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Algoma Central Corp (TSE:ALC)
TSX:ALC

Algoma Central (ALC) AI Stock Analysis

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Algoma Central

(TSX:ALC)

Rating:69Neutral
Price Target:
C$17.50
▲( 10.34% Upside)
Algoma Central receives a moderately favorable score due to its robust valuation and strategic initiatives that should drive future growth. However, revenue growth challenges and cash flow issues present risks. The company's strong market position and recent corporate developments provide a positive outlook, though careful monitoring of financial metrics is needed.

Algoma Central (ALC) vs. iShares MSCI Canada ETF (EWC)

Algoma Central Business Overview & Revenue Model

Company DescriptionAlgoma Central Corporation (ALC) is a leading Canadian shipping company specializing in the transportation of bulk commodities. The company operates a fleet of vessels that traverse the Great Lakes, St. Lawrence Waterway, and coastal areas, providing essential marine transportation services. Algoma Central's core services include the transportation of dry-bulk cargoes such as iron ore, grain, and coal, catering primarily to industrial and agricultural sectors.
How the Company Makes MoneyAlgoma Central Corporation generates revenue through its marine transportation services. The primary revenue streams include freight rates charged for the transportation of dry-bulk commodities across its network of routes in the Great Lakes and St. Lawrence Waterway. The company also engages in long-term contracts and spot market opportunities to optimize fleet utilization and maximize earnings. Strategic partnerships with major industrial and agricultural clients, as well as investments in fleet modernization and efficiency, contribute significantly to its profitability. Algoma Central's financial performance is influenced by factors such as commodity demand, fuel prices, and regulatory changes impacting the shipping industry.

Algoma Central Financial Statement Overview

Summary
Algoma Central demonstrates solid profitability and a stable financial position with a strong equity base. However, recent declines in revenue and negative free cash flow due to high capital expenditures are concerns that need addressing.
Income Statement
70
Positive
Algoma Central's income statement shows stable revenue with a slight decline in recent periods. The TTM data indicates a gross profit margin of 51.05% and a net profit margin of 12.21%, reflecting healthy profitability. However, the revenue growth rate is negative due to a slight decline from the previous year, which is a concern. EBIT and EBITDA margins are strong, indicating efficient operational performance.
Balance Sheet
65
Positive
The balance sheet indicates a solid equity base with a debt-to-equity ratio of 0.69, suggesting manageable leverage levels. The return on equity is 9.76%, which is reasonable but could be improved. The equity ratio of 51.28% shows a healthy capital structure. However, the increase in total debt over the period is a potential risk if not managed properly.
Cash Flow
60
Neutral
Cash flow analysis highlights negative free cash flow in the TTM period, primarily due to high capital expenditures. The operating cash flow to net income ratio is 1.86, indicating strong cash generation relative to net income. However, the free cash flow trajectory and investment in capital expenditures might need careful monitoring to ensure future liquidity.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
701.43M703.44M721.22M677.94M598.87M545.66M
Gross Profit
358.18M632.09M655.17M612.51M531.02M470.51M
EBIT
68.02M75.14M74.53M102.30M93.31M74.09M
EBITDA
140.39M147.21M140.15M186.26M162.72M154.53M
Net Income Common Stockholders
85.61M91.64M82.87M84.47M63.77M45.85M
Balance SheetCash, Cash Equivalents and Short-Term Investments
36.30M3.54M32.83M141.97M108.94M103.91M
Total Assets
1.71B1.52B1.34B1.37B1.20B1.22B
Total Debt
602.41M412.59M377.37M402.79M392.22M391.15M
Net Debt
566.11M409.04M344.54M260.82M283.27M287.25M
Total Liabilities
833.40M624.11M565.85M639.67M559.80M662.48M
Stockholders Equity
876.84M899.85M778.31M726.02M640.28M560.62M
Cash FlowFree Cash Flow
-80.86M-10.22M4.96M62.26M130.50M81.87M
Operating Cash Flow
159.52M155.39M124.21M133.13M162.38M157.06M
Investing Cash Flow
-265.97M-183.75M-127.78M-65.87M-16.23M-87.19M
Financing Cash Flow
128.68M-5.55M-105.76M-42.37M-141.02M16.32M

Algoma Central Technical Analysis

Technical Analysis Sentiment
Positive
Last Price15.86
Price Trends
50DMA
15.12
Positive
100DMA
14.83
Positive
200DMA
14.55
Positive
Market Momentum
MACD
0.26
Negative
RSI
61.52
Neutral
STOCH
41.54
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ALC, the sentiment is Positive. The current price of 15.86 is above the 20-day moving average (MA) of 15.50, above the 50-day MA of 15.12, and above the 200-day MA of 14.55, indicating a bullish trend. The MACD of 0.26 indicates Negative momentum. The RSI at 61.52 is Neutral, neither overbought nor oversold. The STOCH value of 41.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ALC.

