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Chorus Aviation V&VV (TSE:CHR)
TSX:CHR

Chorus Aviation (CHR) AI Stock Analysis

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Chorus Aviation

(TSX:CHR)

Rating:52Neutral
Price Target:
C$20.00
▼(-4.12%Downside)
Chorus Aviation's stock score is primarily influenced by its resilience in cash flow management and leverage reduction amidst challenging profitability. Technical indicators present a cautious outlook, and valuation remains a concern due to a negative P/E ratio. Corporate events like share buybacks and strong quarterly results provide some optimism, but ongoing improvements in profitability and financial stability are critical for enhancing the stock's appeal.
Positive Factors
Earnings and Cash Flows
The company's capacity purchase agreement with Air Canada and the growing Voyageur business provide visibility into earnings and cash flows.
Revenue Streams
CHR going forward benefits from two largely contracted, predictable and stable revenue streams.
Negative Factors
Financial Performance
Q1/25 results were generally better than expectations, and mark a new era for the company.
Free Cash Flow
Free cash flow usage of $28.9m came in well below the positive $8.1m forecast, driven by higher-than-anticipated working capital draw.

Chorus Aviation (CHR) vs. iShares MSCI Canada ETF (EWC)

Chorus Aviation Business Overview & Revenue Model

Company DescriptionChorus Aviation Inc. is a Canadian holding company with subsidiaries involved in regional aviation services. With headquarters in Halifax, Nova Scotia, the company operates primarily through its regional airline, Jazz Aviation, and its aircraft leasing segment, Chorus Aviation Capital. Chorus provides a comprehensive range of services to the aviation sector, including contract flying, leasing, and maintenance, repair, and overhaul (MRO) services.
How the Company Makes MoneyChorus Aviation generates revenue through multiple streams. A significant portion comes from its capacity purchase agreements with Air Canada, under which its subsidiary, Jazz Aviation, operates flights on behalf of Air Canada under the Air Canada Express brand. This agreement ensures a steady flow of income based on the capacity provided rather than passenger load factors. Additionally, Chorus Aviation earns revenue from its aircraft leasing business through its subsidiary, Chorus Aviation Capital, which leases aircraft to regional airlines worldwide. The company also derives income from providing MRO services, which include aircraft maintenance and engineering solutions. These diversified revenue streams, along with strategic partnerships and a global presence in the aircraft leasing market, contribute to Chorus Aviation's overall financial performance.

Chorus Aviation Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q3-2024)
|
% Change Since: 9.16%|
Next Earnings Date:Aug 05, 2025
Earnings Call Sentiment Positive
The earnings call highlighted Chorus' strong financial performance, including improved leverage ratios, significant free cash flow, and growth in Voyageur's revenues. However, the reclassification of the RAL segment as discontinued operations and the downward trend in aircraft maintenance expenses were noted as challenges. Overall, the positive developments, such as contract extensions and safety recognitions, outweigh the lowlights.
Q3-2024 Updates
Positive Updates
Strengthened Financial Position
Chorus improved its leverage ratio to 3.0, down from 3.3 at the beginning of the year, and expects further improvement following the closure of the RAL segment sale.
Strong Free Cash Flow and Adjusted EBITDA
Generated over $32 million in free cash flow this quarter and reported adjusted EBITDA of almost $54 million for Q3 and $159 million year-to-date.
Successful Contract Extensions and New Partnerships
Extended six Q400 CPA aircraft leases with Air Canada to 2026 and launched a new pilot training program with Cygnet Aviation.
Voyageur's Revenue Growth
Voyageur's revenues increased by 16% year-to-date, reaching $90 million, with record parts sales contributing to this growth.
Recognition for Safety Excellence
Jazz was recognized as an award of Excellence Winner for the eighth consecutive year as part of Canada's Safest Employers.
Negative Updates
Discontinued Operations and Segment Sale
The RAL segment has been reclassified to discontinued operations as Chorus plans to sell it by the end of 2024.
Aircraft Maintenance Expense Trends
Aircraft maintenance materials, supplies, and services expenses have been trending down, with no clear seasonality or significant read-through.
Company Guidance
During the Chorus Third Quarter 2024 earnings call, the company provided detailed guidance on its financial performance and strategic initiatives. The call highlighted a significant focus on the sale of the Regional Aircraft Leasing (RAL) segment, which is expected to conclude by the end of 2024. This transaction will lead to a streamlined balance sheet, with a pro forma leverage ratio projected to decrease to 1.5 from 3.0, enabling better financial flexibility. Chorus reported an adjusted EBITDA of $54 million for the quarter and $159 million year-to-date, alongside a free cash flow of $32 million. On a pro forma basis, free cash flow for the quarter was $37 million, illustrating a robust financial position post-transaction. The company is also committed to enhancing shareholder value through a normal course issuer bid (NCIB) for share repurchases. Operationally, Chorus emphasized its strong contractual relationship with Air Canada, extending leases on six Q400 CPA aircraft to 2026, and highlighted growth at Voyageur with record parts sales and revenue up 16% year-over-year. The call underscored Chorus' focus on capital structure optimization, pilot recruitment advancements, and strengthening its regional aviation services.

