utilization of shareholders' funds.

Cash Flow

Very Positive

Acadian Timber exhibits a strong cash flow position with positive operating and free cash flows, which are critical for sustaining operations and funding future investments. The TTM data indicates consistent cash flow generation, supporting the company's liquidity and operational efficiency.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
112.21M	116.19M	93.48M	90.47M	95.73M	91.03M
	Gross Profit
35.07M	38.27M	29.22M	27.58M	30.80M	30.13M
	EBIT
20.48M	23.66M	19.57M	17.86M	21.76M	32.83M
	EBITDA
30.90M	34.63M	43.56M	52.51M	29.69M	35.86M
	Net Income Common Stockholders
19.37M	21.74M	29.43M	35.51M	18.68M	22.08M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.63M	15.25M	1.83M	6.23M	7.32M	10.26M
	Total Assets
607.98M	608.02M	567.95M	547.84M	516.64M	513.40M
	Total Debt
116.05M	114.94M	105.52M	107.94M	100.89M	101.19M
	Net Debt
111.42M	99.69M	103.68M	101.71M	93.57M	90.93M
	Total Liabilities
268.27M	268.99M	248.97M	244.11M	225.16M	220.16M
	Stockholders Equity
339.71M	339.03M	318.98M	303.72M	291.49M	293.24M
Cash Flow		Free Cash Flow
26.98M	34.05M	9.79M	14.86M	15.90M	20.27M
	Operating Cash Flow
27.89M	34.05M	10.41M	15.23M	16.23M	20.62M
	Investing Cash Flow
-8.79M	-9.14M	56.00K	-319.00K	186.00K	32.00K
	Financing Cash Flow
-8.22M	-11.49M	-14.87M	-16.00M	-19.36M	-17.99M

Acadian Timber Technical Analysis

Technical Analysis Sentiment

Positive

Last Price17.90

Price Trends

50DMA

17.24

Positive

100DMA

17.17

Positive

200DMA

17.12

Positive

Market Momentum

MACD

0.21

Negative

RSI

65.97

Neutral

STOCH

88.23

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ADN, the sentiment is Positive. The current price of 17.9 is above the 20-day moving average (MA) of 17.48, above the 50-day MA of 17.24, and above the 200-day MA of 17.12, indicating a bullish trend. The MACD of 0.21 indicates Negative momentum. The RSI at 65.97 is Neutral, neither overbought nor oversold. The STOCH value of 88.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ADN.

Acadian Timber Peers Comparison

Overall Rating

UnderperformOutperform

Sector (50)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ADN	75 Outperform	C$320.09M	16.27	5.85%	6.48%	12.30%	-36.60%
Sector *	50 Neutral	$1.98B	-1.07	-21.34%	3.71%	2.03%	-30.65%
ICLTF		$64.93M	―	-16.05%	―	―	―
WEF	59 Neutral	C$129.87M	―	-1.51%	―	9.47%	85.29%
CFF	53 Neutral	C$15.70M	―	-24.89%	―	-7.32%	10.08%
IFSPF		$480.20M	―	-16.90%	―	―	―
CFPZF		$1.14B	―	-18.19%	―	―	―

* Basic Materials Sector Average

Performance Comparison

TSE:ADN

Acadian Timber

17.88

1.50

9.16%

ICLTF

GreenFirst Forest Products

2.85

-0.80

-21.92%

TSE:CFF

Conifex Timber

0.37

-0.18

-32.73%

TSE:WEF

Western Forest Prod

0.40

-0.10

-20.00%

IFSPF

Interfor

9.01

-4.47

-33.16%

CFPZF

Canfor

9.37

-2.00

-17.59%

Acadian Timber Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q1-2025)

% Change Since: 2.76%|

Next Earnings Date:Jul 23, 2025

Earnings Call Sentiment Neutral

The earnings call reflects mixed results with significant progress in sales volume growth and internal operations in Maine, but is overshadowed by declines in revenue, pricing, and profitability metrics. The company's financial position remains strong, but operational challenges and market conditions create a cautious outlook.

Q1-2025 Updates

Positive Updates

Increased Sales Volume

Both timber sales volumes from timberlands and timber services activity increased compared to the same period in the prior year. Timber sales and services revenue increased by $1 million year-over-year, with timber sales volume, excluding biomass, increasing 3%.