Algoma Central Peers Comparison

Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSSIS
79
Outperform
C$1.37B27.388.74%2.77%5.24%11.02%
TSMTL
77
Outperform
C$1.23B11.4410.81%5.69%3.28%-14.21%
TSGDI
76
Outperform
C$774.77M20.367.93%1.49%152.09%
TSWJX
73
Outperform
C$506.73M12.368.09%5.98%-2.65%-47.65%
TSWTE
73
Outperform
C$1.64B14.7415.75%5.65%11.00%13.78%
TSALC
69
Neutral
C$643.41M7.4910.37%4.85%-2.42%-4.60%
65
Neutral
$4.41B12.065.22%249.80%4.09%-12.16%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:ALC
Algoma Central
15.86
2.39
17.74%
TSE:WJX
Wajax Corporation
23.42
-1.04
-4.25%
TSE:WTE
Westshore Terminals
26.54
4.67
21.35%
TSE:GDI
GDI Integrated
32.90
1.62
5.18%
TSE:SIS
Savaria
19.19
1.77
10.16%
TSE:MTL
Mullen Group
14.05
1.77
14.41%

Algoma Central Corporate Events

Business Operations and Strategy
Algoma Central Unveils New Strategic Initiative
Positive
May 5, 2025

Algoma Central has announced a significant development in its operations, which is expected to impact its industry positioning and stakeholder interests. The company has introduced a new initiative aimed at enhancing its operational efficiency and market competitiveness, signaling a strategic move to strengthen its presence in the industry.

Business Operations and StrategyFinancial Disclosures
Algoma Central Corporation Reports First Quarter 2025 Financial Results Amid Fleet Expansion
Neutral
May 2, 2025

Algoma Central Corporation reported a net loss of $23,280 for the first quarter of 2025, compared to a net loss of $17,253 in the same period in 2024, amid global economic uncertainties. The company emphasized its commitment to fleet improvements and strategic growth, highlighted by the delivery of four new vessels within the quarter. Despite a decline in revenues across several segments due to increased dry-docking, Algoma’s core performance remained strong, with stable equity earnings in the Global Short Sea Shipping segment. The company’s diversified portfolio and ongoing investments in fleet enhancements are expected to support its long-term vision and operational resilience.

Product-Related AnnouncementsBusiness Operations and Strategy
Algoma Central and Irving Oil Expand Fleet with New Tanker Vessels
Positive
Apr 28, 2025

Algoma Central Corporation and Irving Oil have introduced the first of two new product tankers, the Algoma East Coast, into Saint John Harbour, with the Algoma Acadian to follow later this spring. These vessels, representing a $127 million investment, will enhance Algoma’s operational capabilities and expand its market reach, while supporting Irving Oil’s energy distribution in Atlantic Canada and the U.S. East Coast. This strategic collaboration underscores both companies’ commitment to energy security and operational excellence, with the vessels designed to meet unique operational requirements and optimize energy product distribution.

Shareholder MeetingsFinancial Disclosures
Algoma Central Announces 2025 Annual General Meeting and Financial Results Release
Neutral
Apr 11, 2025

Algoma Central Corporation has announced its 2025 Annual General Meeting of Shareholders, scheduled for May 2, 2025, in Toronto, Ontario. The meeting will also coincide with the release of the company’s financial results for the first quarter of 2025, which will be reviewed during the event. Shareholders are encouraged to vote in advance, and the meeting materials are available on the company’s website.

Business Operations and StrategyFinancial Disclosures
Algoma Central Corporation Reports Strong Fiscal 2024 Results and Optimistic Outlook for 2025
Positive
Feb 27, 2025

Algoma Central Corporation reported strong financial results for fiscal 2024, with net earnings increasing to $91,638 from $82,870 in 2023, despite a slight decline in overall revenue. The company experienced growth in its Ocean Self-Unloaders and Product Tankers segments, driven by increased fleet utilization and expanded capacity. Looking ahead to 2025, Algoma plans to introduce nine new vessels and anticipates stability and growth, although it remains cautious of potential market disruptions.

Business Operations and StrategyFinancial Disclosures
Algoma Central Reports Strong Fiscal 2024 Results Amid Market Growth
Positive
Feb 27, 2025

Algoma Central Corporation reported strong financial results for fiscal 2024, driven by renewed market demand and expanded capacity. The company achieved higher net earnings and EBITDA compared to the previous year, despite a slight decrease in overall revenue. The Ocean Self-Unloaders and Product Tankers segments showed significant growth, with increased operating earnings and fleet utilization. Looking forward to 2025, Algoma remains optimistic yet cautious, anticipating stability and growth with the introduction of nine new vessels, while being mindful of potential market disruptions.

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.