Finning International (FTT) AI Stock Analysis

• Market Cap: C$12.21B
• Dividend Yield: 1.58%
• Average Volume (3M): 448.79K
• Price to Earnings (P/E): 24.6
• Beta (1Y): 1.37
• Revenue Growth: 1.32%
• EPS Growth: 24.27%
• Country: CA
• Employees: 13,188
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 1.00
• Shares Outstanding: 130,822,480
• 10 Day Avg. Volume: 342,722
• 30 Day Avg. Volume: 448,793
• PEG Ratio: 3.94
• Price to Book (P/B): 3.55
• Price to Sales (P/S): 0.93
• P/FCF Ratio: 20.63
• 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$103.20
• Price Target Upside: 10.56% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 4.69
• Revenue Forecast (FY): C$10.94B

• Rating: 71 Outperform
• Price Target: C$108.00 ▲(15.71% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is driven mainly by sound fundamentals (healthy profitability and manageable, improving leverage) and a positive earnings-call backdrop (record backlog, improving returns, and strong cash generation/deleveraging). Technicals add support via a clear uptrend, while valuation is the main offset due to a higher P/E and modest dividend yield.

Positive Factors

Exclusive Caterpillar dealership

Exclusive, territory-based Caterpillar dealership rights create durable competitive advantage: guaranteed product supply, strong brand pull and scale across mining, construction and energy. This underpins recurring parts and service demand and raises barriers to entry for rivals in these regions.

Recurring product-support growth

Consistent expansion of product-support (~$6B) and technician capacity shifts revenue mix toward recurring, higher‑stickiness services. Service aftermarkets are less cyclical than equipment sales, improving revenue durability, parts attachment and lifetime customer relationships over multi-year cycles.

Strong cash generation and deleveraging

Large, positive free cash flow and a meaningful reduction in net debt/EBITDA strengthen financial flexibility. Improved cash conversion funds capex, rental fleet investment and technician hiring while lowering leverage-driven downside, supporting durable capital allocation and cyclical resilience.

Negative Factors

Used-equipment and revenue volatility

Material swings in used-equipment volumes create earnings and margin variability because resale mix and non-repeating conversions materially affect gross profit. Combined with a modest revenue slip in 2025, this history of volatility weakens predictability of cash flows across cycles.

Margin pressure and one-time charges

Erosion of product-support margins, a $22M technology write-off and elevated LTIP costs compress operating margins and introduce non-operational noise. If support margins or compensation expense remain elevated, sustained margin recovery could be delayed despite revenue and ROIC gains.

High capital intensity and execution risk

Significant planned capex and rental‑fleet spending raises reinvestment needs and execution demands on supply chain and hiring. Scaling fleets and technicians is capital intensive; mis-timing or weaker demand would pressure cash flow and leverage, increasing cyclicality of returns.

Finning International Business Overview & Revenue Model

Company Description

Finning International Inc. sells, services, and rents heavy equipment, and power and energy systems in Canada, Chile, the United Kingdom, Argentina, and internationally. The company offers telehandlers, articulated trucks, asphalt pavers, backhoe loaders, cable assist vehicles, cable yarding systems, chip dozers, cold planers, compactors, dozers, drills, electric rope shovels, excavators, material handlers, motor graders, off-highway trucks, pipelayers, remixing transfer vehicle, road reclaimers, road wideners, skid steer and compact track loaders, tack distributors, track loaders, underground-hard rock, wheel loaders, wheel tractor-scrapers, and windrow elevators, as well as attachments. It is also involved in electric power generation, marine power systems, oil and gas, and industrials. In addition, the company provides aftercare, customer training, fuel solutions, fluid analysis, financing, rebuilds, rentals, repair services, maintenance options, warranty, and other services, as well as product support including sales of parts and servicing of equipment. It serves agriculture, construction, forestry, governmental, mining, paving, pipeline, power systems, and snow removal industries. The company was formerly known as Finning Ltd. and changed its name to Finning International Inc. in April 1997. Finning International Inc. was incorporated in 1933 and is headquartered in Surrey, Canada.

How the Company Makes Money

Finning International generates revenue through multiple streams, primarily from the sale of new and used heavy equipment and machinery, which constitute a significant portion of its income. The company also earns revenue through parts sales, providing essential components for maintenance and repair of equipment. Additionally, Finning's aftermarket services, including equipment repair, maintenance contracts, and rental services, contribute to a steady revenue flow. Strategic partnerships with Caterpillar and other manufacturers further enhance its market position, allowing Finning to leverage brand reputation and access a broad range of products. The company's diversification into various sectors, such as construction, mining, and forestry, also helps mitigate risks and stabilize earnings across different market conditions.

Finning International Financial Statement Overview

Summary

Solid profitability and equity growth with moderate leverage (debt-to-equity ~1.0 and improving) support a strong base, but recent revenue softness and notable free-cash-flow volatility across years reduce confidence in consistency through the cycle.

