CAE (CAE) AI Stock Analysis

• Market Cap: C$12.73B
• Dividend Yield: N/A
• Average Volume (3M): 704.81K
• Price to Earnings (P/E): 30.6
• Beta (1Y): 0.91
• Revenue Growth: 8.04%
• EPS Growth: N/A
• Country: CA
• Employees: 13,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 0.21
• Shares Outstanding: 320,726,230
• 10 Day Avg. Volume: 1,197,808
• 30 Day Avg. Volume: 704,812
• PEG Ratio: -0.12
• Price to Book (P/B): 2.31
• Price to Sales (P/S): 2.40
• P/FCF Ratio: 24.95
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$44.17
• Price Target Upside: 11.26% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 73 Outperform
• Price Target: C$41.00 ▲(3.27% Upside)

CAE's overall stock score is driven by strong financial performance and a positive outlook in the Defense segment. Technical analysis and valuation present mixed signals, with the stock trading at a premium and showing bearish momentum. The earnings call highlights both opportunities and challenges, particularly in the Civil segment. Continued focus on cash flow conversion and operational efficiencies will be key to sustaining growth.

Positive Factors

Negative Factors

CAE Business Overview & Revenue Model

Company Description

CAE Inc., together with its subsidiaries, provides simulation training and critical operations support solutions worldwide. It operates through three segments: Civil Aviation, Defense and Security, and Healthcare. The Civil Aviation segment provides training solutions for flight, cabin, maintenance, and ground personnel in commercial, business, and helicopter aviation; flight simulation training devices; and ab initio pilot training and crew sourcing services, as well as end to end digitally enabled crew management, training operations solutions, and optimization software. The Defense and Security segment offers training and mission support solutions for defense forces across multi-domain operations, OEMs, government agencies and public safety organizations. The Healthcare segment provides integrated education and training solutions, including interventional and imaging simulations, curricula, audiovisual debriefing solutions, center management platforms, and patient simulators for healthcare students and clinical professionals, hospital and university simulation centers, medical and nursing schools, paramedic organizations, defense forces, medical societies, public health agencies and OEMs. The company was formerly known as CAE Industries Ltd. and changed its name to CAE Inc. in 1993. CAE Inc. was incorporated in 1947 and is headquartered in Saint-Laurent, Canada.

How the Company Makes Money

CAE generates revenue through multiple streams, primarily by offering simulation-based training solutions and services to airlines, military organizations, and healthcare providers. Key revenue streams include the sale of flight simulators and training devices, training services provided to pilots and crew members, and maintenance services for simulation equipment. Additionally, CAE partners with various airlines and defense organizations to deliver customized training programs, further enhancing its revenue potential. The company's contracts with government agencies and commercial entities also contribute significantly to its earnings, ensuring a steady flow of income from long-term agreements and service contracts.

CAE Financial Statement Overview

Summary

CAE demonstrates strong financial health with impressive revenue growth and profitability. The company has effectively managed its leverage, maintaining a stable balance sheet. While cash flow generation is robust, the recent decline in free cash flow growth warrants attention. Continued focus on improving cash flow conversion and managing debt levels will be crucial for sustaining growth and financial stability.

Income Statement

CAE's income statement shows strong performance with a significant revenue growth rate of 55.4% in the TTM period, indicating robust expansion. The company maintains healthy margins with a gross profit margin of 28.1% and an EBIT margin of 15.6%, reflecting operational efficiency. The net profit margin of 8.7% is solid, showcasing profitability. However, the previous year's negative EBIT and net income highlight past challenges.

Balance Sheet

The balance sheet is stable with a manageable debt-to-equity ratio of 0.69, indicating a balanced approach to leveraging. The return on equity of 8.8% in the TTM period is commendable, showing effective use of equity. However, the equity ratio of 45.1% suggests a moderate reliance on debt financing, which could pose risks if not managed carefully.

