Element Fleet Management (TSE:EFN)
TSX:EFN
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Element Fleet Management
(TSX:EFN)
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Rating:55Neutral
Price Target:
C$29.00
▼(-11.40% Downside)
Action:Reiterated
Date:05/11/26
The score is held back primarily by high leverage and historically inconsistent cash flow conversion, along with weak current technicals (below major moving averages and negative MACD). These are partially offset by a strong Q1 earnings call with reaffirmed 2026 guidance, record profitability/ROE, improving margins, and growing free cash flow per share, while valuation remains only moderately supportive given the ~25.8 P/E and ~1.93% yield.
Positive Factors
Top‑line Growth
Sustained revenue expansion reflects growing client adoption across leasing and fee services, improving scale economics. A larger recurring revenue base supports investment in digital initiatives, funds syndication activity and provides a steadier platform for margin expansion and capital returns over the medium term.
Negative Factors
High Leverage
Elevated and rising leverage reduces financial flexibility and amplifies sensitivity to interest rates and funding conditions. In a tougher credit cycle higher funding costs or impaired asset values could constrain originations, curtail capital returns and force more conservative growth until deleveraging occurs.
Read all positive and negative factors
Positive Factors
Negative Factors
Top‑line Growth
Sustained revenue expansion reflects growing client adoption across leasing and fee services, improving scale economics. A larger recurring revenue base supports investment in digital initiatives, funds syndication activity and provides a steadier platform for margin expansion and capital returns over the medium term.
Read all positive factors
Element Fleet Management (EFN) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$11.27B
Dividend Yield1.42%
Average Volume (3M)715.16K
Price to Earnings (P/E)25.8
Beta (1Y)0.60
Revenue Growth3.53%
EPS Growth-25.44%
CountryCA
Employees2,900
SectorIndustrials
Sector Strength72
IndustryRental & Leasing Services
Share Statistics
EPS (TTM)0.73
Shares Outstanding397,899,020
10 Day Avg. Volume625,499
30 Day Avg. Volume715,163
Financial Highlights & Ratios
PEG Ratio-1.96
Price to Book (P/B)5.33
Price to Sales (P/S)6.41
P/FCF Ratio-65.10
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$38.80Price Target Upside18.55% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
EPS Forecast (FY)1.42
Revenue Forecast (FY)C$1.31B
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 manag...
How the Company Makes Money
Element primarily makes money through (1) lease and financing-related income and (2) fee-based fleet management services. Lease/financing income is generated when Element funds or arranges the funding of client vehicles and earns revenue over the ...
Element Fleet Management Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call reports multiple record financial and operational achievements — including record net revenue, improved margins, highest ever ROE, strong free cash flow growth and solid client retention — supported by clear progress on digital and mobility initiatives (Car IQ, Nova, Element ONE). Offsetting items include a modest decline in originations driven by a normalizing originate‑to‑syndicate client and timing shifts, a single‑client credit provision, elevated expenses (notably compensation) related to strategic investments, and some seasonality/lag in services monetization. Management framed the negatives as manageable, emphasized disciplined funding and execution, and reiterated confidence in strategy and guidance.Positive Updates
Record Net Revenue
Net revenue of $324 million in Q1 2026, up 17% year‑over‑year, representing a record quarter for the company.
Negative Updates
Originations Decline and Timing Risk
Originations were $1.5 billion in Q1, down 4% year‑over‑year, primarily due to the expected reduction from an originate‑to‑syndicate client and timing shifts (clients delaying orders), which could affect Q2 originations.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Net Revenue
Net revenue of $324 million in Q1 2026, up 17% year‑over‑year, representing a record quarter for the company.
