MDA Ltd (MDA) AI Stock Analysis

• Market Cap: C$4.46B
• Dividend Yield: N/A
• Average Volume (3M): 451.60K
• Price to Earnings (P/E): 44.6
• Beta (1Y): 1.23
• Revenue Growth: 49.98%
• EPS Growth: 108.76%
• Country: CA
• Employees: 3,400
• Sector: Industrials
• Sector Strength: 86
• Industry: Aerospace & Defense
• EPS (TTM): 0.29
• Shares Outstanding: 123,084,840
• 10 Day Avg. Volume: 680,917
• 30 Day Avg. Volume: 451,596
• PEG Ratio: 2.15
• Price to Book (P/B): 2.55
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.91
• 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$39.25
• Price Target Upside: 8.34% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 70 Outperform
• Price Target: C$40.00 ▲(10.41%Upside)

MDA Ltd's overall stock score is driven by strong financial performance and promising earnings call outcomes. However, the high P/E ratio and overbought technical indicators indicate potential valuation concerns and market volatility. Recent corporate events provide strategic growth opportunities, but external risks such as NASA budget uncertainty and tariffs could impact future performance.

Positive Factors

Contract Awards

The strength in Satellite Systems is benefiting from the ramp of Telesat Lightspeed and the recent Globalstar contract award.

Financial Performance

FY2025 guidance for revenue and EBITDA is well above consensus, indicating strong expected growth.

Negative Factors

Tariffs

The potential impact of U.S. tariffs on Canadian imports remains uncertain, but is considered manageable due to MDA's non-U.S. backlog and other mitigating factors.

MDA Ltd Business Overview & Revenue Model

Company Description

MDA Ltd (MDA) is a leading provider of advanced technology and services in the fields of aerospace and defense, earth observation, and satellite communications. The company specializes in delivering innovative solutions and products that cater to both commercial and government sectors, leveraging cutting-edge technologies to address complex challenges in space and satellite systems.

How the Company Makes Money

MDA Ltd generates revenue through a diverse range of streams, including the sale of specialized satellite and space systems, earth observation services, and engineering solutions for aerospace and defense applications. The company earns money by securing contracts with government agencies for defense and space exploration projects, as well as with commercial clients seeking satellite communication and data services. Key partnerships with industry leaders and government bodies also play a significant role in MDA's revenue generation, as they collaborate on large-scale projects and technology development initiatives to expand their market presence and enhance service offerings.

MDA Ltd Financial Statement Overview

Summary

MDA Ltd has shown impressive financial growth and improvement across its income statement, balance sheet, and cash flow. Revenue growth has been strong, with significant profit margin improvements indicating better operational efficiency. The balance sheet shows reduced leverage with a strong equity ratio, though debt levels should be monitored. Cash flow is robust, with free cash flow turning positive and strong cash generation relative to profits, reflecting solid financial management.

Income Statement

MDA Ltd has demonstrated strong revenue growth with a steady increase from $295.6M in 2020 to $1.08B in 2024, showing a CAGR of over 38%. Gross profit margins have improved to 26.1% in 2024 from 11.4% in 2020, indicating enhanced operational efficiency. Net profit margin rose to 7.4% in 2024 from a negative margin in 2020, showcasing improved profitability. EBIT and EBITDA margins have also improved significantly, reflecting robust core operational performance.

Balance Sheet

The company's debt-to-equity ratio has decreased from 1.27 in 2020 to 0.12 in 2024, indicating a significant improvement in capital structure and leverage reduction. Return on equity (ROE) improved to 6.8% in 2024 from negative returns in earlier years, reflecting better profitability relative to shareholder equity. Equity ratio remained strong at 45.3% in 2024, highlighting a stable financial foundation. However, the total debt is still substantial, requiring ongoing attention.

Cash Flow

MDA Ltd's free cash flow turned positive with a substantial increase from negative $179.7M in 2023 to $614.8M in 2024, reflecting improved cash management and operational efficiency. Operating cash flow to net income ratio is exceptionally high at 10.27 in 2024, suggesting strong cash generation relative to reported profits. Free cash flow to net income ratio is also positive, indicating a robust cash flow position.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.08B	807.60M	641.20M	476.90M	295.60M
Gross Profit	281.70M	244.00M	228.40M	167.80M	33.80M
EBITDA	230.00M	154.00M	150.80M	124.00M	43.60M
Net Income	79.40M	48.80M	26.30M	2.90M	-17.30M
Balance Sheet
Total Assets	2.60B	2.16B	1.75B	1.53B	1.46B
Cash, Cash Equivalents and Short-Term Investments	166.70M	22.50M	39.30M	83.60M	78.60M
Total Debt	136.80M	525.00M	251.90M	160.40M	580.20M
Total Liabilities	1.42B	1.10B	750.20M	572.90M	997.80M
Stockholders Equity	1.18B	1.06B	1.00B	961.70M	457.40M
Cash Flow
Free Cash Flow	614.80M	-179.70M	-123.10M	-22.50M	43.10M
Operating Cash Flow	815.60M	13.50M	57.00M	72.10M	56.40M
Investing Cash Flow	-229.90M	-217.60M	-180.10M	-98.80M	-1.01B
Financing Cash Flow	-436.10M	187.40M	78.80M	30.60M	1.03B

MDA Ltd Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 36.23
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:MDA, the sentiment is Positive. The current price of 36.23 is above the 20-day moving average (MA) of 31.23, above the 50-day MA of 28.26, and above the 200-day MA of 25.68, indicating a bullish trend. The MACD of 1.97 indicates Negative momentum. The RSI at 85.08 is Negative, neither overbought nor oversold. The STOCH value of 84.03 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:MDA.

