In a world increasingly driven by automation, ATS Corporation is revolutionizing how industries operate, from life sciences to food and beverage. With a reputation for innovative solutions and exceptional quality, ATS stands at the forefront of the industrial machinery sector, delivering comprehensive automation systems that enhance productivity and efficiency. As I analyze ATS’s financial performance and market position, I must ask: do the company’s strong fundamentals continue to justify its current market valuation and growth potential?
Table of contents
Company Description
ATS Corporation, founded in 1978 and headquartered in Cambridge, Canada, specializes in providing automation solutions globally. Operating within the Industrial – Machinery sector, ATS focuses on designing, building, and servicing automated manufacturing and assembly systems. The company offers a comprehensive suite of services, including pre-automation analysis, post-automation support, and contract manufacturing, alongside software solutions for connected factory management. With a workforce of approximately 7,500 employees, ATS caters to diverse markets such as life sciences, transportation, consumer products, and energy. As a leader in automation, ATS is strategically positioned to drive operational efficiency and sustainability in its industry, shaping the future of manufacturing processes.
Fundamental Analysis
In this section, I will conduct a fundamental analysis of ATS Corporation, covering the income statement, financial ratios, and dividend payout policy.
Income Statement
The following table presents the Income Statement of ATS Corporation over the last five fiscal years, providing insights into revenue, expenses, and net income trends.
| Income Statement Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | 1.43B | 2.18B | 2.58B | 3.03B | 2.53B |
| Cost of Revenue | 1.05B | 1.57B | 1.85B | 2.18B | 1.89B |
| Operating Expenses | 265M | 426M | 503M | 540M | 637M |
| Gross Profit | 384M | 612M | 726M | 855M | 647M |
| EBITDA | 192M | 303M | 350M | 459M | 168M |
| EBIT | 121M | 187M | 224M | 317M | 15M |
| Interest Expense | 42M | 33M | 65M | 71M | 98M |
| Net Income | 64M | 122M | 127M | 194M | -28M |
| EPS | 0.70 | 1.32 | 1.39 | 1.98 | -0.29 |
| Filing Date | 2021-03-31 | 2022-03-31 | 2023-03-31 | 2024-03-31 | 2025-05-29 |
Interpretation of Income Statement
Over the past five years, ATS Corporation experienced fluctuating revenue, peaking in 2024 at 3.03B CAD, but declining to 2.53B CAD in 2025. This decline in revenue contributed to a significant drop in net income, resulting in a loss of 28M CAD in 2025. The gross profit margin has seen some contraction, indicating rising costs relative to revenue. The most recent year reflects a challenging environment, with EBITDA and EBIT both significantly down, suggesting a need for strategic adjustments to improve operational efficiency and profitability moving forward.
Financial Ratios
Here are the financial ratios for ATS Corporation over the years 2021 to 2025.
| Metrics | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Net Margin | 4.48% | 5.59% | 4.94% | 6.39% | -1.11% |
| ROE | 8.998% | 12.439% | 11.309% | 11.527% | -1.644% |
| ROIC | 7.873% | 6.531% | 7.028% | 8.031% | 0.088% |
| P/E | 38.255 | 33.944 | 40.557 | 22.947 | -125.276 |
| P/B | 3.442 | 4.222 | 4.587 | 2.645 | 2.060 |
| Current Ratio | 1.402 | 1.357 | 1.391 | 1.704 | 1.693 |
| Quick Ratio | 1.169 | 1.111 | 1.145 | 1.416 | 1.408 |
| D/E | 0.570 | 1.122 | 1.117 | 0.766 | 0.997 |
| Debt-to-Assets | 23.158% | 35.880% | 35.523% | 31.486% | 36.789% |
| Interest Coverage | 2.863 | 5.705 | 3.440 | 4.462 | 0.094 |
| Asset Turnover | 0.816 | 0.711 | 0.727 | 0.742 | 0.548 |
| Fixed Asset Turnover | 7.108 | 7.194 | 7.213 | 7.533 | 5.663 |
| Dividend Yield | 0% | 0% | 0% | 0% | 0% |
Interpretation of Financial Ratios
Analyzing ATS Corporation’s financial ratios for FY 2025 reveals several significant concerns regarding its financial health. The liquidity ratios, with a current ratio of 1.69 and a quick ratio of 1.41, are adequate, indicating the company can cover its short-term liabilities. However, the solvency ratio stands at a low 0.04, suggesting a potential risk in meeting long-term obligations. Profitability ratios are particularly troubling, with a net profit margin of -1.11%, indicating the company is operating at a loss. Additionally, the debt-to-equity ratio is high at 0.997, raising concerns about leverage. Overall, while liquidity is manageable, the company faces serious profitability and solvency challenges.
