Westaim (WED) AI Stock Analysis

• Market Cap: C$824.20M
• Dividend Yield: N/A
• Average Volume (3M): 15.40K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.66
• Revenue Growth: 333.02%
• EPS Growth: -196.36%
• Country: CA
• Employees: 7
• Sector: Financial
• Sector Strength: 70
• Industry: Asset Management
• EPS (TTM): -0.49
• Shares Outstanding: 33,382,103
• 10 Day Avg. Volume: 22,069
• 30 Day Avg. Volume: 15,400
• PEG Ratio: 0.26
• Price to Book (P/B): 0.93
• Price to Sales (P/S): 11.79
• P/FCF Ratio: -9.93
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 49 Neutral
• Price Target: C$26.00 ▼(-2.00% Downside)

The score is held down primarily by weak operating performance and ongoing cash burn (loss-making TTM with negative OCF/FCF), despite a strong balance sheet with very low leverage. Technicals are mildly supportive in the near term but longer-term trend remains below key moving averages, and valuation is difficult to support given a negative P/E. A positive executive/strategy event provides a modest offset but does not outweigh the profitability and cash-flow risk.

Positive Factors

Strategic Partnership

The partnership with CC Capital and the creation of an integrated platform enhances Westaim's market position, driving long-term growth and stability.

Regulatory Approvals

Securing regulatory approvals for the CC Capital transaction solidifies Westaim's strategic plans, ensuring compliance and facilitating future expansion.

Acquisition

The acquisition of ManhattanLife strengthens Westaim's insurance and asset management capabilities, potentially increasing market share and shareholder value.

Negative Factors

Revenue Decline

A substantial revenue drop indicates potential market or operational challenges, impacting Westaim's ability to generate consistent income.

Net Loss

The net loss reflects financial challenges and may hinder investment capacity, affecting Westaim's long-term profitability and strategic initiatives.

Negative Cash Flow

Negative cash flow highlights inefficiencies in cash generation, potentially limiting Westaim's ability to fund operations and investments sustainably.

Westaim Business Overview & Revenue Model

Company Description

The Westaim Corporation is a private equity firm specializing in direct and indirect investments through acquisitions, joint ventures, secondary investments both direct and indirect, fund of fund investments, and other arrangements. For direct investments, the firm invests in early venture, mid venture, late venture, middle market, later stage, mature, emerging growth, PIPEs, and buyout transactions. For fund of fund investments, it seeks to invest in private equity funds, venture capital funds, and hedge funds. The firm seeks to provide long term capital to businesses operating in the global financial services industry. It typically acquires controlling interests in businesses. The firm seeks to acquire debt, equity, or derivative securities of both public and private companies. It invests with the objective of providing its shareholders with capital appreciation and real wealth preservation. The firm seeks to provide its portfolio companies with advisory services including, but not limited to, advice on capital allocation, financing strategy, performance measurement and merger and acquisition support. It also seeks to partner with like-minded providers of third party capital to help supplement the firm's own capital, when completing acquisitions. The firm generally seeks to hold its investments for seven to 15 years. The Westaim Corporation was founded in 1996 and is based in Toronto, Canada.

How the Company Makes Money

Westaim makes money by investing in financial services companies with the potential for significant growth and profitability. The company generates revenue primarily through capital appreciation and dividends from its portfolio companies. Westaim's key revenue streams include returns on investments in insurance and asset management sectors. The company may also generate income through management fees or performance-based incentives from its investments. Strategic partnerships and acquisitions are significant factors contributing to Westaim's earnings, as they enable the company to enhance its investment portfolio and increase its value over time.

Westaim Financial Statement Overview

Summary

Westaim's financial performance shows a mixed picture. While the balance sheet is strong with no debt and high equity, the income statement reflects a significant revenue drop and net loss, signaling challenges. Cash flow is concerning due to negative operating cash flows, highlighting inefficiencies in cash generation.

Income Statement

The income statement reveals a significant decline in total revenue from 2023 to 2024, dropping from $211.27 million to $39.23 million. Gross profit margin is solid when revenue is positive, but net profits have turned negative in 2024 with a net loss of $16.18 million, indicating challenges in achieving profitability. Previous years showed strong EBIT and EBITDA margins; however, the recent downturn could signal underlying business or market issues.

Balance Sheet

The balance sheet is robust, with a strong equity position and zero total debt in 2024, leading to a healthy equity ratio. Stockholders' equity remains high relative to total assets, underscoring financial stability. However, the drop in stockholders' equity from 2023 to 2024 suggests asset management challenges. The absence of debt indicates low financial leverage risk.

