Enerflex (EFX) AI Stock Analysis

• Market Cap: C$1.32B
• Dividend Yield: 1.4%
• Average Volume (3M): 362.56K
• Price to Earnings (P/E): 12.9
• Beta (1Y): 1.24
• Revenue Growth: 1.22%
• EPS Growth: N/A
• Country: CA
• Employees: 4,600
• Sector: Energy
• Sector Strength: 51
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 0.26
• Shares Outstanding: 123,523,530
• 10 Day Avg. Volume: 321,522
• 30 Day Avg. Volume: 362,561
• PEG Ratio: 0.52
• Price to Book (P/B): 1.19
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 3.92
• 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$14.04
• Price Target Upside: 30.97% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 71 Outperform
• Price Target: C$11.50 ▲(7.28%Upside)

Enerflex shows strength in cash flow management and operational efficiency, with a stable balance sheet. The technical indicators are favorable, and valuation metrics suggest the stock is attractively priced. Earnings call insights highlight operational strengths but also reveal revenue challenges and leadership transitions. Recent corporate actions, such as a share buyback, bolster shareholder value.

Positive Factors

Capital Allocation

With leverage now at the lower end of its target range, the company holds flexibility around capital allocation.

Financial Performance

Enerflex's results exceeded expectations driven by stable EI/AMS work and a strong jump in ES margins.

Negative Factors

Market Uncertainty

The price target is decreased to $16 from $20, mostly reflecting some additional macro uncertainty.

Enerflex Business Overview & Revenue Model

Company Description

Enerflex Ltd. supplies natural gas compression, oil and gas processing, refrigeration systems, energy transition solutions, and electric power generation equipment to the oil and natural gas industry. The company provides custom and standard compression packages for reciprocating and screw compressor applications; and designs, engineers, manufactures, constructs, and installs modular natural gas processing equipment, refrigeration systems, and electric power solutions, as well as engages in re-engineering, re-configuration, and re-packaging of compressors for various field applications; and modular processing equipment and waste gas systems for natural gas facilities. It also offers after-market services, parts distribution, operations and maintenance solutions, equipment optimization and maintenance programs, manufacturer warranties, exchange components, long-term service agreements, and technical services. In addition, the company rents natural gas compressors totaling approximately 800,000 horsepower. It serves small to large independent producers, integrated oil and natural gas companies, midstream and petrochemical companies, power generation companies, users of natural gas-fired electric power, and carbon capture players in Canada, the United States, Argentina, Bolivia, Brazil, Colombia, Mexico, the United Kingdom, Bahrain Kuwait, Oman, the United Arab Emirates, Australia, New Zealand, Indonesia, Malaysia, and Thailand. Enerflex Ltd. was founded in 1980 and is headquartered in Calgary, Canada.

How the Company Makes Money

Enerflex generates revenue primarily through the sale and rental of its engineered systems, which include natural gas compression and processing equipment. The company also earns income from its after-market services, which involve maintenance, repair, and overhaul services for energy infrastructure. Additionally, Enerflex's revenue streams are bolstered by long-term service contracts and rental agreements, which provide stable, recurring income. The company often collaborates with oil and gas producers, leveraging its expertise to deliver customized solutions that enhance operational efficiency. Significant partnerships and contracts with major energy companies further contribute to its financial performance, allowing Enerflex to maintain a strong presence in key international markets.

Enerflex Financial Statement Overview

Summary

Enerflex is navigating a challenging revenue environment with improved operational efficiency and robust cash flow management. The balance sheet remains healthy, albeit with moderate leverage. While profitability metrics show room for improvement, the company's ability to generate cash flows provides a positive outlook.

Income Statement

Enerflex has shown a resilient performance in the TTM with a positive gross profit margin of 19.3% and a net profit margin of 1.0%, indicating a slight profitability. However, there is a decline in total revenue from the previous year, which reflects a negative growth trajectory. EBIT and EBITDA margins have improved, showing efficient operations despite revenue pressures.

