Velan Inc. SV (VLN) AI Stock Analysis

• Market Cap: C$304.57M
• Dividend Yield: 0.85%
• Average Volume (3M): 19.82K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.31
• Revenue Growth: 7.64%
• EPS Growth: -2.26%
• Country: CA
• Employees: 1,617
• Sector: Industrials
• Sector Strength: 86
• Industry: Industrial - Machinery
• EPS (TTM): -0.82
• Shares Outstanding: 6,019,000
• 10 Day Avg. Volume: 13,172
• 30 Day Avg. Volume: 19,821
• PEG Ratio: >-0.01
• Price to Book (P/B): 1.01
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -33.20
• Enterprise Value/Market Cap: 0.44
• Enterprise Value/Revenue: 0.09
• Enterprise Value/Gross Profit: 1.15
• Enterprise Value/Ebitda: 13.45
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 62 Neutral
• Price Target: ―

Velan Inc.'s stock score reflects a mix of financial challenges and strategic improvements. Significant factors include financial instability with negative earnings but some cash flow improvements. Technical analysis shows positive momentum, while strategic initiatives like selling subsidiaries improve the financial outlook. However, valuation concerns remain due to negative profitability. The overall score of 62 indicates a moderate outlook with potential for improvement.

Velan Inc. SV Business Overview & Revenue Model

Company Description

Velan Inc. (VLN) is a global leader in the design, manufacturing, and marketing of industrial valves for a range of applications within sectors such as oil and gas, power generation, chemical, and mining. The company is renowned for its innovative and high-quality valve solutions, which include a wide variety of products such as gate, globe, check, ball, butterfly, and engineered severe service valves.

How the Company Makes Money

Velan Inc. generates revenue primarily through the sale of its industrial valve products to various industries worldwide. The company's revenue streams are primarily composed of product sales to end-users, distributors, and through direct contracts with significant players in sectors like oil and gas and power generation. Velan also benefits from long-term supply agreements and strategic partnerships with major industrial companies, which ensure steady demand for its products. Additionally, the company invests in research and development to continuously innovate and improve its product offerings, helping to maintain a competitive edge in the market.

Velan Inc. SV Financial Statement Overview

Summary

Velan Inc. SV is facing financial challenges with declining profitability and operational inefficiencies. The income statement shows negative margins, the balance sheet indicates moderate leverage with poor profitability, and cash flow shows some improvement but with volatility risks. Overall, the financial outlook is mixed with potential risks and some optimism from improved cash flow generation.

Income Statement

Velan Inc. SV's income statement shows declining revenue and profitability. The TTM data indicates a negative gross margin and net profit margin, suggesting significant cost challenges and inefficiencies. Revenue has seen a minor increase from the previous year, but profitability remains a concern with negative EBIT and EBITDA margins.

Balance Sheet

The balance sheet reveals a moderate debt-to-equity ratio, indicating some leverage but not excessively high. However, the return on equity is negative, reflecting poor profitability relative to shareholder equity. The equity ratio signals a stable capital structure but highlights reduced equity over time.

Cash Flow

Velan's cash flow shows improvement in operating cash flow compared to net income, indicating better operational efficiency. Free cash flow is positive in the TTM, a favorable sign for liquidity. However, the volatility in free cash flow growth rate poses risks to future cash reserves.

Breakdown	TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	367.44M	346.82M	370.43M	411.24M	302.06M	371.63M
Gross Profit	117.17M	93.21M	112.47M	134.97M	80.54M	88.13M
EBITDA	-36.29M	5.64M	-34.65M	50.61M	11.83M	7.53M
Net Income	-65.16M	-19.74M	-55.46M	-10.26M	2.20M	-16.60M
Balance Sheet
Total Assets	510.39M	479.39M	477.86M	508.43M	580.83M	538.50M
Cash, Cash Equivalents and Short-Term Investments	35.42M	41.72M	50.55M	62.74M	74.97M	75.95M
Total Debt	25.24M	41.42M	40.91M	44.02M	84.05M	80.34M
Total Liabilities	393.59M	296.13M	277.02M	242.92M	280.61M	253.63M
Stockholders Equity	115.87M	182.18M	199.89M	264.82M	297.08M	281.18M
Cash Flow
Free Cash Flow	22.02M	-4.94M	-6.07M	9.25M	-20.00M	-2.44M
Operating Cash Flow	34.69M	4.30M	522.00K	17.87M	-9.10M	9.64M
Investing Cash Flow	-17.46M	-14.13M	1.76M	-26.00K	2.90M	-11.68M
Financing Cash Flow	-6.77M	-4.66M	-2.62M	-23.52M	33.10M	-6.30M

