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Toromont Industries (TSE:TIH)
TSX:TIH
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Toromont Industries
(TSX:TIH)
Rating:74Outperform
Price Target:
C$157.00
▲(11.75%Upside)
Positive Factors
Acquisitions and Investments
Improving visibility into EPS growth resuming due to growth aspirations from recent acquisitions and significant resources for investments.
Company Momentum
CIMCO appears to be gaining momentum with revenues increasing 23% y/y due to stronger packages revenue.
Dividend Increase
The quarterly dividend was increased 8% to $0.52/sh.
Financial Performance
Strong underlying financial performance with EPS growth set to re-accelerate.
Negative Factors
Trade Relations
The potential for tariffs between the US and Canada is an overhang and could impact customer capex decisions.
Toromont Industries (TIH) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$11.40B
Dividend Yield1.42%
Average Volume (3M)130.34K
Price to Earnings (P/E)23.6
Beta (1Y)0.63
Revenue Growth6.99%
EPS Growth-5.58%
CountryCA
Employees7,300
SectorIndustrials
Sector Strength86
IndustryIndustrial - Distribution
Share Statistics
EPS (TTM)1.53
Shares Outstanding81,173,580
10 Day Avg. Volume147,375
30 Day Avg. Volume130,343
Financial Highlights & Ratios
PEG Ratio-13.43
Price to Book (P/B)3.63
Price to Sales (P/S)0.00
P/FCF Ratio111.42
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$144.38Price Target Upside2.77% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
Toromont Industries Business Overview & Revenue Model
Company DescriptionToromont Industries Ltd. provides specialized capital equipment in Canada, the United States, and internationally. It operates in two segments, Equipment Group and CIMCO. The Equipment Group segment engages in the sale, rental, and service of mobile equipment for Caterpillar and other manufacturers; sale, rental, and service of engines used in various applications, including industrial, commercial, marine, on-highway trucks, and power generation; and sale of complementary and related products, parts, and services. This segment serves building, mining, aggregates, public infrastructure, residential construction, power generation, marine, agriculture, forestry, on-highway truck engines, industrial, demolition, and waste management markets. The CIMCO segment is involved in the design, engineering, fabrication, installation, and after-sale support of refrigeration systems in industrial and recreational markets. This segment primarily serves beverage and food processing, cold storage, food distribution, mining, and recreational ice rink sectors. Toromont Industries Ltd. was founded in 1961 and is based in Concord, Canada.
How the Company Makes MoneyToromont Industries makes money through the sale and rental of heavy equipment and power systems in its Equipment Group segment. This includes revenue from new and used equipment sales, rental services, and maintenance and repair services. The company also generates substantial income from its after-market services, which include parts sales and field service work. In the CIMCO segment, Toromont earns revenue from the design, manufacture, and installation of industrial and recreational refrigeration systems, along with ongoing maintenance and support services. Strategic partnerships with leading equipment manufacturers, such as Caterpillar, provide a strong foundation for equipment sales and support, contributing significantly to Toromont's revenue.
Toromont Industries Earnings Call Summary
Earnings Call Date:Jul 29, 2025
(Q2-2025)
| % Change Since: 5.84%|
Next Earnings Date:Oct 29, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with notable achievements in revenue growth, particularly in CIMCO and AVL contributions, alongside healthy backlog and liquidity. However, these were counterbalanced by challenges in the mining segment, increased expenses, and a decline in operating income and net earnings.Q2-2025 Updates
Positive Updates
Revenue Increase Despite Challenges
Overall revenue increased, with significant contributions from rental and product support as well as new equipment deliveries in the construction and power segments. However, these were balanced by lower mining sales.
CIMCO Revenue Growth
CIMCO posted higher revenue and earnings, with package revenue supported by a strong order backlog and improved product support activity.
AVL Acquisition Progress
AVL contributed $57 million in revenue for Q2 and $79 million year-to-date, with production ramping up and a healthy order backlog of $246 million.
Healthy Backlog and Liquidity
Backlog remains healthy at $1.4 billion, with ample liquidity including $1 billion in cash and $456 million available under existing credit facilities.