Balance Sheet

The company maintains a stable financial position with an equity ratio of 37.6%, indicating a balanced approach to financing its assets. However, the debt-to-equity ratio of 0.74 suggests moderate leverage. Enerflex's return on equity is relatively low at 2.6%, indicating underutilization of shareholder funds for generating profits.

Cash Flow

Enerflex exhibits strong cash flow management with a significant increase in free cash flow, leading to a robust free cash flow to net income ratio. The operating cash flow to net income ratio is healthy, supporting liquidity. The company has successfully turned around its cash flow from previous deficits.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.41B	3.16B	1.78B	960.16M	1.22B
Gross Profit	504.00M	555.50M	322.72M	219.55M	298.18M
EBITDA	369.00M	269.70M	93.24M	124.81M	204.14M
Net Income	32.00M	-110.92M	-100.94M	-18.45M	69.07M
Balance Sheet
Total Assets	2.79B	3.91B	4.27B	2.19B	2.18B
Cash, Cash Equivalents and Short-Term Investments	92.00M	140.51M	253.78M	172.76M	95.68M
Total Debt	777.00M	1.32B	1.48B	388.44M	451.64M
Total Liabilities	1.74B	2.52B	2.73B	837.69M	782.88M
Stockholders Equity	1.05B	1.39B	1.54B	1.35B	1.40B
Cash Flow
Free Cash Flow	306.00M	185.00M	-96.07M	167.81M	86.50M
Operating Cash Flow	324.00M	273.31M	19.77M	225.16M	220.25M
Investing Cash Flow	-59.00M	-158.89M	43.25M	-63.53M	-137.76M
Financing Cash Flow	-263.00M	-200.49M	11.85M	-83.89M	-82.05M

Enerflex Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 10.72
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:EFX, the sentiment is Positive. The current price of 10.72 is above the 20-day moving average (MA) of 10.58, above the 50-day MA of 9.92, and below the 200-day MA of 11.01, indicating a neutral trend. The MACD of 0.22 indicates Positive momentum. The RSI at 57.26 is Neutral, neither overbought nor oversold. The STOCH value of 49.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:EFX.

Enerflex Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EFX	71 Outperform	C$1.32B	12.89	7.03%	1.40%	1.22%	―
Sector *	52 Neutral	C$2.91B	-0.88	-3.26%	6.30%	2.20%	-43.43%
NOA		$474.18M	15.44	9.52%	2.13%	―	―
CESDF		$1.07B	8.53	23.66%	2.46%	―	―
TOT	80 Outperform	C$411.81M	6.60	11.38%	3.64%	11.02%	102.23%
CFW	64 Neutral	C$292.02M	16.06	3.00%	―	-5.50%	-88.55%
TOLWF		$587.37M	8.76	19.44%	4.39%	―	―

Enerflex Corporate Events

Enerflex Ltd. Reports Strong Q1 2025 Financial Results with Improved Margins and Reduced Debt

Enerflex Ltd. reported its first quarter 2025 financial results, highlighting an adjusted EBITDA of $113 million and a free cash flow of $85 million. The company experienced a reduction in revenue compared to the previous year due to changes in contract accounting, but saw improvements in gross margin and return on capital employed. Enerflex’s contract backlog remains strong, providing operational visibility, and the company continues to benefit from its U.S. contract compression business driven by increased natural gas production. The company also reduced its net debt significantly, improving its financial stability.

Enerflex Ltd. Announces Successful Election of Directors and Approval of Executive Compensation

Enerflex Ltd. announced the successful election of all eight nominee directors at its virtual Annual Meeting of Shareholders, with significant approval rates. Additionally, the company’s non-binding advisory vote on executive compensation was overwhelmingly approved, reflecting strong shareholder support for the company’s leadership and strategic direction.

Enerflex Seeks New Director and Prepares for Q1 Results Release

Enerflex Ltd. has announced its intention to search for a new independent director as part of its commitment to good corporate governance. The company also aims to achieve at least 30% gender diversity on its Board by the 2026 annual meeting. Additionally, Enerflex plans to release its first-quarter financial results for 2025 on May 8, 2025, which will be followed by a conference call for stakeholders to discuss the results, indicating an ongoing effort to maintain transparency and engage with investors.