MDA Ltd Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FTG	80 Outperform	C$291.11M	21.53	17.82%	―	15.25%	48.96%
CAE	78 Outperform	$12.75B	31.33	8.87%	―	7.89%	―
MAL	73 Outperform	C$1.09B	27.29	5.12%	1.05%	8.59%	242.80%
MDA	70 Outperform	C$4.46B	44.57	8.54%	―	49.98%	108.76%
BBD.B	69 Neutral	$14.41B	37.38	-18.58%	―	16.31%	4.12%
BBD.A	67 Neutral	C$11.87B	37.38	-23.10%	―	16.31%	4.12%
Sector *	65 Neutral	$10.69B	15.75	5.51%	1.90%	2.72%	-26.43%

MDA Ltd Corporate Events

MDA Space Completes Acquisition of SatixFy Communications

MDA Space Ltd. has completed its acquisition of SatixFy Communications Ltd., a company specializing in next-generation satellite communication solutions. This acquisition enhances MDA Space’s satellite systems strategy and strengthens its competitive edge as the demand for digital satellite solutions grows. The integration of SatixFy’s operations and technology into MDA’s Satellite Systems business is expected to bolster the company’s offerings in the rapidly expanding global space market.

The most recent analyst rating on (TSE:MDA) stock is a Buy with a C$18.00 price target. To see the full list of analyst forecasts on MDA Ltd stock, see the TSE:MDA Stock Forecast page.

MDA Space Extends Maritime Surveillance Contract with Canadian Government

MDA Space Ltd. has announced an extension of its contract with Fisheries and Oceans Canada to provide satellite surveillance data and analytics for maritime security. This extension supports Canada’s leadership in maritime safety and aligns with international commitments to combat illegal fishing. The contract includes future use of MDA’s upcoming Earth observation constellation, CHORUS, enhancing Canada’s capabilities in monitoring and intercepting illegal maritime activities, thereby strengthening its Indo-Pacific Strategy.

The most recent analyst rating on (TSE:MDA) stock is a Buy with a C$18.00 price target. To see the full list of analyst forecasts on MDA Ltd stock, see the TSE:MDA Stock Forecast page.

MDA Space Secures $60 Million Contract for River-class Destroyer Program

MDA Space Ltd has secured a $60 million contract for the next phase of the River-class Destroyer program, focusing on the delivery and integration of sensor systems for the first three ships. These systems are designed to enhance situational awareness and protect against laser and optical guided threats, supporting the Royal Canadian Navy’s missions. The project is part of Canada’s National Shipbuilding Strategy, with Irving Shipbuilding Inc. constructing the ships and Lockheed Martin Canada leading the combat management system design.

The most recent analyst rating on (TSE:MDA) stock is a Buy with a C$18.00 price target. To see the full list of analyst forecasts on MDA Ltd stock, see the TSE:MDA Stock Forecast page.

MDA Space and SatixFy Amend Merger Agreement with Increased Offer

MDA Space Ltd. and SatixFy Communications Ltd. have amended their merger agreement, increasing the all-cash transaction offer to US$3.00 per ordinary share, valuing SatixFy at approximately US$280 million. This decision followed a competitive ‘go-shop’ process where SatixFy received a higher offer from a third party, leading to negotiations with MDA. The increased offer was deemed the best value for shareholders, with 57% of SatixFy shareholders already committed to supporting the revised merger agreement. The shareholder meeting to approve the merger has been postponed to allow for proper disclosure.

The most recent analyst rating on (TSE:MDA) stock is a Buy with a C$17.00 price target. To see the full list of analyst forecasts on MDA Ltd stock, see the TSE:MDA Stock Forecast page.

MDA Space Announces 2025 AGM Results and Strategic Decisions

MDA Space announced the results of its 2025 Annual General Meeting, where 69.22% of common shares were represented. The meeting saw the election of nine directors, the appointment of KPMG LLP as the independent auditor, and approval of the company’s executive compensation approach. These decisions reflect MDA Space’s commitment to maintaining robust governance and operational transparency, potentially strengthening its position in the space industry.

MDA Space Ltd. Reports Strong Q1 2025 Results and Strategic Acquisition

MDA Space Ltd. reported strong financial results for the first quarter of 2025, with a significant increase in revenue and backlog, driven by new contracts such as the Globalstar LEO constellation. The company achieved a 68% year-over-year revenue growth, reaching $351 million, and a 103% increase in adjusted net income. MDA Space’s strategic acquisition of SatixFy Communications is expected to enhance its satellite systems offerings, positioning the company well to capitalize on growing demand in the space industry. The reaffirmation of its 2025 financial outlook underscores its confidence in continued growth and market expansion.

MDA Space Ltd. Reports Strong Q1 2025 Results and Strategic Expansion

MDA Space Ltd. reported a robust first quarter for 2025, with significant financial growth highlighted by a 46% increase in backlog and a 68% rise in revenues compared to the previous year. The company achieved an adjusted EBITDA of $68.6 million, marking a 63% year-over-year increase, and maintained a strong net cash position. Notably, MDA secured a major contract with Globalstar for its next-generation LEO constellation and announced the acquisition of SatixFy Communications, enhancing its satellite systems offerings. The company reaffirmed its positive financial outlook for 2025, anticipating continued growth driven by strategic initiatives and strong market demand.

MDA Space to Announce Q1 2025 Financial Results and Host Annual Shareholder Meeting

MDA Space has announced it will release its first quarter 2025 financial results on May 8, 2025, followed by a conference call and webcast to discuss the results. Additionally, the company will conduct its Annual Meeting of Shareholders virtually on the same day, allowing shareholders to participate online. These events underscore MDA Space’s commitment to transparency and engagement with its stakeholders, potentially impacting its market position and investor relations.