Cash Flow

Cash flow analysis reveals a slight decline in free cash flow growth by 4.5% in the TTM period, which could be a concern for future liquidity. The operating cash flow to net income ratio of 2.16 indicates strong cash generation relative to net income. However, the free cash flow to net income ratio of 0.49 suggests room for improvement in converting profits into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.73B	4.71B	4.28B	4.01B	3.37B	2.98B
Gross Profit	1.33B	1.30B	1.15B	1.08B	955.50M	765.00M
EBITDA	1.04B	915.70M	785.70M	693.60M	552.30M	446.90M
Net Income	414.20M	405.30M	-304.00M	222.70M	141.70M	-47.20M
Balance Sheet
Total Assets	10.88B	11.21B	9.83B	10.44B	9.58B	8.75B
Cash, Cash Equivalents and Short-Term Investments	171.20M	293.70M	160.10M	217.60M	346.10M	926.10M
Total Debt	3.41B	3.47B	3.07B	3.25B	3.05B	2.35B
Total Liabilities	5.89B	6.24B	5.53B	5.85B	5.49B	5.54B
Stockholders Equity	4.91B	4.89B	4.22B	4.51B	4.01B	3.14B
Cash Flow
Free Cash Flow	441.90M	452.40M	126.30M	-16.90M	55.40M	203.00M
Operating Cash Flow	894.10M	896.50M	566.90M	408.40M	418.20M	366.60M
Investing Cash Flow	-744.30M	-732.30M	-215.40M	-400.70M	-2.24B	-343.40M
Financing Cash Flow	-132.10M	-49.80M	-395.30M	-152.60M	1.26B	-21.30M

CAE Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 39.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CAE, the sentiment is Positive. The current price of 39.7 is above the 20-day moving average (MA) of 37.59, above the 50-day MA of 38.33, and above the 200-day MA of 36.03, indicating a bullish trend. The MACD of 0.44 indicates Negative momentum. The RSI at 65.09 is Neutral, neither overbought nor oversold. The STOCH value of 79.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CAE.

CAE Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FTG	75 Outperform	297.80M	20.85	15.52%	―	17.52%	54.86%
CAE	73 Outperform	C$12.73B	30.62	8.73%	―	8.04%	―
MDA	68 Neutral	4.26B	35.86	8.94%	―	57.21%	136.79%
BBD.B	65 Neutral	19.23B	30.35	-28.41%	―	6.69%	64.89%
BBD.A	64 Neutral	19.23B	30.57	-28.35%	―	6.69%	64.89%
MAL	64 Neutral	933.07M	24.50	4.71%	0.92%	6.58%	121.23%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

CAE Corporate Events

CAE Announces 2025 Board of Directors Election Results

CAE announced the election results for its Board of Directors at the 2025 Annual and Special Meeting of Shareholders, with 13 nominees successfully elected. This outcome reinforces CAE’s leadership structure as it continues to focus on delivering excellence in training and simulation solutions, thereby strengthening its position in the aviation and defense industries.

The most recent analyst rating on (TSE:CAE) stock is a Buy with a C$33.00 price target. To see the full list of analyst forecasts on CAE stock, see the TSE:CAE Stock Forecast page.

CAE Inc. Reports Strong Q1 Fiscal 2026 Results and Announces Leadership Transition

CAE Inc. reported a solid first quarter for fiscal 2026, with revenue of $1,098.6 million and an EPS of $0.18, reflecting growth from the previous year. The company announced leadership changes with Matthew Bromberg set to succeed Marc Parent as President and CEO, and Calin Rovinescu becoming Executive Chairman. The results highlight CAE’s strong performance in both civil and defense sectors, and the company is poised to capitalize on future opportunities with a focus on operational excellence and shareholder value.

The most recent analyst rating on (TSE:CAE) stock is a Buy with a C$33.00 price target. To see the full list of analyst forecasts on CAE stock, see the TSE:CAE Stock Forecast page.