Velan Inc. SV Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 14.11
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:VLN, the sentiment is Negative. The current price of 14.11 is above the 20-day moving average (MA) of 13.99, below the 50-day MA of 15.10, and above the 200-day MA of 13.14, indicating a neutral trend. The MACD of -0.21 indicates Negative momentum. The RSI at 46.08 is Neutral, neither overbought nor oversold. The STOCH value of 15.29 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:VLN.

Velan Inc. SV Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PSI	77 Outperform	C$989.67M	13.92	14.68%	4.12%	12.43%	-44.90%
CEU	76 Outperform	$1.54B	8.86	23.66%	2.44%	8.79%	31.76%
TCW	75 Outperform	C$960.31M	10.38	19.44%	3.72%	2.15%	-5.97%
PD	74 Outperform	$929.76M	8.73	6.58%	―	-1.90%	-52.33%
GEI	73 Outperform	$3.89B	23.96	17.23%	7.23%	-5.85%	-8.05%
VLN	62 Neutral	C$304.57M	―	-46.86%	0.85%	7.64%	-2.26%
Sector *	61 Neutral	C$6.56B	9.38	3.44%	2.88%	6.99%	-11.09%

Velan Inc. SV Corporate Events

Velan Inc. Completes Sale of French Subsidiaries to Framatome

Velan Inc. announced the completion of the sale of its French subsidiaries, Segault SAS and Velan S.A.S., to Framatome SAS for a total consideration of $208.4 million. The proceeds from this transaction will be used to fund the permanent divestiture of Velan’s asbestos-related liabilities, enhancing the company’s financial position and potentially impacting its market strategy.

Velan Inc. Shareholders Approve Sale of French Subsidiaries

Velan Inc. announced that its shareholders have approved the sale of its French subsidiaries, Segault and Velan S.A.S., to Framatome SAS for a total consideration of US$201.1 million. This transaction is part of Velan’s strategy to use the proceeds to divest its asbestos-related liabilities. The approval was unanimous among voting shareholders, and the transaction is expected to close in the coming weeks, pending customary closing conditions.

Velan Inc. Reports Strong Q3 Results and Strategic Divestitures

Velan Inc. reported strong financial results for its fiscal 2025 third quarter, driven by effective management of a robust order backlog. The company has entered into an agreement to divest its asbestos-related liabilities, enhancing its balance sheet by transferring these liabilities to a new subsidiary and selling its U.S. subsidiary, Velan Valve Corp. Additionally, Velan’s subsidiary, Velan UK, has signed a memorandum of understanding to sell its French subsidiaries to Framatome SAS, a leader in nuclear energy, for $198.4 million. This transaction has been reflected in the company’s balance sheet as assets held for sale, streamlining its operations and focusing on continuing operations.

Velan Inc. Unveils Strategic Initiatives to Strengthen Financial Position

Velan Inc. announced significant strategic initiatives aimed at reducing operational and financial risks while strengthening its financial standing. The company has agreed to divest its asbestos-related liabilities to Global Risk Capital for $143 million and entered exclusive negotiations with Framatome to sell its French subsidiaries for $175.2 million. These transactions are expected to make Velan nearly debt-free, enabling greater investment in growth opportunities and enhancing shareholder value. Velan remains focused on executing its strategic plan to drive sustained profitable growth and capitalize on the momentum in the clean energy sector.