Element Fleet Management (EFN) AI Stock Analysis

• Market Cap: $13.56B
• Dividend Yield: 1.55%
• Average Volume (3M): 573.93K
• Price to Earnings (P/E): 24.6
• Beta (1Y): 0.67
• Revenue Growth: 18.12%
• EPS Growth: 14.08%
• Country: CA
• Employees: 2,900
• Sector: Industrials
• Sector Strength: 84
• Industry: Rental & Leasing Services
• EPS (TTM): 0.38
• Shares Outstanding: 401,669,130
• 10 Day Avg. Volume: 520,929
• 30 Day Avg. Volume: 573,926
• PEG Ratio: 0.50
• Price to Book (P/B): 1.99
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 45.55
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 2.00
• Enterprise Value/Gross Profit: 21.66
• Enterprise Value/Ebitda: 3.01
• 1Y Price Target: $34.87
• Price Target Upside: 2.87% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 73 Outperform
• Price Target: C$37.00 ▲(9.14%Upside)

Element Fleet Management shows strong technical momentum and positive earnings call outcomes, which are significant strengths. However, high leverage and valuation concerns present risks. The company's strategic initiatives and corporate events contribute positively to its market positioning.

Positive Factors

Analyst Recommendations

Analyst recommends a buy rating for Element Fleet Management Corp., indicating a positive outlook for the company's stock.

Growth Potential

Element Fleet Management Corp. is reaffirmed as a steady 10% grower, showcasing consistent growth potential.

Revenue Growth

Higher servicing revenue, up 25% year-over-year, indicates strong performance in this segment.

Negative Factors

Operating Expenses

Higher opex, at US$127.5mm versus US$120.2mm estimate, up 16% year-over-year on accelerated strategic investments and additional expenses associated with AutoFleet acquisition.

Originations

Originations lower, at US$1.50B versus US$1.77B estimate, on seasonal factors including historically slower client order volume during summer months.

Revenue Challenges

Lower finance revenue and syndication revenue, along with higher operating expenses, present challenges despite growth in other areas.

Element Fleet Management Business Overview & Revenue Model

Company Description

Element Fleet Management Corp. operates as a fleet management company primarily in Canada, the United States, Mexico, Australia, and New Zealand. The company offers fleet management services comprising vehicle acquisition, financing, program management, and remarketing services to corporate, commercial, government, and public service vehicle fleets. It serves construction, energy, oil and gas, food and beverage, healthcare, services, transportation, and utility industries. Element Fleet Management Corp. is headquartered in Toronto, Canada.

How the Company Makes Money

Element Fleet Management makes money primarily through its fleet leasing and management services. The company generates revenue by leasing vehicles to clients and providing a range of value-added services that help manage and optimize fleet operations. Key revenue streams include leasing fees, service and maintenance fees, and fees from fuel management and telematics services. Additionally, Element Fleet Management earns revenue from vehicle remarketing, where they help clients sell their used vehicles. The company also benefits from strategic partnerships with automotive manufacturers, financial institutions, and technology providers, which enhance its service offerings and expand its market reach.

Element Fleet Management Financial Statement Overview

Summary

Element Fleet Management demonstrates strong profitability with robust margins. However, the company faces challenges in revenue growth and high leverage, indicated by a high debt-to-equity ratio. Cash flows are improving, but cash conversion efficiency remains a concern.

Income Statement

Element Fleet Management shows strong gross and net profit margins in the latest TTM, with a gross profit margin of 36.4% and a net profit margin of 17.8%. However, there is a negative revenue growth rate of -6.4% from the previous annual report, which is a concern. EBIT and EBITDA margins remain robust at 33.5% and 60.7% respectively, indicating efficient operations.

Balance Sheet

The company's balance sheet reflects a high debt-to-equity ratio of 3.32, suggesting significant leverage, which could pose risks. However, the return on equity is solid at 13.5%, and the equity ratio is fair at 20.7%, indicating a reasonable proportion of the assets are financed by equity.

