Toromont Industries (TIH) AI Stock Analysis

• Market Cap: C$16.43B
• Dividend Yield: 1.25%
• Average Volume (3M): 166.28K
• Price to Earnings (P/E): 27.2
• Beta (1Y): 0.69
• Revenue Growth: 2.97%
• EPS Growth: -0.80%
• Country: CA
• Employees: 7,300
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 1.93
• Shares Outstanding: 81,452,100
• 10 Day Avg. Volume: 127,018
• 30 Day Avg. Volume: 166,275
• PEG Ratio: -23.99
• Price to Book (P/B): 4.10
• Price to Sales (P/S): 2.59
• P/FCF Ratio: 26.26
• 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$208.83
• Price Target Upside: 3.55% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): 7.08
• Revenue Forecast (FY): C$5.60B

• Rating: 73 Outperform
• Price Target: C$228.00 ▲(13.05% Upside)
• Action: Upgraded Date: 02/18/26
• Date: Action: Upgraded 02/18/26

The score is led by strong fundamentals (growth, solid margins, conservative leverage) and a constructive earnings update (backlog/bookings strength, liquidity, and capital returns). This is tempered by premium valuation and overbought technical signals, plus cash-flow variability and some recent cost/margin pressure.

Positive Factors

Large, growing backlog/order intake

A materially larger backlog and sharply higher bookings provide durable near‑term revenue visibility and support equipment production and service cadence. With ~90% of Equipment Group backlog expected to ship within 12 months, the backlog underpins organic revenue growth and capacity planning into the next 12 months.

Conservative balance sheet and strong liquidity

Substantial cash and undrawn credit plus low net leverage give the company flexibility to fund the AVL ramp, capital expenditure, and opportunistic M&A while maintaining capital returns. Equity growth and conservative debt ratios reduce refinancing risk and support strategic execution through industry cycles.

Recurring aftermarket and rental revenues

A sizable and growing installed base with expanding product support and rental streams creates recurring, higher‑margin cash flow that is less cyclical than new equipment sales. This structural mix supports margin sustainability, steadier cash generation, and customer stickiness across construction, mining and industrial end markets.

Negative Factors

Margin pressure and rising operating expenses

Operating cost growth and compression in rental and product support margins suggest pressure on core profitability. Margins peaked in 2022–2023; persistent SG&A and margin erosion would reduce operating leverage, slow ROE improvement toward targets, and constrain the free cash flow available for returns.

Volatile cash-flow generation

Wide year-to-year swings in operating cash flow and free cash flow reflect working‑capital and capex variability. That variability complicates capacity to sustainably fund dividends, buybacks or sizable acquisitions without depending on cyclical timing, making capital returns and reinvestment less predictable.

Acquisition accounting charges and higher financing costs

Significant amortization and revaluation tied to the AVL acquisition compress reported earnings near term, while new senior debt issuance raised interest expense. Combined with the noted increase in absolute debt in 2025, these factors raise reported expense volatility and financing cost risk during the AVL production ramp through 2026.

Toromont Industries Business Overview & Revenue Model

Company Description

Toromont 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 Money

Toromont Industries generates revenue through multiple key streams. The primary source of income comes from the sale of heavy equipment, particularly Caterpillar products, which are crucial for construction and mining activities. The company also earns significant revenue from its parts and service divisions, providing maintenance, repair, and spare parts for the equipment it sells. Additionally, Toromont's power systems segment, which includes the sale of generators and related services, contributes to its revenue. Strategic partnerships with manufacturers like Caterpillar enhance TIH's offerings and market reach. The company also benefits from its established customer relationships, leading to repeat business and long-term contracts, especially in sectors with ongoing equipment needs.

Toromont Industries Financial Statement Overview

Summary

Strong multi-year revenue growth and solid profitability with low leverage and rising equity. Offsets include some margin softening versus the 2022–2023 peak and notably volatile cash-flow conversion despite a 2025 free-cash-flow rebound.

Income Statement

Revenue has grown steadily from 2020 to 2025 (from ~3.48B to ~5.20B), showing durable end-market demand and execution. Profitability is solid, with 2025 gross margin ~25% and healthy operating profitability (EBIT margin ~13.8%, EBITDA margin ~19.9%). A key watch-out is that margins peaked in 2022–2023 and have eased modestly since, and 2025 net income dipped slightly versus 2024 despite higher revenue—suggesting some cost pressure or mix/headwind into the latest year.

Balance Sheet

The balance sheet looks conservatively levered: debt-to-equity remains low (~0.23–0.34 across 2021–2025, ~0.26 in 2025) while equity has compounded meaningfully (from ~1.70B in 2020 to ~3.29B in 2025). Total assets have also expanded consistently, indicating scale growth without outsized balance-sheet risk. The main weakness is that absolute debt rose in 2025 versus 2024, which bears monitoring if profitability continues to soften.

