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Thermal Energy International Inc (TSE:TMG)
:TMG

Thermal Energy International (TMG) AI Stock Analysis

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Thermal Energy International

(TMG)

66Neutral
Thermal Energy International's strengths lie in robust revenue growth and strategic investments for future expansion. However, challenges such as declining profitability metrics and bearish technical indicators weigh on the stock. The current valuation appears high given the recent earnings performance, suggesting caution. Notable corporate events provide a positive outlook, but careful management is needed to ensure sustained profitability.

Thermal Energy International (TMG) vs. S&P 500 (SPY)

Thermal Energy International Business Overview & Revenue Model

Company DescriptionThermal Energy International (TMG) is a Canadian clean technology company specializing in energy efficiency and emissions reduction solutions. Primarily serving industrial, commercial, and institutional sectors, the company offers a range of proprietary products and services designed to optimize energy use, reduce carbon emissions, and save costs. Core offerings include heat recovery systems, steam traps, and condensate return systems.
How the Company Makes MoneyThermal Energy International generates revenue through the sale and implementation of its energy efficiency and emissions reduction products and services. Key revenue streams include equipment sales, engineering services, and long-term maintenance contracts. The company also engages in partnerships with industrial and commercial entities, which help drive sales and expand market reach. Additionally, TMG may benefit from government incentives and programs aimed at promoting energy efficiency and reducing carbon footprints.

Thermal Energy International Financial Statement Overview

Summary
Thermal Energy International demonstrates robust revenue growth and improving profitability metrics, underscoring effective operational strategies in the industrial goods sector. While the balance sheet is relatively stable, attention to debt levels and cash flow management is essential to sustain long-term growth and mitigate financial risks.
Income Statement
78
Positive
The company shows a strong revenue growth trajectory with a substantial increase in total revenue from previous years. Gross profit margin is healthy at about 40%, and net profit margin is improving, reflecting better operational efficiency. EBIT and EBITDA margins indicate positive earnings performance. However, the company experienced a dip in EBIT margin in the TTM period, suggesting some operational challenges.
Balance Sheet
72
Positive
The balance sheet displays moderate leverage with a debt-to-equity ratio of approximately 0.85 in the TTM period, which is manageable but worth monitoring. Return on equity has improved significantly due to rising net income, indicating efficient use of equity capital. The equity ratio is also healthy, providing a solid foundation for further growth. However, total debt levels require careful management to avoid financial strain.
Cash Flow
65
Positive
The company exhibits strong free cash flow generation, with a positive growth rate in recent periods, supporting liquidity and investment capacity. The operating cash flow to net income ratio above 1 indicates strong cash generation relative to net income. Yet, the free cash flow to net income ratio suggests potential fluctuations in cash availability, highlighting the need for prudent cash management.
Breakdown
Jun 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
25.88M21.09M15.91M15.35M21.42M
Gross Profit
12.45M9.57M6.73M6.75M8.95M
EBIT
1.37M1.14M-1.41M335.47K-1.79M
EBITDA
2.14M1.76M-772.74K894.88K-1.44M
Net Income Common Stockholders
929.50K717.96K-1.92M198.13K-1.90M
Balance SheetCash, Cash Equivalents and Short-Term Investments
6.97M2.81M2.46M4.24M4.77M
Total Assets
16.79M13.51M9.60M11.55M10.44M
Total Debt
3.89M4.73M5.31M4.81M3.30M
Net Debt
-3.07M1.92M2.84M572.63K-1.48M
Total Liabilities
13.37M11.59M8.55M8.58M8.44M
Stockholders Equity
3.46M1.97M1.08M3.04M2.10M
Cash FlowFree Cash Flow
5.02M1.33M-1.99M-1.31M1.03M
Operating Cash Flow
5.40M1.41M-1.64M-1.19M1.31M
Investing Cash Flow
-376.89K-77.70K-351.93K-125.39K-280.55K
Financing Cash Flow
-1.06M-1.04M357.56K892.79K-451.09K

Thermal Energy International Technical Analysis

Technical Analysis Sentiment
Negative
Last Price0.12
Price Trends
50DMA
0.13
Negative
100DMA
0.16
Negative
200DMA
0.19
Negative
Market Momentum
MACD
>-0.01
Negative
RSI
39.14
Neutral
STOCH
66.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TMG, the sentiment is Negative. The current price of 0.12 is above the 20-day moving average (MA) of 0.12, below the 50-day MA of 0.13, and below the 200-day MA of 0.19, indicating a bearish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 39.14 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:TMG.

Thermal Energy International Peers Comparison

Overall Rating
UnderperformOutperform
Sector (55)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSNPI
73
Outperform
$4.96B18.396.48%6.38%5.08%
TSTMG
66
Neutral
C$20.77M34.2917.34%17.76%-72.66%
TSBLN
62
Neutral
C$552.76M-14.10%31.68%67.90%
TSGRN
58
Neutral
C$14.12M-5.60%-10.37%95.22%
55
Neutral
$7.14B3.55-6.61%5.99%-0.04%-51.63%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:TMG
Thermal Energy International
0.11
-0.16
-59.26%
TSE:NPI
Northland Power
18.86
-1.05
-5.30%
TSE:GRN
Greenlane Renewables Inc
0.09
<0.01
12.50%
TSE:BLN
Blackline Safety
6.50
2.17
50.12%

