ATS (NYSE:ATS) Posts Earnings Results, Misses Expectations By $0.03 EPS

ATS (NYSE:ATS) issued its earnings results on Wednesday. The company reported $0.19 earnings per share for the quarter, missing the consensus estimate of $0.22 by ($0.03), Zacks reports. ATS had a net margin of 1.60% and a return on equity of 8.96%. During the same quarter last year, the firm posted $0.45 earnings per share. The firm’s revenue for the quarter was down 8.6% compared to the same quarter last year.

Here are the key takeaways from ATS’s conference call:

• Bookings rose 12.7% year over year to CAD 827 million, and backlog reached approximately CAD 2 billion. Life sciences backlog hit a record CAD 1.2 billion, supported by radiopharma and medical-device orders, though management said longer project timelines mean the bookings will take time to convert into revenue.
• ATS no longer expects to achieve its fiscal 2027 goals for modest revenue growth and margin expansion, citing delayed orders, lower volumes and unfavorable mix. It forecast Q3 revenue of CAD 640 million to CAD 680 million and expects near-term margin pressure.
• The company is targeting CAD 65 million to CAD 75 million in annualized net savings from its Fixed Cost Transformation Program, with benefits expected to build as implementation continues over the next 15 months. Actions announced so far include facility closures and a workforce reduction of 300 to 400, while ATS says it is adding capacity in growth areas such as radiopharma.
• Section 338 tariffs delayed packaging-equipment orders from Canadian facilities to U.S. customers, but U.S. modifications announced in late October removed the tariffs from nearly all affected products. Management sees potential for orders to resume but did not quantify the timing or value.
• Net debt to adjusted EBITDA rose to 3.1 times, above ATS’s target range of two to three times, reflecting lower trailing EBITDA and CAD 61 million of share repurchases. The company expects to remain moderately above its target range for the rest of fiscal 2027, absent acquisitions or portfolio actions.

ATS Price Performance

Shares of ATS stock traded down $1.75 during mid-day trading on Wednesday, reaching $17.21. The stock had a trading volume of 247,950 shares, compared to its average volume of 200,110. The company has a current ratio of 1.63, a quick ratio of 1.33 and a debt-to-equity ratio of 0.75. The business has a 50-day simple moving average of $18.79 and a 200 day simple moving average of $26.50. ATS has a 12-month low of $17.15 and a 12-month high of $35.82. The company has a market cap of $1.65 billion, a P/E ratio of 50.62 and a beta of 1.15.

Analyst Ratings Changes

Several brokerages have commented on ATS. Wall Street Zen lowered shares of ATS from a “buy” rating to a “hold” rating in a research note on Sunday, July 12th. Zacks Research upgraded shares of ATS from a “strong sell” rating to a “hold” rating in a research report on Monday, October 19th. Weiss Ratings cut shares of ATS from a “hold (c-)” rating to a “sell (d+)” rating in a report on Friday, September 25th. Finally, TD Securities downgraded shares of ATS from a “buy” rating to a “hold” rating in a research report on Monday, August 10th. Three equities research analysts have rated the stock with a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, ATS currently has an average rating of “Hold” and a consensus price target of $42.50.

ATS Company Profile

ATS Corporation is a Canadian automation solutions provider headquartered in Cambridge, Ontario. The company designs, builds and services automated manufacturing systems, production equipment and related technologies for manufacturers in a range of industries.

Its offerings include custom automation systems, assembly and test equipment, material-handling solutions, packaging systems, precision components and aftermarket services. ATS also provides automation software, controls, engineering, technical support and lifecycle services intended to improve production efficiency, quality and flexibility.

The company serves customers in sectors including life sciences, transportation, energy, consumer products and industrial manufacturing.