Income Statement

Revenue scaled materially from 2020 to 2024 (from ~6.2B to ~11.2B), but 2025 revenue slipped (-1.7% growth), pointing to a softer near-term demand backdrop. Profitability has been steady and healthy for a distributor: 2024 gross margin was ~22.1% and net margin ~4.5%, with earnings holding roughly flat across 2022–2025 (~503–509M) despite the revenue fluctuation. The main watch-out is modest margin compression versus 2022–2023 levels and the lack of clear earnings growth in the most recent years.

Balance Sheet

Leverage is moderate for the business: debt-to-equity ran around ~0.95–1.07 during 2022–2024, improving to ~0.98 in 2024, with total debt also easing in 2025 (2.58B to 2.31B). Equity has been building (2.44B in 2022 to 2.79B in 2025), supporting balance-sheet resilience. Returns on equity were strong in 2022–2024 (~19–21%), but leverage remains meaningful and could amplify downside in a cyclical industrial environment.

Cash Flow

Cash generation is positive but volatile. Free cash flow rebounded sharply from near-breakeven in 2023 (8M) to strong levels in 2024 (856M) and remained solid in 2025 (480M), suggesting improved working-capital and/or capex discipline. In 2024, free cash flow was a high share of net income (~0.85x), indicating decent earnings-to-cash conversion that year. The key weakness is the history of large swings (including negative free cash flow in 2022 and very low free cash flow in 2023), which lowers confidence in consistency across cycles.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	10.59B	11.21B	10.53B	9.28B	7.29B
Gross Profit	2.37B	2.48B	2.50B	2.22B	1.80B
EBITDA	1.25B	1.09B	1.18B	975.00M	729.00M
Net Income	506.00M	509.00M	523.00M	503.00M	364.00M
Balance Sheet
Total Assets	7.80B	7.73B	7.56B	7.27B	5.97B
Cash, Cash Equivalents and Short-Term Investments	397.00M	316.00M	177.00M	288.00M	502.00M
Total Debt	2.31B	2.58B	2.70B	2.33B	1.81B
Total Liabilities	5.01B	5.09B	5.03B	4.81B	3.63B
Stockholders Equity	2.79B	2.63B	2.51B	2.44B	2.32B
Cash Flow
Free Cash Flow	480.00M	856.00M	8.00M	-170.00M	292.00M
Operating Cash Flow	688.00M	1.01B	228.00M	1.00M	425.00M
Investing Cash Flow	217.00M	-128.00M	-229.00M	-268.00M	-151.00M
Financing Cash Flow	-817.00M	-816.00M	-71.00M	-13.00M	-300.00M

Finning International Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 93.34
• 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:FTT, the sentiment is Positive. The current price of 93.34 is above the 20-day moving average (MA) of 89.98, above the 50-day MA of 84.12, and above the 200-day MA of 67.72, indicating a bullish trend. The MACD of 2.65 indicates Negative momentum. The RSI at 58.74 is Neutral, neither overbought nor oversold. The STOCH value of 72.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:FTT.

Finning International Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ATRL	73 Outperform	$15.94B	6.26	56.38%	0.09%	13.97%	715.65%
TIH	73 Outperform	C$17.13B	34.43	16.34%	1.25%	2.97%	-0.80%
FTT	71 Outperform	C$12.21B	24.56	19.66%	1.58%	1.32%	24.27%
WJX	69 Neutral	C$737.82M	15.85	8.84%	5.09%	3.71%	-12.70%
ARE	65 Neutral	C$2.44B	291.42	0.92%	2.38%	25.68%	―
RUS	65 Neutral	$2.66B	16.05	10.04%	3.88%	8.15%	-3.57%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Finning International Corporate Events

Finning lifts 2025 revenue and backlog as product support and equipment sales hit records

Finning reported 2025 revenue of $10.6 billion, up 7% year over year, with fourth-quarter sales rising 6% to $2.7 billion on broad-based regional growth and robust demand for product support and new equipment. Product support revenue climbed 8% in both the quarter and full year, nearing $6 billion annually, while new equipment sales hit a record $3.9 billion and contributed to a record $3.1 billion order backlog, particularly in Canada.

Despite higher long-term incentive plan expenses and a write-off of certain IT assets tied to aligning with Caterpillar’s digital and technology strategy, adjusted EBIT for 2025 rose 6% to $869 million and adjusted ROIC improved to 19.2%. Strong free cash flow of $642 million in the fourth quarter helped reduce net debt to 1.2 times adjusted EBITDA, and management highlighted improved earnings resilience, constructive mining and power & energy markets, and anticipated improvement in construction demand in 2026 as key supports for continued strategic execution and shareholder value creation.

The most recent analyst rating on (TSE:FTT) stock is a Buy with a C$100.00 price target. To see the full list of analyst forecasts on Finning International stock, see the TSE:FTT Stock Forecast page.