Read all positive updates
Company Guidance
Management left 2026 guidance intact after a strong Q1: net revenue $324M (+17% YoY), adjusted operating income $182M, adjusted EPS $0.35, adjusted free cash flow per share $0.45 (+25% YoY) and a record ROE of 20.3%; they reiterated expected 2026 originations of $6.5–$6.9B while noting Q1 originations were $1.5B (‑4% YoY) with ~40% of orders still to be activated (following a $2.0B order book in Q4), and said timing shifts may push some originations into Q2 but should not materially change revenue or adjusted operating income guidance. Other key metrics cited: services revenue $162M (+6% YoY) with Vehicles Under Management +3%, net financing revenue $138M and a core NFR yield of 4.98% (+40 bps), syndication volume $867M producing $24M (syndication yield 2.8%, +70 bps), operating expenses $142M (+13%) but positive operating leverage of 3.9% and operating margin of 56.2% (vs. 54.7% a year ago), a Q1 PCL of $4.6M bringing the allowance to $15.3M (~20 bps of financing receivables), ~$94M returned to shareholders in the quarter (including $57M to repurchase 2.3M shares), debt‑to‑capital 76.4% (target 73–77%), and management said expense growth should moderate while maintaining a long‑term revenue growth target of 6–8%.Element Fleet Management Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
52
Neutral
Cash Flow
36
Negative
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.36B | 2.26B | 2.20B | 1.91B | 1.46B | 1.15B |
| Gross Profit | 1.03B | 745.95M | 2.16B | 1.87B | 1.42B | 1.15B |
| EBITDA | 1.56B | 1.81B | 1.11B | 925.71M | 648.40M | 0.00 |
| Net Income | 292.52M | 284.02M | 386.77M | 344.77M | 305.30M | 279.19M |
Balance Sheet | ||||||
| Total Assets | 13.57B | 13.86B | 12.70B | 9.36B | 7.87B | 7.98B |
| Cash, Cash Equivalents and Short-Term Investments | 662.83M | 503.14M | 128.84M | 72.60M | 37.82M | 27.84M |
| Total Debt | 9.66B | 9.88B | 8.56B | 8.21B | 6.80B | 6.43B |
| Total Liabilities | 10.87B | 11.14B | 9.92B | 12.57B | 10.65B | 9.52B |
| Stockholders Equity | 2.70B | 2.72B | 2.77B | 2.94B | 2.74B | 2.71B |
Cash Flow | ||||||
| Free Cash Flow | 116.25M | -222.35M | -264.85M | -1.39B | 118.45M | 1.90B |
| Operating Cash Flow | 388.35M | -149.95M | -154.11M | -1.29B | 169.19M | 1.97B |
| Investing Cash Flow | -357.81M | -139.24M | -227.00M | -99.28M | -48.34M | -67.41M |
| Financing Cash Flow | -110.94M | 510.99M | 654.08M | 1.40B | -5.60M | -1.87B |
Element Fleet Management Technical Analysis
Negative
32.73
Price Trends
30.59
Negative
32.35
Negative
34.35
Negative
Market Momentum
-1.09
Positive
37.77
Neutral
69.56
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EFN, the sentiment is Negative. The current price of 32.73 is above the 20-day moving average (MA) of 29.52, above the 50-day MA of 30.59, and below the 200-day MA of 34.35, indicating a bearish trend. The MACD of -1.09 indicates Positive momentum. The RSI at 37.77 is Neutral, neither overbought nor oversold. The STOCH value of 69.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:EFN.
Element Fleet Management Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
68 Neutral | C$12.59B | 23.26 | 24.05% | 1.58% | -6.98% | 11.17% | |
64 Neutral | C$2.07B | 19.45 | 8.72% | 5.21% | 7.92% | -14.19% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
60 Neutral | C$16.50B | 73.02 | 11.18% | 1.75% | -7.84% | -21.07% | |
56 Neutral | C$5.70B | 27.75 | 34.23% | ― | 3.31% | -44.10% | |
55 Neutral | C$11.27B | 25.75 | 10.62% | 1.42% | 3.53% | -25.44% | |
52 Neutral | C$1.28B | 72.99 | 4.92% | 1.67% | -2.16% | -69.46% |
* Industrials Sector Average
TSE:EFN
Element Fleet Management
27.94
-4.33
-13.41%
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Element Fleet Management Corporate Events
Business Operations and StrategyExecutive/Board ChangesShareholder Meetings
Element Fleet Management Taps Former Equinix CFO Keith Taylor for Board Role
Positive
Apr 1, 2026
Element Fleet Management has nominated veteran finance executive Keith Taylor for election to its board of directors at the May 7, 2026 annual general meeting, succeeding outgoing director Joan Lamm-Tennant at the end of her term limit. The move b...
Business Operations and Strategy
Element Barometer Shows Fleets Shift From EV Ambition to Cost-Driven Execution
Positive
Mar 19, 2026
Element Fleet Management and its global partners Arval and SMAS have released the 2026 Global Fleet and Mobility Barometer, based on responses from more than 10,000 fleet decision makers in 33 countries. The report shows that corporate fleets are ...
Business Operations and StrategyStock BuybackDividendsFinancial DisclosuresM&A Transactions
Element Fleet Management Posts Record 2025 Results, Boosts Dividend and Sets Ambitious 2026 Targets
Positive
Feb 25, 2026
Element Fleet Management reported record 2025 net revenue of $1.2 billion, up 9% year over year, with adjusted diluted EPS rising 13% and operating margin expanding to 56.2%, supported by disciplined expense growth. Strong client demand drove reco...
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.