RPO Fleet and Rental Revenue Growth
Rental revenue was up 15% in Q2 and 13% year-to-date, supported by a larger fleet and improved utilization. RPO fleet increased to $101.4 million, up from $64.1 million a year ago.
Negative Updates
Decline in Mining Segment
Lower deliveries in the mining segment contributed to a decrease in revenues, as mining sales were down 54% compared to the previous year.
Operating Income Decrease
Operating income declined by 4% year-over-year, mainly due to AVL-related noncash expenses and lower interest income.
Increased Expenses
Total expenses increased by 11% during the quarter, attributed to AVL acquisition-related amortization and higher compensation costs.
Net Earnings Decrease
Net earnings decreased by 8% or $11 million in the quarter compared to last year, with basic earnings per share reflecting this decline.
Lower Return on Equity
Return on equity was 17.6%, slightly below the target of 18%, reflecting increased capital investment and comparatively lower earnings.
Company Guidance
In the second quarter of 2025, Toromont Industries Limited reported mixed financial results amidst ongoing macroeconomic and trade uncertainties. Revenue increased modestly by 1% compared to the same quarter last year, with CIMCO driving a 13% rise due to strong market demand and execution in both Canada and the U.S. The Equipment Group saw stable revenue, with growth in rental (up 15%) and product support (up 4%), but was offset by a 54% decline in mining equipment deliveries. Operating income decreased by 4% year-over-year, influenced by AVL acquisition-related noncash expenses. Net earnings fell by 8%, while basic earnings per share stood at $1.53 for the quarter. The company maintained a robust backlog of $1.4 billion, with CIMCO's backlog increasing by 21%. Toromont ended the quarter with significant liquidity, including $1 billion in cash, and a net debt to total capitalization ratio of negative 3%. The dividend was maintained at $0.52 per share, reflecting Toromont's cautious yet optimistic outlook amid evolving economic conditions.Toromont Industries Financial Statement Overview
Summary
Toromont Industries demonstrates strong financial health with consistent revenue growth and effective cost management. The balance sheet shows low leverage and a solid equity base, though rising debt levels need attention. Cash flow management is good despite recent declines in free cash flow. Overall, the company is well-positioned for stability and growth, but profitability and debt need careful monitoring.Income Statement
Toromont Industries has shown consistent revenue growth over the years, with a 20.5% increase from 2020 to 2024. The gross profit margin remains strong at 24.5% for TTM (Trailing-Twelve-Months). EBIT and EBITDA margins are robust at 13.0% and 18.0%, respectively, indicating effective cost management and operational efficiency. However, a slight decrease in net income from the previous year suggests potential challenges in maintaining profitability.85
Very Positive
Balance Sheet
The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.33, reflecting low leverage. Return on equity is satisfactory at 16.7% for TTM, displaying effective utilization of equity. The equity ratio is strong at 57.4%, indicating a stable financial structure. However, a notable increase in total debt could pose future financial risks if not managed properly.78
Positive
Cash Flow
Toromont Industries demonstrates strong cash flow management, with operating cash flow exceeding net income, indicating solid cash generation capabilities. Free cash flow saw a significant decline by 56.6% from the previous year, which could impact future investments and dividend policies. The free cash flow to net income ratio remains healthy, suggesting sustainable operations.81
Very Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 5.02B | 4.62B | 4.23B | 3.89B | 3.48B |
| Gross Profit | 1.26B | 1.24B | 1.13B | 969.77M | 835.75M |