Biomass Sales Volume Surge

Biomass sales volumes doubled compared to Q1 2024.

New Brunswick Operations Growth

Sales for New Brunswick timberlands were $22.1 million compared to $19.1 million during the prior year period. Sales volume, excluding biomass, increased 15% due to strong demand for sawlogs.

Establishment of Internal Logging Operations in Maine

Acadian established internal logging operations in Maine to address limited contractor availability. This includes purchasing harvesting equipment and acquiring additional logging assets for a total cash consideration of $6.9 million.

Strong Financial Position

Acadian ended the quarter with a net liquidity position of $17.6 million, including cash balances and undrawn revolving credit facilities. Long-term debt totaling $46 million was refinanced at a rate of 5.25%.

Negative Updates

Decreased Revenue

Acadian generated sales of $24.8 million compared to $28.8 million in the prior year period, largely due to no carbon credit sales in the first quarter of 2025.

Decline in Pricing

Pricing for softwood sawlogs and hardwood sawlogs decreased by 10% and 8%, respectively. The overall weighted average selling price, excluding biomass, decreased 5% compared to the same quarter last year.

Adjusted EBITDA and Margin Decline

Adjusted EBITDA for the first quarter was $4.7 million compared to $10.6 million in the prior year period. Adjusted EBITDA margin for the quarter was 19% compared to 37%.

Challenges in Maine Operations

Sales during the first quarter in Maine totaled $2.8 million compared to $4.8 million in the same period last year. Timber sales volume, excluding biomass, decreased 44% due to reduced contractor capacity and unfavorable weather conditions.

Negative EBITDA in Maine

Adjusted EBITDA for Maine was negative $700,000 compared to $1.2 million in the prior year period, with an adjusted EBITDA margin of negative 24% compared to 24%.

Company Guidance

During the Acadian Timber's first quarter 2025 conference call, the company provided guidance for the remainder of the year, highlighting several key metrics and operational strategies. Acadian experienced a decrease in sales to $24.8 million from $28.8 million in the prior year, primarily due to the absence of carbon credit sales, which contributed $4.9 million in Q1 2024. Timber sales and services revenue increased by $1 million year-over-year, with timber sales volume increasing by 3%, despite a 5% decrease in the weighted average selling price, excluding biomass. The company faced challenges such as unfavorable weather and limited contractor capacity in Maine, leading to a 44% decrease in timber sales volume in that region. However, new internal logging operations in Maine are expected to increase production capacity and reduce costs over 2025. Adjusted EBITDA dropped to $4.7 million from $10.6 million, with a margin decrease from 37% to 19%. Acadian maintained a net liquidity position of $17.6 million and refinanced $46 million of long-term debt at a rate of 5.25%. Looking forward, the company anticipates stable demand for softwood sawlogs and potential pricing increases for hardwood sawlogs, while near-term demand for pulpwood may remain subdued. The registration of additional carbon credits is expected to be completed in Q2, with further real estate and renewable energy investments planned throughout the year.

Acadian Timber Corporate Events

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy

Acadian Timber Corp. Elects New Board of Directors

Positive

May 9, 2025

Acadian Timber Corp. announced the election of its board of directors during the 2025 Annual Meeting of Shareholders. The election results showed strong support for the nominees, with each receiving over 99% of the votes. This election is a key aspect of Acadian’s governance, ensuring continued strategic oversight as the company pursues its business strategy of sustainable forest management and asset growth.

Business Operations and StrategyFinancial Disclosures

Acadian Timber Corp. Reports Stable Q1 2025 Results Amid Operational Shifts

Neutral

May 7, 2025

Acadian Timber Corp. reported stable regional demand and pricing for its products in the first quarter of 2025, despite economic uncertainties. The company faced challenges in delivery due to warm weather and contractor availability in Maine. To address these issues, Acadian established its own logging operations in Maine, purchasing equipment and assets to reduce reliance on external contractors, which is expected to enhance production capacity and reduce costs. The company generated $24.8 million in sales, with a solid balance sheet showing $17.6 million in net liquidity.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.