Cash Flow

Cash flow metrics are concerning, with negative operating and free cash flows in 2024. The operating cash flow to net income ratio indicates inefficiencies in cash generation relative to income. The significant increase in investing cash flow in 2024 may have been a temporary boost but is not sustainable for operational liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	49.84M	39.23M	212.28M	27.57M	33.69M	-25.61M
Gross Profit	49.25M	39.23M	211.27M	25.67M	31.70M	-27.47M
EBITDA	-48.35M	-19.36M	186.42M	17.75M	28.58M	-34.13M
Net Income	-40.54M	-16.18M	183.98M	17.96M	28.21M	-34.40M
Balance Sheet
Total Assets	809.06M	523.22M	551.82M	413.29M	401.66M	377.35M
Cash, Cash Equivalents and Short-Term Investments	412.97M	301.91M	135.03M	3.43M	6.56M	8.74M
Total Debt	7.54M	0.00	128.00K	261.00K	413.00K	541.00K
Total Liabilities	133.78M	25.80M	33.48M	50.22M	53.98M	56.83M
Stockholders Equity	671.33M	497.41M	518.35M	363.07M	347.68M	320.52M
Cash Flow
Free Cash Flow	-57.88M	-46.57M	-3.09M	-2.46M	-5.13M	18.51M
Operating Cash Flow	-54.36M	-46.57M	-3.09M	-2.46M	-5.12M	18.54M
Investing Cash Flow	-82.75M	223.11M	198.89M	1.90M	3.99M	-32.04M
Financing Cash Flow	191.48M	-9.67M	-64.20M	-2.56M	-1.05M	0.00

Westaim Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 26.53
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:WED, the sentiment is Negative. The current price of 26.53 is above the 20-day moving average (MA) of 25.95, above the 50-day MA of 24.69, and below the 200-day MA of 28.70, indicating a neutral trend. The MACD of 0.08 indicates Positive momentum. The RSI at 43.74 is Neutral, neither overbought nor oversold. The STOCH value of 13.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:WED.

Westaim Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AGF.B	78 Outperform	C$1.08B	9.66	9.85%	3.01%	11.23%	30.44%
SEC	74 Outperform	C$931.72M	5.33	9.11%	―	22.33%	-25.06%
QRC	73 Outperform	C$612.60M	3.78	36.24%	2.20%	-1.35%	496.34%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
FSZ	62 Neutral	C$652.53M	21.01	11.26%	8.78%	-0.88%	-52.30%
CVG	57 Neutral	C$989.27M	300.63	0.32%	0.14%	-44.78%	-95.84%
WED	49 Neutral	C$824.20M	-10.44	-6.98%	―	333.02%	-196.36%

Westaim Corporate Events

Westaim Grants Equity Awards to Ceres Life Executives and Revises Change-of-Control Terms

Westaim Corporation has granted 1,578,258 stock options and 124,812 restricted share units under its long-term equity incentive plan to certain officers of its affiliate Ceres Life Insurance Company, with the awards subject to a mix of time-based, operational performance and share price vesting conditions over multiple years. The company has also amended the change-of-control provisions of its incentive plan so that any acquisition of Westaim securities by CC Capital Partners, LLC or its affiliates will only trigger those provisions at an 85% ownership threshold, a move that fine-tunes governance and control mechanics around future equity awards and may influence expectations around potential strategic transactions or ownership changes involving that investor.

Westaim Appoints Andrew Rabinowitz to Lead Arena Investors Group Holdings

The Westaim Corporation has appointed Andrew Rabinowitz as President and General Counsel of Arena Investors Group Holdings, following a strategic integration with CC Capital. Rabinowitz, with over 30 years of experience in asset management, is expected to enhance AIGH’s operations and growth, particularly in its alternative asset management and insurance platform, Arena Life & Annuities Solutions, positioning the company for significant market opportunities.

Westaim Reports Q3 2025 Loss Amid Strategic Restructuring and Product Launches

Westaim reported a net loss of $11.7 million for Q3 2025, largely due to its insurance segment’s scaling efforts. The company launched multi-year guaranteed annuities through Ceres, which received positive feedback for its technology and service platform. Arena Investors began managing Ceres’ investment portfolio, and regulatory approval was received for launching fixed income annuities in early 2026. Restructuring efforts, including closing the Singapore office and winding down non-core businesses, are expected to yield significant cost savings. Despite the current losses, Westaim is focused on executing its business plan and scaling its platform.