Chorus Aviation Financial Statement Overview

Summary
Chorus Aviation shows resilience in managing cash flows and optimizing leverage amidst revenue challenges. Despite widening net losses, the focus on maintaining a strong cash position and reducing leverage is commendable. Continued efforts in cost management and revenue growth are essential for future financial health.
Income Statement
45
Neutral
Chorus Aviation's revenue contracted slightly in the TTM period compared to the previous year. The gross profit margin reduced to 16.02% in TTM from 19.28% the previous year, indicating increased pressure on costs or pricing. The net loss widened in TTM, leading to a negative net profit margin of -10.64%, compared to the previous year's -11.28%. While EBIT margin showed resilience at 6.77% for TTM, EBITDA margin improved to 12.84%. The visible trend is a struggle to maintain profitability amidst fluctuating revenue.
Balance Sheet
55
Neutral
The balance sheet reflects a decrease in total assets and liabilities over time. The debt-to-equity ratio stands at 0.81 in TTM, an improvement from 1.01 the previous year, suggesting a reduction in leverage. However, the equity ratio decreased to 36.43% from 31.85%, indicating relative stability in equity financing. Overall, the financial stability appears moderate with a cautious approach to debt management.
Cash Flow
65
Positive
The company's operating cash flow to net income ratio is strong at -1.01, reflecting robust cash generation capabilities despite net losses. The free cash flow was positive at $108.5 million, although it decreased compared to the previous year's $212.1 million. The free cash flow growth rate is negative due to this decline. Cash flow management seems effective despite the challenges in profitability.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
1.39B1.40B1.40B1.60B1.02B948.72M
Gross Profit
223.40M270.89M441.60M423.40M205.63M230.12M
EBIT
94.39M92.65M158.53M188.27M70.98M114.55M
EBITDA
179.05M165.54M271.36M360.85M270.46M363.12M
Net Income Common Stockholders
-148.39M-158.50M101.35M48.89M-20.48M41.49M
Balance SheetCash, Cash Equivalents and Short-Term Investments
74.35M222.22M88.83M100.03M123.57M165.72M
Total Assets
1.42B1.61B3.85B4.06B3.18B3.34B
Total Debt
418.44M516.38M1.76B2.03B1.91B2.19B
Net Debt
344.09M294.16M1.67B1.93B1.79B2.03B
Total Liabilities
900.62M1.10B2.57B2.79B2.49B2.70B
Stockholders Equity
516.22M511.95M1.19B1.18B690.47M641.34M
Cash FlowFree Cash Flow
108.50M212.13M256.51M217.23M110.26M-249.50M
Operating Cash Flow
149.43M265.02M299.68M279.51M184.97M156.64M
Investing Cash Flow
724.75M818.67M37.56M-231.37M-45.74M-407.59M
Financing Cash Flow
-992.42M-1.06B-325.55M-71.46M-180.93M334.56M

Chorus Aviation Technical Analysis

Technical Analysis Sentiment
Positive
Last Price20.86
Price Trends
50DMA
19.50
Positive
100DMA
19.78
Positive
200DMA
20.36
Positive
Market Momentum
MACD
0.40
Negative
RSI
64.60
Neutral
STOCH
58.58
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CHR, the sentiment is Positive. The current price of 20.86 is above the 20-day moving average (MA) of 20.46, above the 50-day MA of 19.50, and above the 200-day MA of 20.36, indicating a bullish trend. The MACD of 0.40 indicates Negative momentum. The RSI at 64.60 is Neutral, neither overbought nor oversold. The STOCH value of 58.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CHR.