Thermal Energy International Earnings Call Summary

Earnings Call Date:Jan 28, 2025
(Q3-2025)
|
% Change Since: 0.00%|
Next Earnings Date:Apr 29, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted a record year-to-date revenue and strong financial positioning with significant debt reduction and a robust business development pipeline. However, the quarter faced challenges with a decline in quarterly revenue, negative EBITDA, and a net income loss. Despite these challenges, future investments and strong pipeline indicate potential growth.
Q3-2025 Updates
Positive Updates
Record Year-to-Date Revenue
Revenue for the year-to-date period was at an all-time high, 25% ahead of last year.
Trailing 12-Month Revenue Growth
Trailing 12-month revenue was $30.5 million, up 76% over the past two years.
Strong Balance Sheet
At the end of February, cash and cash equivalents were $5.1 million, with working capital at $2.4 million.
Debt Reduction
Long-term debt reduced to $1.4 million, down by approximately $2.1 million over the last two years through internally generated cash flow.
Strong Business Development Pipeline
The business development pipeline remains strong with many repeat and new opportunities.
Largest Engineering Contract Signed
A $500,000 engineering contract was signed with a leading multinational pharmaceutical company, marking the largest engineering contract ever.
Successful Repeat Business
A $1 million heat recovery expansion project was announced, continuing a successful partnership with a leading food and beverage company.
Negative Updates
Quarterly Revenue Decline
Revenue for the quarter was $5.8 million, reflecting a decrease of 4.1% from the previous year.
Negative EBITDA for the Quarter
EBITDA for the quarter swung to a negative $130,000 due to lower revenue and reduced gross margins.
Net Income Loss for the Quarter
Net income for the quarter showed a loss of $400,000.
Lower Order Intake
Year-to-date order intake remains behind compared to the same time last year.
Company Guidance
In the earnings call for the third quarter of fiscal year 2025, Thermal Energy International reported a decrease in quarterly revenue to $5.8 million, down 4.1% from the previous year, primarily due to lower contributions from heat recovery projects. However, year-to-date revenue was at an all-time high, 25% ahead of the previous year, with trailing 12-month revenue reaching $30.5 million—up 76% over the past two years. The company's EBITDA for the quarter was negative $130,000, but they remained EBITDA positive on a trailing 12-month basis at approximately $1.1 million. Net income for the quarter was a loss of $400,000, yet they remained profitable on a trailing 12-month basis with a net income of $230,000. The balance sheet showed cash and cash equivalents of $5.1 million and working capital of $2.4 million, alongside a reduced long-term debt of $1.4 million. Order intake for the year-to-date was $17 million, with a backlog standing at $17.1 million. Despite a temporary lull, the company's business development pipeline remains strong, and significant investments made in the past two years are expected to drive profitable growth in fiscal 2026.

Thermal Energy International Corporate Events

Financial Disclosures
Thermal Energy International to Announce Q3 2025 Financial Results
Neutral
Apr 17, 2025

Thermal Energy International Inc. announced it will release its fiscal 2025 third quarter financial results on April 29, 2025. The company will host an earnings conference call and webcast to discuss the results, providing an opportunity for equity analysts to engage with management. This announcement is part of Thermal Energy’s ongoing efforts to maintain transparency with stakeholders and could impact the company’s market positioning by showcasing its financial health and operational progress.

Spark’s Take on TSE:TMG Stock

According to Spark, TipRanks’ AI Analyst, TSE:TMG is a Neutral.

Thermal Energy International’s strengths lie in its robust revenue growth and strong cash flow, supported by strategic investments. However, challenges such as declining profitability metrics, bearish technical indicators, and a potentially overvalued stock price weigh on the overall score. The company’s recent strategic expansions and new contracts offer future growth potential, but current financial metrics reflect the need for careful management to ensure sustained profitability.

To see Spark’s full report on TSE:TMG stock, click here.

Product-Related AnnouncementsBusiness Operations and Strategy
Thermal Energy Expands Heat Recovery Project for Major Client
Positive
Apr 16, 2025

Thermal Energy International Inc. has announced a $1 million expansion project to enhance the existing heat recovery system at a major multinational food and beverage company’s American site. This project is expected to significantly reduce natural gas consumption and CO2 emissions, further solidifying Thermal Energy’s role in providing energy efficiency solutions. The expansion is set to be completed within 9 to 12 months and is anticipated to strengthen the company’s relationship with the client, opening up additional opportunities at other sites.

Spark’s Take on TSE:TMG Stock

According to Spark, TipRanks’ AI Analyst, TSE:TMG is a Neutral.

Thermal Energy International’s strengths lie in its robust revenue growth and strong cash flow, supported by strategic investments. However, challenges such as declining profitability metrics, bearish technical indicators, and a potentially overvalued stock price weigh on the overall score. The company’s recent strategic expansions and new contracts offer future growth potential, but current financial metrics reflect the need for careful management to ensure sustained profitability.

To see Spark’s full report on TSE:TMG stock, click here.

Business Operations and Strategy
Thermal Energy Secures Landmark Engineering Contract with Major Pharmaceutical Firm
Positive
Feb 11, 2025

Thermal Energy International has secured its largest engineering contract to date, valued at $500,000, with a major multinational pharmaceutical company for a potential heat recovery project. This deal marks the second significant engagement with a leading pharmaceutical company and reflects the firm’s strategic positioning in the industry. The project aligns with the pharmaceutical sector’s commitment to reducing carbon emissions, contributing to the United Nation’s Race to Zero campaign. This contract showcases Thermal Energy’s capacity to deliver extensive engineering solutions and highlights the untapped potential for large-scale heat recovery projects within the pharmaceutical industry.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.