Evolution of Financial Ratios
Over the past five years, ATS Corporation’s financial ratios show a declining trend in profitability, with the net profit margin dropping from 6.39% in 2024 to -1.11% in 2025. Solvency ratios have also weakened, indicating an increasing reliance on debt and potential financial instability.
Distribution Policy
ATS Corporation does not pay dividends, reflecting a reinvestment strategy likely aimed at supporting growth and innovation. The company has been in a high-growth phase, prioritizing R&D and potential acquisitions over shareholder payouts. Despite this, ATS engages in share buybacks, which can aid in enhancing shareholder value. This approach, while focused on long-term value creation, carries risks related to financial sustainability, especially given the recent negative net income trends.
Sector Analysis
ATS Corporation operates in the Industrial – Machinery sector, providing advanced automation solutions that enhance manufacturing efficiency. Key competitors include major automation firms, while ATS’s competitive advantages lie in its comprehensive service offerings and strong market presence. A SWOT analysis reveals strengths in innovative technology, weaknesses in market dependency, opportunities in expanding sectors, and potential threats from economic fluctuations.
Strategic Positioning
As of 2025, ATS Corporation holds a competitive position in the industrial automation market, with a market cap of approximately 2.35B. The company specializes in automation solutions across various sectors including life sciences, transportation, and consumer products. While facing moderate competitive pressure from key players in the machinery industry, ATS benefits from its diverse service offerings and strong technological capabilities. However, the rapid pace of technological disruption necessitates ongoing innovation to maintain market share and address emerging customer needs effectively. Risk management remains crucial as market dynamics evolve.
Key Products
Below is a table summarizing the key products offered by ATS Corporation, which highlight their automation solutions and services across various industries.
| Product | Description |
|---|---|
| Automation Systems | Comprehensive automated manufacturing and assembly systems tailored for various sectors, including life sciences and food and beverage. |
| Pre-Automation Services | Services such as discovery and analysis, concept development, and total cost of ownership modeling to prepare clients for automation. |
| Post-Automation Services | Ongoing support including process optimization, training, and emergency maintenance to ensure systems operate efficiently. |
| Software Solutions | Connected factory floor management systems that analyze real-time machine performance data to enhance operational efficiency. |
| Contract Manufacturing | Custom manufacturing services that meet specific client needs, leveraging ATS’s expertise in automation and production. |
| Engineering Design Services | End-to-end engineering solutions, including prototyping and specification writing, to facilitate the development of automation projects. |
This overview emphasizes ATS Corporation’s commitment to delivering innovative automation solutions that drive efficiency and productivity across multiple industries.
Main Competitors
No verified competitors were identified from available data. However, ATS Corporation operates in the industrial machinery sector and is a key player in providing automation solutions globally. With a market cap of approximately 2.35B, ATS holds a competitive position in the automation industry, serving various markets including life sciences, transportation, and consumer products.
Competitive Advantages
ATS Corporation holds a strong position in the automation solutions market, which is supported by its comprehensive service offerings from planning to post-automation support. The company’s expertise in various industries, including life sciences and consumer products, positions it well for future growth. Emerging opportunities include the development of connected factory floor management systems that enhance operational efficiency. As industries increasingly seek automation to improve productivity and reduce costs, ATS is poised to capture a larger market share through innovative products and expanding into new markets.
SWOT Analysis
This SWOT analysis aims to evaluate ATS Corporation’s internal and external factors that can impact its business strategy.
Strengths
- Strong market position
- Diverse service offerings
- Experienced management team
Weaknesses
- High dependence on specific industries
- Limited brand recognition in some markets
- No dividend payouts
Opportunities
- Growing demand for automation solutions
- Expansion into emerging markets
- Technological advancements
Threats
- Intense competition
- Economic downturns
- Supply chain disruptions
Overall, ATS Corporation’s strengths position it well to leverage market opportunities, but it must address its weaknesses to mitigate potential threats. A strategic focus on diversification and market expansion could enhance its resilience and growth potential.
Stock Analysis
Over the past year, ATS Corporation’s stock has experienced significant price fluctuations, culminating in a notable decline that reflects its trading dynamics.
Trend Analysis
Analyzing the stock’s performance over the past year, I observe a percentage change of -41.08%. This indicates a bearish trend. The stock has seen notable price variations, with a highest price of 43.82 and a lowest price of 23.5. Furthermore, the trend shows deceleration, suggesting that while the stock is trending downward, the rate of decline is slowing down. The standard deviation of 4.46 highlights some volatility during this period.
Volume Analysis
In the last three months, the total trading volume for ATS Corporation reached approximately 63M shares. Buyer-driven activity accounted for 48.1% of total volume, indicating a slightly seller-dominant market, especially in recent weeks where the buyer percentage dropped to 43.08%. Overall, the volume trend appears to be increasing, which may suggest growing investor interest, although the sentiment remains cautious given the prevailing bearish trend.