Cash Flow

Cash generation is generally positive, with 2025 operating cash flow of ~742M and free cash flow of ~514M (a sharp rebound versus 2024’s ~162M). However, cash flow has been volatile year-to-year (notably the 2024 drop and prior swings), and free cash flow has not consistently tracked earnings strongly (free cash flow running at ~32% of net income in 2024, improving to ~69% in 2025). This variability suggests working-capital and/or capital spending swings that can materially affect cash available to shareholders.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.20B	5.02B	4.62B	4.12B	3.89B
Gross Profit	1.32B	1.26B	1.24B	1.12B	969.77M
EBITDA	1.03B	864.02M	876.31M	772.03M	627.66M
Net Income	496.59M	506.52M	534.71M	454.20M	332.71M
Balance Sheet
Total Assets	5.47B	4.87B	4.57B	4.18B	3.58B
Cash, Cash Equivalents and Short-Term Investments	1.33B	890.82M	1.04B	927.78M	916.83M
Total Debt	851.12M	689.72M	682.06M	670.92M	665.92M
Total Liabilities	2.18B	1.91B	1.89B	1.86B	1.63B
Stockholders Equity	3.29B	2.96B	2.68B	2.33B	1.95B
Cash Flow
Free Cash Flow	513.96M	162.19M	180.62M	114.19M	420.68M
Operating Cash Flow	742.12M	508.10M	526.99M	388.17M	610.07M
Investing Cash Flow	-258.86M	-355.78M	-249.31M	-215.55M	-136.21M
Financing Cash Flow	-47.29M	-303.44M	-164.49M	-162.16M	-148.14M

Toromont Industries Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 201.68
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 201.68 is below the 20-day moving average (MA) of 202.87, above the 50-day MA of 185.78, and above the 200-day MA of 154.46, indicating a neutral trend. The MACD of 5.27 indicates Positive momentum. The RSI at 56.30 is Neutral, neither overbought nor oversold. The STOCH value of 24.24 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:TIH.

Toromont Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TIH	73 Outperform	C$16.43B	27.18	15.97%	1.25%	2.97%	-0.80%
FTT	71 Outperform	C$11.75B	19.57	19.66%	1.58%	1.32%	24.27%
WJX	66 Neutral	C$728.43M	10.32	10.91%	5.09%	3.71%	-12.70%
RUS	65 Neutral	$2.57B	20.03	10.04%	3.88%	8.15%	-3.57%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
BDGI	61 Neutral	C$2.17B	29.89	22.05%	0.99%	13.02%	52.88%
ATS	60 Neutral	C$3.99B	30.95	-0.27%	―	-5.59%	-104.09%

Toromont Industries Corporate Events

Toromont posts higher 2025 revenue, lifts dividend as margins hold firm

Toromont Industries reported fourth-quarter 2025 revenue of $1.42 billion, up 9% year over year, and full-year revenue of $5.2 billion, a 4% increase, driven by growth in both the Equipment Group and CIMCO. Earnings were relatively flat, with quarterly net income up 1% and full-year net income down 2%, as higher gross margins and acquisition-driven growth were offset by increased expenses, lower net interest income, and non-cash costs tied to the AVL acquisition.

The company highlighted strong rental, product support, and power systems activity, while mining equipment deliveries declined against a strong prior-year comparison but finished with robust fourth-quarter bookings. CIMCO delivered higher revenue and earnings on solid package and product support demand in both Canada and the U.S., and Toromont’s board raised the quarterly dividend by 7.7%, underscoring confidence in the firm’s financial position and long-term outlook despite macroeconomic and trade uncertainty.

The most recent analyst rating on (TSE:TIH) stock is a Hold with a C$172.00 price target. To see the full list of analyst forecasts on Toromont Industries stock, see the TSE:TIH Stock Forecast page.

Toromont Sets February 10 Date to Release 2025 Full-Year Results

Toromont Industries will release its 2025 fourth-quarter and full-year financial results after markets close on February 10, 2026, and will hold an analyst and media call and webcast the following morning to review the numbers and discuss operating highlights. The scheduled briefing, led by CEO Michael S. McMillan and CFO John M. Doolittle, underscores the company’s engagement with investors and stakeholders as it provides insight into recent performance and business trends across its equipment and thermal management operations.

The most recent analyst rating on (TSE:TIH) stock is a Hold with a C$196.00 price target. To see the full list of analyst forecasts on Toromont Industries stock, see the TSE:TIH Stock Forecast page.