| EBITDA | 928.78M | 932.65M | 802.97M | 643.32M | 547.82M |
| Net Income | 506.52M | 534.71M | 454.20M | 332.71M | 254.91M |
Balance Sheet | |||||
| Total Assets | 4.87B | 4.57B | 4.18B | 3.58B | 3.35B |
| Cash, Cash Equivalents and Short-Term Investments | 890.82M | 1.04B | 927.78M | 916.83M | 591.13M |
| Total Debt | 689.72M | 682.06M | 670.92M | 665.92M | 672.06M |
| Total Liabilities | 1.91B | 1.89B | 1.86B | 1.63B | 1.65B |
| Stockholders Equity | 2.96B | 2.68B | 2.33B | 1.95B | 1.70B |
Cash Flow | |||||
| Free Cash Flow | 222.71M | 241.32M | 147.62M | 471.52M | 305.74M |
| Operating Cash Flow | 359.23M | 355.79M | 216.95M | 542.72M | 349.03M |
| Investing Cash Flow | -206.80M | -78.12M | -44.33M | -68.87M | -32.55M |
| Financing Cash Flow | -303.54M | -164.49M | -162.16M | -148.14M | -90.88M |
Toromont Industries Technical Analysis
Positive
140.49
Price Trends
124.11
Positive
118.85
Positive
117.95
Positive
Market Momentum
3.82
Negative
82.35
Negative
91.16
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TIH, the sentiment is Positive. The current price of 140.49 is above the 20-day moving average (MA) of 130.22, above the 50-day MA of 124.11, and above the 200-day MA of 117.95, indicating a bullish trend. The MACD of 3.82 indicates Negative momentum. The RSI at 82.35 is Negative, neither overbought nor oversold. The STOCH value of 91.16 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:TIH.
Toromont Industries Peers Comparison
Overall Rating
UnderperformOutperform
Sector (66)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | C$8.01B | 16.92 | 18.79% | 1.87% | 6.61% | 1.87% | |
75 Outperform | C$16.42B | 25.94 | -23.10% | ― | 6.69% | 64.89% | |
74 Outperform | C$11.40B | 23.58 | 16.70% | 1.42% | 6.99% | -5.58% | |
73 Outperform | C$515.17M | 12.57 | 8.09% | 5.88% | -2.65% | -47.65% | |
66 Neutral | £2.71B | 11.98 | 4.22% | 3.39% | 2.19% | -20.98% | |
48 Neutral | C$1.22B | 48.06 | 2.78% | 3.93% | 20.53% | 74.96% | |
| ― | $1.77B | 16.53 | 9.30% | 3.79% | ― | ― |
* Industrials Sector Average
Performance Comparison
TSE:TIH
Toromont Industries
140.49
17.03
13.79%
TSE:ARE
Aecon Group Inc.
19.34
2.88
17.50%
TSE:BBD.A
Bombardier Cl A MV
163.62
79.40
94.28%
TSE:FTT
Finning International
60.29
24.27
67.38%
TSE:WJX
Wajax Corporation
23.81
<0.01
0.04%
RUSMF
Russel Metals
31.53
5.82
22.64%
Toromont Industries Corporate Events
Business Operations and StrategyFinancial Disclosures
Toromont Industries Reports Q2 2025 Results with Revenue Growth Amid Earnings Decline
Neutral
Jul 29, 2025
Toromont Industries Ltd. reported a slight increase in revenue for the second quarter of 2025, driven by strong performance in the Equipment Group and CIMCO divisions. Despite a 1% revenue increase, net earnings fell by 8% due to higher expenses and reduced interest income. The company continues to face challenges in the mining segment but sees growth in construction and power. The acquisition of AVL Manufacturing has contributed to the order backlog, and the company is investing in workforce expansion to support future growth.
The most recent analyst rating on (TSE:TIH) stock is a Hold with a C$122.00 price target. To see the full list of analyst forecasts on Toromont Industries stock, see the TSE:TIH Stock Forecast page.
Financial Disclosures
Toromont Industries to Release Q2 2025 Financial Results
Neutral
Jul 16, 2025
Toromont Industries Ltd. is set to announce its second quarter 2025 financial results on July 29, 2025. A teleconference and audio webcast will be held on July 30, 2025, to discuss these results and operating highlights, featuring addresses by key executives. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and operational strategies, potentially impacting its industry positioning and investor relations.
The most recent analyst rating on (TSE:TIH) stock is a Hold with a C$122.00 price target. To see the full list of analyst forecasts on Toromont Industries stock, see the TSE:TIH Stock Forecast page.
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.