Westaim (WED) AI Stock Analysis

• Market Cap: C$989.77M
• Dividend Yield: N/A
• Average Volume (3M): 19.07K
• Price to Earnings (P/E): 12.7
• Beta (1Y): 0.50
• Revenue Growth: 100.87%
• EPS Growth: -110.30%
• Country: CA
• Employees: 7
• Sector: Financial
• Sector Strength: 72
• Industry: Asset Management
• EPS (TTM): -0.46
• Shares Outstanding: 33,551,510
• 10 Day Avg. Volume: 12,786
• 30 Day Avg. Volume: 19,069
• PEG Ratio: 0.03
• Price to Book (P/B): 0.98
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -18.87
• Enterprise Value/Market Cap: 0.50
• Enterprise Value/Revenue: 2.08
• Enterprise Value/Gross Profit: 94.21
• Enterprise Value/Ebitda: 15.27
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 61 Neutral
• Price Target: ―

Westaim's overall stock score reflects a combination of strong strategic initiatives and concerning financial performance. Although the company has a robust balance sheet, recent financial results show revenue declines and net losses, impacting its valuation negatively. However, significant corporate events and partnerships provide a positive outlook, suggesting potential for growth and improved market positioning in the asset management industry.

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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	39.23M	211.27M	25.67M	31.70M	-27.47M
Gross Profit	39.23M	209.76M	25.67M	31.70M	-27.47M
EBITDA	-19.36M	187.80M	19.38M	26.36M	-32.00M
Net Income	-16.18M	183.98M	17.96M	28.21M	-34.40M
Balance Sheet
Total Assets	523.22M	551.82M	413.29M	401.66M	377.35M
Cash, Cash Equivalents and Short-Term Investments	301.91M	521.76M	3.43M	6.56M	8.74M
Total Debt	0.00	128.00K	261.00K	413.00K	541.00K
Total Liabilities	25.80M	33.48M	50.22M	53.98M	56.83M
Stockholders Equity	497.41M	518.35M	363.07M	347.68M	320.52M
Cash Flow
Free Cash Flow	-46.57M	-3.09M	-2.46M	-5.13M	18.51M
Operating Cash Flow	-46.57M	-3.09M	-2.46M	-5.12M	18.54M
Investing Cash Flow	223.11M	6.67M	1.90M	3.99M	-32.04M
Financing Cash Flow	-9.67M	-64.20M	-2.56M	-1.05M	0.00

Westaim Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 29.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

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 29.5 is below the 20-day moving average (MA) of 30.47, below the 50-day MA of 31.28, and below the 200-day MA of 30.65, indicating a bearish trend. The MACD of -0.40 indicates Positive momentum. The RSI at 34.61 is Neutral, neither overbought nor oversold. The STOCH value of 39.48 is Neutral, 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
EIF	78 Outperform	C$3.40B	25.50	9.16%	4.13%	5.95%	-1.42%
ONEX	72 Outperform	C$7.91B	13.26	5.40%	<0.01%	-10.83%	-34.83%
GCG	71 Outperform	C$1.04B	15.07	5.62%	4.49%	35.78%	-24.67%
BAM	70 Neutral	C$136.84B	43.54	18.95%	2.68%	283.20%	33.30%
Sector *	68 Neutral	$17.10B	11.44	9.70%	3.58%	11.11%	-4.78%
FSZ	65 Neutral	C$725.47M	18.90	13.09%	11.15%	3.59%	-43.99%
WED	61 Neutral	C$989.77M	12.73	-9.16%	―	100.87%	-110.30%

Westaim Corporate Events

Westaim Announces Investor Day and Shareholders Meeting for June 2025

Westaim Corporation announced its Annual Investor Day and Shareholders Meeting scheduled for June 12, 2025, in Toronto, Canada. The event will feature a business overview and discussions with management teams from Westaim, Arena, Ceres Life Insurance Company, and CC Capital Partners, followed by a Q&A session. This initiative reflects Westaim’s commitment to transparency and engagement with its stakeholders, potentially enhancing its market position and shareholder relations.

Spark’s Take on TSE:WED Stock

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

Westaim’s stock score reflects mixed financial performance with strong balance sheet but declining revenues and profits. Technical indicators point to a bearish trend, and valuation suggests overvaluation. However, strategic corporate events such as the CC Capital deal are positive, potentially offsetting some financial and technical concerns. The overall outlook requires cautious optimism with an eye on strategic execution.

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

Westaim and CC Capital Finalize Transformative Insurance and Asset Management Deal

Westaim Corporation, in partnership with CC Capital, has completed a significant transaction that transforms it into an integrated insurance and asset management platform. This strategic move, supported by a $250 million investment from CC Capital, brings together Westaim, Arena Investors, and Ceres Life Insurance Company to create a unified platform expected to drive growth and stability. The transaction is anticipated to generate significant value for shareholders and redefine the annuities industry by providing scalable, cloud-native solutions. The new structure includes key leadership appointments and board expansions, positioning Westaim for long-term growth and enhanced service delivery to retirees and investors.

Westaim Secures Regulatory Approvals for CC Capital Transaction

Westaim Corporation has announced the receipt of all necessary regulatory approvals for its proposed transaction with CC Capital Partners, which is expected to close around April 2, 2025. This transaction is a crucial step in Westaim’s strategy to build an integrated insurance and asset management platform, potentially enhancing its market position and offering significant implications for stakeholders.

Westaim Corporation Reports 2024 Financial Results Amid Strategic Restructuring

Westaim Corporation reported a net loss of $21.3 million for Q4 2024 and $16.2 million for the full year, contrasting with profits in the previous year. The company is undergoing significant changes, including a strategic $250 million investment agreement with CC Capital and a jurisdictional shift from Alberta to Delaware. These developments, along with financial restructuring, aim to enhance Westaim’s market position and operational efficiency, although the immediate financial results reflect challenges.

Westaim Completes Acquisition of ManhattanLife Insurance

Westaim Corporation has completed its acquisition of ManhattanLife of America Insurance Company through its partnership with CC Capital Partners. This acquisition is a strategic move to build an integrated insurance and asset management platform, enhancing Westaim’s presence in the financial services industry and potentially impacting its market positioning and shareholder value.