Chorus Aviation Peers Comparison

Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSAC
73
Outperform
$6.53B3.96132.28%0.24%-23.10%
73
Outperform
$9.86B27.52-18.58%16.31%4.12%
TSDXT
72
Outperform
C$556.11M17.6915.03%3.96%-10.24%-23.79%
TSEIF
70
Outperform
C$2.92B21.979.16%4.57%5.95%-1.42%
66
Neutral
$4.49B12.345.40%248.65%4.13%-12.33%
TSCHR
52
Neutral
C$551.77M-0.09%-17.58%-703.93%
49
Neutral
C$683.62M-37.81%-29.66%-67.02%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:CHR
Chorus Aviation
21.01
5.26
33.40%
TSE:DXT
Dexterra Group
8.75
3.58
69.25%
TSE:BLDP
Ballard Power Systems
2.28
-1.53
-40.16%
TSE:AC
Air Canada
19.15
1.48
8.38%
TSE:BBD.B
Bombardier
104.11
15.19
17.08%
TSE:EIF
Exchange Income
57.77
14.96
34.95%

Chorus Aviation Corporate Events

Stock Buyback
Chorus Aviation Resumes Share Repurchase with New Plan
Neutral
May 27, 2025

Chorus Aviation Inc. has initiated an automatic share purchase plan (ASPP) to facilitate the repurchase of its Class A and Class B shares under its normal course issuer bid (NCIB), which had been suspended during a substantial issuer bid. The ASPP allows Chorus to buy shares during trading blackout periods, with the plan reviewed by the Toronto Stock Exchange. This move is expected to optimize the company’s capital structure and potentially enhance shareholder value, although there is no assurance on the number of shares to be acquired.

The most recent analyst rating on (TSE:CHR) stock is a Buy with a C$21.00 price target. To see the full list of analyst forecasts on Chorus Aviation stock, see the TSE:CHR Stock Forecast page.

Stock Buyback
Chorus Aviation Completes Substantial Issuer Bid and Plans to Resume Share Purchases
Neutral
May 22, 2025

Chorus Aviation Inc. announced the final results of its substantial issuer bid, purchasing 471,319 shares at $21.00 per share for approximately $9.9 million. This move represents about 1.78% of its outstanding shares, and the company plans to resume its normal course issuer bid, continuing share purchases opportunistically until November 2025.

The most recent analyst rating on (TSE:CHR) stock is a Buy with a C$21.00 price target. To see the full list of analyst forecasts on Chorus Aviation stock, see the TSE:CHR Stock Forecast page.

Stock Buyback
Chorus Aviation Announces Preliminary Results of Share Buyback
Neutral
May 21, 2025

Chorus Aviation Inc. announced the preliminary results of its substantial issuer bid, aiming to purchase and cancel up to $25 million of its shares. The company successfully tendered 471,319 shares at $21.00 each, representing approximately 1.78% of its outstanding shares. Following this transaction, Chorus will have 25,992,518 shares remaining. The issuer bid was less than the maximum allowed, so all validly tendered shares will be purchased without proration. The company plans to resume its normal course issuer bid, purchasing shares opportunistically until November 2025.

The most recent analyst rating on (TSE:CHR) stock is a Buy with a C$21.00 price target. To see the full list of analyst forecasts on Chorus Aviation stock, see the TSE:CHR Stock Forecast page.

Stock BuybackRegulatory Filings and Compliance
Chorus Aviation Secures Regulatory Approval for Potential Extension of Share Buyback Offer
Neutral
May 15, 2025

Chorus Aviation Inc. announced that it has received exemptive relief from the Nova Scotia Securities Commission, allowing it to extend its substantial issuer bid if undersubscribed, without needing to first purchase shares already tendered. This move is part of Chorus’s offer to buy back up to $25 million worth of its Class A and Class B shares through a modified Dutch auction. The decision to extend the offer has not yet been made, but it could impact the company’s financial strategy and shareholder value.

