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ATS Corporation (TSE:ATS)
TSX:ATS

ATS Corporation (ATS) AI Stock Analysis

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ATS Corporation

(TSX:ATS)

Rating:54Neutral
Price Target:
C$41.00
▲(2.76%Upside)
The overall stock score for ATS Corporation is impacted significantly by financial performance challenges, including declining revenues, increased leverage, and cash flow constraints. Technical analysis offers a slightly positive outlook with some bullish momentum, but valuation concerns due to negative P/E and lack of dividend yield weigh heavily. While strong order bookings and sector-specific growth are positive signs, they are not sufficient to offset existing financial and valuation risks.

ATS Corporation (ATS) vs. iShares MSCI Canada ETF (EWC)

ATS Corporation Business Overview & Revenue Model

Company DescriptionATS Corporation, together with its subsidiaries, provides automation solutions worldwide. The company is also involved in the planning, designing, building, commissioning, and servicing automated manufacturing and assembly systems, including automation products and test solutions. It offers enterprise solutions in the areas of project management; partners/suppliers/vendors team selection and coordination; facility layouts and operational design; business case development and project justification; post project service, spare parts, and support; and system design, built, integration, commissioning, validation, training and start up. In addition, the company offers pre-automation services comprising discovery and analysis, concept development, simulation, and total cost of ownership modelling; post automation services, including training, process optimization, preventative maintenance, emergency and on-call support, spare parts, retooling, retrofits, and equipment relocation; and contract manufacturing services. Further, it provides engineering design, prototyping, process verification, specification writing, software and manufacturing process controls development, standard automation products/platforms, equipment design and build, third-party equipment qualification, procurement and integration, automation system installation, product line commissioning, validation, and documentation services. The company serves life sciences, transportation, consumer products, food and beverage, and energy markets. The company was formerly known as ATS Automation Tooling Systems Inc. and changed its name to ATS Corporation in November 2022. ATS Corporation was founded in 1978 and is headquartered in Cambridge, Canada.
How the Company Makes MoneyATS Corporation generates revenue through the sale of its automation systems and related services. Key revenue streams include the design, development, and installation of custom automation solutions tailored to specific industry applications. Additionally, ATS offers ongoing maintenance and support services, as well as retrofitting and upgrading existing systems to improve performance. The company also engages in strategic partnerships and collaborations with technology providers and industry leaders to enhance its offerings and expand market reach. These partnerships, along with a focus on innovation and customer satisfaction, contribute significantly to ATS's earnings.

ATS Corporation Earnings Call Summary

Earnings Call Date:May 28, 2025
(Q4-2025)
|
% Change Since: -4.84%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. While ATS demonstrated strong order bookings and growth in the life sciences and energy sectors, it faced challenges with declining revenues and geopolitical uncertainties. The EV settlement provides some financial relief, but the transportation segment continues to be a concern.
Q4-2025 Updates
Positive Updates
Record Order Bookings
Order bookings for the fourth quarter were $863 million, up 9% from the fourth quarter last year. Full-year bookings reached $3.3 billion, a record for ATS.
Strong Life Sciences Performance
Life sciences businesses demonstrated strength, ending the quarter with an order backlog of $1.2 billion, supported by diverse bookings in areas such as auto-injector assembly, radiopharma, and wearables.
Improved Gross Margin
Excluding acquisition-related charges, the gross margin for Q4 was 29%, a 90 basis point improvement from last year.
EV Settlement
The company announced a settlement with an EV customer, expecting to receive USD 134.75 million, which will reduce net debt to adjusted EBITDA leverage by 0.5x.
Strong Energy Sector Prospects
The energy sector shows strong growth potential with ongoing CANDU refurbishment projects and opportunities in nuclear fuel and small modular reactors.
Negative Updates
Decline in Adjusted Revenues
Q4 adjusted revenues were $721 million, down 9% from Q4 last year. Full-year adjusted revenues were 12% lower year-over-year due to decreased EV revenues.
Challenges in Transportation
The transportation segment remained a drag on earnings, with lower revenue volumes impacting margins.
Geopolitical and Trade Tensions
The macroeconomic environment is marked by geopolitical and trade tensions, creating uncertainty that could impact demand.
Company Guidance
During the ATS Corporation Fourth Quarter Conference Call, the company highlighted several key metrics and provided guidance for fiscal 2026. Order bookings for the fourth quarter reached $863 million, marking a 9% increase year-over-year, with full-year bookings hitting a record $3.3 billion. Despite facing a 9% decline in fourth-quarter adjusted revenues to $721 million, the company's order backlog ended at a robust $2.1 billion, the highest in eight quarters. The trailing 12-month book-to-bill ratio stood at 1.23:1, indicating a strong pipeline. Although geopolitical and trade tensions pose risks, ATS remains optimistic about growth prospects, particularly in regulated markets like life sciences, which closed the quarter with a $1.2 billion backlog. The company is also focused on expanding its market reach and optimizing its supply chain to support margins. Looking ahead, ATS anticipates first-quarter fiscal 2026 revenues between $680 million to $730 million, supported by ongoing improvements in operational efficiency and strategic customer relationships.