Cash Flow

Cash flow analysis reveals a positive free cash flow growth rate from negative to positive, indicating improvement. However, the operating cash flow to net income ratio is low at 0.96, suggesting potential issues in converting income to cash. The free cash flow to net income ratio is 0.47, indicating moderate cash generation relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.06B	2.21B	1.99B	1.96B	1.66B	1.77B
Gross Profit	751.38M	783.96M	748.70M	809.16M	666.94M	660.34M
EBITDA	1.25B	1.13B	1.01B	1.16B	988.67M	1.22B
Net Income	367.99M	387.14M	466.20M	409.64M	279.22M	225.14M
Balance Sheet
Total Assets	13.15B	12.70B	16.47B	14.33B	12.97B	14.99B
Cash, Cash Equivalents and Short-Term Investments	497.96M	128.84M	96.42M	68.88M	45.27M	8.79M
Total Debt	9.02B	8.45B	8.13B	9.02B	8.20B	10.00B
Total Liabilities	10.43B	9.93B	12.57B	10.65B	9.52B	11.21B
Stockholders Equity	2.72B	2.77B	3.90B	3.68B	3.45B	3.78B
Cash Flow
Free Cash Flow	171.71M	-184.17M	-1.05B	160.77M	2.43B	2.68B
Operating Cash Flow	351.63M	-107.16M	-970.88M	229.63M	2.51B	2.78B
Investing Cash Flow	-140.45M	-157.84M	-74.90M	-65.61M	-85.95M	-9.62M
Financing Cash Flow	11.37M	454.82M	1.38B	-7.59M	-2.39B	-2.83B

Element Fleet Management Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 33.90
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EFN, the sentiment is Positive. The current price of 33.9 is above the 20-day moving average (MA) of 32.71, above the 50-day MA of 31.94, and above the 200-day MA of 29.42, indicating a bullish trend. The MACD of 0.48 indicates Negative momentum. The RSI at 69.64 is Neutral, neither overbought nor oversold. The STOCH value of 93.10 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:EFN.

Element Fleet Management Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EFN	73 Outperform	$13.56B	24.57	13.96%	1.55%	18.12%	14.08%
Sector *	67 Neutral	€8.19B	18.40	6.19%	2.76%	2.41%	-40.75%
STN		$12.23B	43.98	13.13%	0.59%	―	―
TFII		$7.36B	19.10	14.78%	2.06%	―	―
SNCAF		$11.85B	54.05	8.66%	0.09%	―	―
FTT	79 Outperform	C$7.57B	15.94	18.79%	2.93%	6.61%	1.87%
BBU		$2.24B	2.67	-1.19%	0.93%	―	―

Element Fleet Management Corporate Events

Element Fleet Management Advances Sustainability with 2025 Report

Element Fleet Management has released its 2025 Sustainability Report, highlighting significant progress in its climate strategy and transparency efforts. The report showcases achievements such as surpassing Scope 1 and 2 emission reduction targets, aligning decarbonization initiatives with global best practices, and enhancing sustainability governance and disclosure practices. Element’s commitment to sustainability is evident in its efforts to foster inclusion and belonging, and its dedication to continuous improvement positions the company for long-term resilience and shared prosperity.

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

Element Fleet Management Reports Strong Shareholder Support at Annual Meeting

Element Fleet Management announced the successful election of all ten nominees to its board of directors at the Annual Meeting of Shareholders, with a high voter turnout of over 86%. The company also reported strong shareholder support for executive compensation and the re-appointment of Ernst & Young LLP as independent auditors. This outcome reflects robust shareholder engagement and confidence in Element’s strategic direction, reinforcing its position as a leading player in the automotive fleet management industry.

Element Fleet Management Achieves Strong Q1 2025 Results Amid Market Challenges

Element Fleet Management Corp. reported a solid performance in the first quarter of 2025, demonstrating financial and operational resilience despite uncertain market conditions. The company achieved a 5% year-over-year growth in net revenues across all categories, with an 8% increase when excluding certain items from the previous year. The adjusted operating margin expanded by 125 basis points, and the company maintained a strong return on equity of 16.7%. Element effectively managed global trade tensions, maintained a resilient client order volume, and repurchased 2.2 million common shares, reinforcing its commitment to delivering shareholder value.

Element Fleet Management Announces Board Nominations and Annual Report

Element Fleet Management has nominated Paolo Ferrari and Tracey McVicar for election to its Board of Directors, replacing outgoing members Andrew Clarke and Arielle Meloul-Wechsler. The company also released its inaugural annual report, highlighting strategic investments and trends in the fleet and mobility industry, which are expected to bolster its leadership position and set a foundation for future success.