The most recent analyst rating on (TSE:CHR) stock is a Buy with a C$21.00 price target. To see the full list of analyst forecasts on Chorus Aviation stock, see the TSE:CHR Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Chorus Aviation Announces Board of Directors Election Results
Positive
May 7, 2025

Chorus Aviation Inc. announced the election results for its Board of Directors during its virtual annual meeting of shareholders on May 7, 2025. The meeting saw 11,754,727 shares represented, accounting for 43.92% of the company’s voting shares, with all business items receiving approval. The election results highlight the continued support for the company’s leadership, which could positively impact its operational strategies and stakeholder confidence.

Stock BuybackBusiness Operations and StrategyFinancial Disclosures
Chorus Aviation Reports Strong Q1 2025 Results and Focuses on Shareholder Value
Positive
May 6, 2025

Chorus Aviation Inc. reported a strong financial performance for the first quarter of 2025, with a net income of $18.9 million, up from $12.3 million in the same period of 2024. The company’s improved results were driven by the sale of its regional aircraft leasing business, increased parts sales, and cost reductions. Additionally, Chorus has been actively returning capital to shareholders through share buy-backs, reflecting its strengthened balance sheet and commitment to enhancing shareholder value.

Other
Jazz Aviation Celebrated as Top Employer in Nova Scotia for 14th Year
Positive
Apr 15, 2025

Jazz Aviation LP has been recognized as one of Nova Scotia’s Top Employers for the 14th consecutive year by Mediacorp Canada Inc. This accolade underscores Jazz’s dedication to fostering an exceptional work environment for its over 850 employees in Nova Scotia, reflecting its commitment to community involvement and employee development. The recognition is part of a series of accolades Jazz has received, highlighting its industry leadership and value creation for stakeholders.

Stock BuybackBusiness Operations and Strategy
Chorus Aviation Launches $25 Million Share Buyback Program
Positive
Apr 14, 2025

Chorus Aviation Inc. has initiated a substantial issuer bid to repurchase up to $25 million of its Class A and Class B shares. This move, conducted via a modified Dutch auction, allows shareholders to tender their shares within a specified price range. The initiative aims to optimize the company’s capital structure and potentially enhance shareholder value by reducing the number of outstanding shares.

Shareholder MeetingsFinancial Disclosures
Chorus Aviation to Announce Q1 2025 Results and Host Shareholder Meeting
Neutral
Apr 7, 2025

Chorus Aviation Inc. announced that it will present its first quarter 2025 financial results and hold its Annual Meeting of Shareholders on May 7, 2025. The presentation will be led by CEO Colin Copp and CFO Gary Osborne, providing insights into the company’s financial performance and strategic direction. This announcement is significant as it offers stakeholders an opportunity to engage with the company’s leadership and gain a deeper understanding of its operational and financial strategies.

Stock BuybackBusiness Operations and Strategy
Chorus Aviation Launches $25 Million Share Buyback
Positive
Apr 7, 2025

Chorus Aviation has announced a substantial issuer bid to purchase up to $25 million of its shares through a modified Dutch auction, allowing shareholders to tender their shares at specified prices. This move is seen as a strategic use of financial resources, reflecting the company’s belief that its current share price undervalues its business and future prospects, while maintaining sufficient capital for ongoing operations and growth opportunities.

Other
Jazz Aviation Celebrates 14th Year as Top Atlantic Canadian Employer
Positive
Mar 25, 2025

Jazz Aviation LP has been named one of Atlantic Canada’s Top Employers for the 14th consecutive year, underscoring its commitment to a positive workplace culture and employee support in the region. This accolade, awarded by Mediacorp Canada Inc., highlights Jazz’s dedication to collaboration, respect, and continuous improvement, further cementing its reputation as an employer of choice and enhancing its stakeholder value.

Business Operations and Strategy
Jazz Aviation Celebrates 14th Consecutive Year as Top Employer in Atlantic Canada
Positive
Mar 25, 2025

Jazz Aviation LP has been named one of Atlantic Canada’s Top Employers for the 14th consecutive year, underscoring its dedication to creating an exceptional workplace culture. This recognition reflects Jazz’s commitment to fostering a positive, inclusive, and innovative work environment for its over 900 employees in the region. The award, given by Mediacorp Canada Inc., evaluates employers on various criteria, including workplace environment, employee benefits, and community involvement, highlighting Jazz’s leadership in the industry and its value to stakeholders.

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.