ATS Corporation Financial Statement Overview

Summary
ATS Corporation faces significant financial challenges, with declining revenues, increased leverage, and cash flow constraints. These factors indicate a need for strategic adjustments to stabilize operations and improve financial health. The current trajectory poses risks, especially in maintaining liquidity and profitability.
Income Statement
55
Neutral
The company experienced a significant drop in revenue and profitability in the most recent year. The gross profit margin decreased from 28.2% to 25.5%, and the net profit margin turned negative, indicating a net loss. The EBIT and EBITDA margins also declined sharply, reflecting operational challenges. Despite past growth, recent financial performance suggests instability.
Balance Sheet
65
Positive
The company's debt-to-equity ratio increased, suggesting higher leverage which could pose a risk in a volatile market. However, the equity ratio remains stable, indicating a balanced asset structure. Return on equity has deteriorated due to the net loss, reducing shareholder returns.
Cash Flow
50
Neutral
Operating cash flow remains positive but is insufficient to cover capital expenditures, leading to a negative free cash flow. The free cash flow to net income ratio is negative, highlighting cash flow challenges. This could impact financial flexibility if not addressed.
BreakdownMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue2.53B3.03B2.58B2.18B1.43B
Gross Profit646.65M855.50M725.81M612.43M384.26M
EBITDA167.97M458.54M349.94M302.54M192.15M
Net Income-28.05M193.74M127.43M122.10M64.09M
Balance Sheet
Total Assets4.62B4.09B3.54B3.07B2.20B
Cash, Cash Equivalents and Short-Term Investments225.95M170.18M159.87M135.28M187.47M
Total Debt1.70B1.29B1.26B1.10B504.78M
Total Liabilities2.91B2.40B2.41B2.08B1.28B
Stockholders Equity1.71B1.68B1.13B981.60M895.26M
Cash Flow
Free Cash Flow-52.26M-67.68M47.50M162.90M153.59M
Operating Cash Flow25.77M20.78M127.80M216.16M185.16M
Investing Cash Flow-268.44M-341.98M-109.02M-797.47M-88.13M
Financing Cash Flow290.28M330.92M4.88M531.53M-259.12M

ATS Corporation Technical Analysis

Technical Analysis Sentiment
Negative
Last Price39.90
Price Trends
50DMA
39.97
Negative
100DMA
38.80
Positive
200DMA
40.22
Negative
Market Momentum
MACD
0.31
Positive
RSI
40.77
Neutral
STOCH
7.61
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ATS, the sentiment is Negative. The current price of 39.9 is below the 20-day moving average (MA) of 42.39, below the 50-day MA of 39.97, and below the 200-day MA of 40.22, indicating a bearish trend. The MACD of 0.31 indicates Positive momentum. The RSI at 40.77 is Neutral, neither overbought nor oversold. The STOCH value of 7.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ATS.