Analyst Opinions
Recent analyst recommendations for ATS Corporation (ticker: ATS) indicate a cautious stance. With an overall score of 2 and a rating of “C,” the consensus suggests a hold position. Analysts highlight concerns regarding return on equity and return on assets, both scoring low at 1, which raises questions about profitability. However, the discounted cash flow score of 3 and price-to-book score of 3 suggest some underlying value. Therefore, while caution is advised, the overall sentiment leans towards holding rather than selling.
Stock Grades
In reviewing the stock ratings for ATS Corporation, it is essential to consider the insights provided by recognized grading companies.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| JP Morgan | Maintain | Neutral | 2024-08-13 |
| Goldman Sachs | Maintain | Sell | 2024-08-13 |
| JP Morgan | Maintain | Neutral | 2024-05-24 |
The overall trend in grades for ATS Corporation shows a consistent stance from both JP Morgan and Goldman Sachs, maintaining their previous ratings. This indicates a cautious investor sentiment, with a mix of neutrality and a sell recommendation suggesting that the stock may not be positioned for significant upward movement in the near term.
Target Prices
The consensus target price for ATS Corporation (ATS) indicates a stable outlook among analysts.
| Target High | Target Low | Consensus |
|---|---|---|
| 34 | 34 | 34 |
Analysts are aligned in their expectations, suggesting a target price of 34, reflecting a cautious yet optimistic view on ATS’s performance.
Consumer Opinions
Consumer sentiment around ATS Corporation (ticker: ATS) reflects a strong engagement with both praise and criticism, illustrating the diverse experiences of its clientele.
| Positive Reviews | Negative Reviews |
|---|---|
| “Excellent customer service and support.” | “Product quality has declined recently.” |
| “Innovative solutions that meet my needs.” | “High prices compared to competitors.” |
| “Fast delivery and reliable products.” | “Difficulties with returns process.” |
Overall, consumer feedback indicates that while ATS Corporation excels in customer service and innovation, it faces challenges related to product quality and pricing that some customers find unappealing.
Risk Analysis
In evaluating ATS Corporation (ticker: ATS), it is crucial to understand the potential risks that could impact the company’s performance. Below is a summary of significant risks associated with the company.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Risk | Fluctuations in market demand for ATS products. | High | High |
| Regulatory Risk | Changes in regulations affecting manufacturing. | Medium | High |
| Supply Chain Risk | Disruptions in the supply chain affecting costs. | Medium | Medium |
| Technological Risk | Rapid technological advancements by competitors. | High | Medium |
| Financial Risk | Interest rate changes impacting financing costs. | Medium | Medium |
The most pressing risks for ATS Corporation include high market volatility and regulatory changes, which could significantly affect profitability and operational capacity.
Should You Buy ATS Corporation?
ATS Corporation has reported a negative net income of -28.05M, indicating profitability challenges. The company carries a significant debt load, with total debt amounting to 1.21B CAD, which raises some concerns regarding its financial stability. In terms of fundamentals, the company has seen a decline in revenue by 16.47%, which may impact future performance. The overall rating for ATS Corporation stands at C, reflecting a cautious outlook.
Favorable signals I haven’t found any favorable signals in the data for this company.
Unfavorable signals The company has reported a negative net margin of -1.11%, indicating ongoing profitability issues. Additionally, the return on invested capital (ROIC) is 0.09%, which is below the weighted average cost of capital (WACC) of 7.16%, signaling value destruction. The stock is also experiencing a bearish long-term trend with a price change of -41.08%. Furthermore, recent seller volume exceeds buyer volume, indicating a lack of demand for the stock.
Conclusion Given the negative net margin and the fact that ROIC is below WACC, it might be prudent to wait before considering any investment in ATS Corporation.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Envestnet Asset Management Inc. Has $726,000 Position in ATS Corporation $ATS – MarketBeat (Nov 24, 2025)
- Can ATS Corporation Common Shares stock hold up in economic slowdown – July 2025 Outlook & Fast Entry and Exit Trade Plans – newser.com (Nov 21, 2025)
- (ATS) Daily Stock Insights (ATS:CA) – news.stocktradersdaily.com (Nov 23, 2025)
- ATS Corp Q2 2026 slides: revenue jumps 19%, adjusted EPS surges 80% – Investing.com (Nov 05, 2025)
- ATS Countersues Andersen After Accusations of ’Poor Management’ for Project That Ran 860 Days Late – Yahoo Finance (Nov 05, 2025)
For more information about ATS Corporation, please visit the official website: atsautomation.com
