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Summary
- Aecon registered a gross profit of C$ 162.2 million for the third quarter of 2020, up by 34.5 per cent YoY.
- First Quantum Minerals posted a gross profit of C$ 346 million for Q3 2020 compared to C$ 150 million for Q3 2019.
- First Quantum stocks skyrocketed over 203 per cent since the pandemic-led crash on March 24.
Many TSX-listed companies have started reporting their earnings for the third quarter 2020. Among the long list of firms include construction group Aecon Group Inc. (TSX:ARE), and mining and minerals firm First Quantum Minerals Ltd. (TSX:FM).
Canada’s economy registered a 1.2 per cent growth in August, as per Statistics Canada. The agency also announced an estimate for September, which indicates a 0.7 per cent increase in the gross domestic product (GDP). If achieved, it will be the fifth straight month of growing GDP figure, indicating an economic recovery from a steep contraction from the pandemic-led shutdowns.
The construction sector grew 1.5 per cent in August, up for the fourth successive month. Most subsectors expanded, taking the construction activity to within 2 per cent of February's pre-COVID-19 stage.
Overall mining and extracting (except oil and gas) declined 2.2 per cent in August. Potash mining dropped by 21.7 per cent drop, higher metal ore gained 0.7 per cent and coal mining was up 3.7 per cent.
In this article, we will look at the financial health and stock performance of Aecon and First Quantum:
Aecon Group Inc. (TSX:ARE)
Current Stock Price: C$ 14.22
Toronto-based Aecon Group Inc is an infrastructure and construction firm operating in the range of sectors including civil, utilities, industrial, urban transportation systems, nuclear and concessions.
The group posted revenue of C$ 1.04 billion for the third quarter of fiscal 2020, a marginal increase of 1 per cent compared to the third quarter of 2019. The company registered a gross profit of C$ 162.2 million for Q3 2020, soared by nearly 34.5 per cent from C$ 120.6 million in Q3 2019. The company reported an adjusted EBITDA of C$ 137.2 million for Q3 2020 from C$ 91.1 million in Q3 2019. These gains were partially offset by lesser revenue from Nuclear operations i.e. C$ 79 million.
Aecon’s announced the next quarterly cash dividend of C$ 0.16 per share. The dividend will be paid to its shareholders as of December 25, 2020. Its dividend yield is 4.501 per cent.
Aecon Stock Performance
Aecon’s stock has rebounded by 28.08 per cent since the pandemic-led market crash on March 24. The stock is up 1.31 per cent in the last three months. The construction stock’s year-to-date scrips registered a 19.25 per cent decline. Aecon’s current market capitalization stands at C$ 851.46 million.
Aecon's Year-To-Date Stock Performance Chart / Source: EODHD/Others, Thomson Reuters
Aecon’s price-to-book ratio is 1.056, and the price to cash flow ratio is 5.6. Its current debt-to-earnings ratio is 0.98, as per TMX data. The stock offers a 5.46 per cent return on equity, and Its return on assets is 1.45 per cent. The company’s earnings per share is 0.73. Its price-to-earnings ratio is 19.50.
First Quantum Minerals Ltd. (TSX:FM)
Current Stock Price: C$ 15.31
Toronto-based First Quantum Minerals produces copper, nickel, gold, zinc, and sulfuric acid. The company is operating in Zambia, Finland, Mauritania, Turkey, and Spain.
The company reported its sales revenues of C$ 1,402 million for the third quarter of 2020, an increase of 42 per cent from Q3 2019.
The company posted a gross profit of C$ 346 million for Q3 2020 compared to C$ 150 million for Q3 2019. First Quantum registered a comparative EBITDA of C$ 641 million for the quarter compared to C$ 354 million for Q3 2019. The company’s net debt decreased during Q3 2020 by C$ 113 million to C$ 7,545 million.
First Quantum Stock Performance
First Quantum’s 10-day average trading volume is 3.16 million units. The minerals stock has been placed among the most actively traded stocks across the TSX and TSXV in the last 10 days, as per data on the TMX website. The stock ranks on TMX’s Top Price Performers, a list of stocks across board with largest price gains in the past 30 days.
Shares of the company have skyrocketed over 203 per cent since the pandemic-led crash on March 24 and are up 35.24 per cent in the last three months. The company scrips are trading 16.07 per cent up year-to-date (YTD). First Quantum’s current market capitalization stands at C$ 10.554 billion.
The company has a dividend yield of 0.065 per cent. It pays the semi-annual cash dividend of C$ 0.005 per common share.
The stock’s price-to-book ratio is 0.86, and its price-to-cashflow ratio is 6.70. Its current debt-to-earnings ratio is 0.93, according to TMX data.