ATS Corporation Peers Comparison

Overall Rating
UnderperformOutperform
Sector (71)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
71
Outperform
¥254.47B13.178.49%3.06%6.31%13.07%
TSATS
54
Neutral
C$3.95B38.53-1.66%-16.47%-114.85%
$508.46M-37.81%
TSSIS
77
Outperform
C$1.40B27.908.74%2.76%5.24%11.02%
59
Neutral
C$20.38M-7.92%-12.65%-838.74%
TSVLN
52
Neutral
C$312.77M-46.86%0.83%-1.54%-290.52%
TSPYR
47
Neutral
C$90.54M-5701.32%14.45%76.75%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:ATS
ATS Corporation
39.90
-5.60
-12.31%
BLDP
Ballard Power Systems
1.95
-0.53
-21.37%
TSE:PYR
PyroGenesis Canada
0.46
-0.55
-54.46%
TSE:REKO
Reko International
3.70
-0.54
-12.74%
TSE:SIS
Savaria
19.70
1.97
11.11%
TSE:VLN
Velan Inc. SV
14.00
8.10
137.29%

ATS Corporation Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
ATS Corporation Announces CEO Departure and Interim Leadership
Neutral
Jul 7, 2025

ATS Corporation announced the departure of CEO Andrew Hider, who will leave by the end of August to pursue opportunities outside the automation industry. Ryan McLeod, the current CFO, will serve as interim CEO while the board searches for a permanent replacement. Under Hider’s leadership, ATS experienced significant growth and implemented the ATS Business Model, positioning the company well for future success. The company’s outlook for the fiscal year remains unchanged.

The most recent analyst rating on (TSE:ATS) stock is a Buy with a C$65.00 price target. To see the full list of analyst forecasts on ATS Corporation stock, see the TSE:ATS Stock Forecast page.

Business Operations and Strategy
ATS Corporation to Engage Investors at Stifel 2025 Conference
Neutral
May 29, 2025

ATS Corporation announced that its CEO, Andrew Hider, and CFO, Ryan McLeod, will participate in the Stifel 2025 Cross Sector Insight Conference in Boston on June 3, 2025. This participation includes hosting institutional investor meetings, highlighting ATS’s commitment to engaging with investors and showcasing its industry-leading automation solutions.

The most recent analyst rating on (TSE:ATS) stock is a Buy with a C$68.00 price target. To see the full list of analyst forecasts on ATS Corporation stock, see the TSE:ATS Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
ATS Corporation Reports Fiscal 2025 Results Amid EV Settlement Impact
Neutral
May 28, 2025

ATS Corporation reported its financial results for the fourth quarter and fiscal year 2025, highlighting a challenging period marked by a significant EV customer settlement impacting revenues and net income. Despite these challenges, the company saw a strong performance in order bookings and backlog, indicating positive future revenue visibility and a strategic focus on growth as it enters fiscal 2026.

The most recent analyst rating on (TSE:ATS) stock is a Buy with a C$68.00 price target. To see the full list of analyst forecasts on ATS Corporation stock, see the TSE:ATS Stock Forecast page.

Legal ProceedingsBusiness Operations and StrategyFinancial Disclosures
ATS Corporation Settles with EV Customer and Reports Preliminary Q4 2025 Results
Neutral
May 24, 2025

ATS Corporation has reached a settlement agreement with an electric vehicle customer, resolving outstanding payments with a $134.75 million payment expected in the first quarter of fiscal 2026. This settlement allows ATS to focus on its growth strategy in regulated markets, despite a reduction in net income by $129 million due to the agreement. Preliminary financial results for the fourth quarter of fiscal 2025 show revenues of $721 million and a net loss of $68.9 million, with adjusted net income of $40 million.

The most recent analyst rating on (TSE:ATS) stock is a Buy with a C$58.00 price target. To see the full list of analyst forecasts on ATS Corporation stock, see the TSE:ATS Stock Forecast page.

Business Operations and Strategy
ATS Corporation to Engage with Investors at RBC Capital Markets Conference
Neutral
Apr 14, 2025

ATS Corporation announced that its Chief Financial Officer, Ryan McLeod, will participate in the RBC Capital Markets Canadian Industrials Conference in Toronto on May 15, 2025. This participation underscores ATS’s commitment to engaging with institutional investors and highlights its strategic positioning in the industrial automation sector.

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.Date of analysis: Jul 08, 2025