Dorel Class B (DII.B) AI Stock Analysis

• Market Cap: $53.42M
• Dividend Yield: N/A
• Average Volume (3M): 26.90K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.13
• Revenue Growth: 0.83%
• EPS Growth: -181.58%
• Country: CA
• Employees: 3,600
• Sector: Consumer Cyclical
• Sector Strength: 58
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): -7.28
• Shares Outstanding: 28,490,007
• 10 Day Avg. Volume: 26,359
• 30 Day Avg. Volume: 26,900
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.05
• Price to Cash Flow (P/CF): 0.40
• P/FCF Ratio: 0.30
• 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: $1.99
• Price Target Upside: 21.54% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 1

Dorel Industries is currently in a challenging financial position, with declining revenues, persistent losses, and a weakening balance sheet. Although there are positive developments such as improved cash flow and strategic restructuring efforts, the company's high leverage and liquidity concerns present significant risks. The technical analysis further indicates a bearish trend, and valuation metrics are unattractive due to ongoing losses. Overall, Dorel faces substantial headwinds that need to be addressed for a positive turnaround.

Dorel Class B Business Overview & Revenue Model

Company Description

Dorel Industries Inc. Class B (DII.B) is a global consumer products company operating in three distinct segments: Dorel Home, Dorel Juvenile, and Dorel Sports. The company designs and manufactures a diverse range of products, including home furniture, juvenile products, and recreational and leisure bicycles. Dorel leverages its global distribution network to reach customers across North America, Europe, Latin America, and Asia.

How the Company Makes Money

Dorel Industries Inc. generates revenue through the sale of its products in the home, juvenile, and sports segments. In the Dorel Home segment, the company makes money by manufacturing and selling a wide array of ready-to-assemble furniture products to mass merchants and online retailers. Dorel Juvenile contributes to the company's earnings by offering products such as car seats, strollers, and other juvenile safety and convenience items, primarily sold through retail partners and direct-to-consumer channels. The Dorel Sports segment earns revenue by designing and distributing bicycles and related accessories under various brands, catering to both mass market and specialty retailers. The company's earnings are further supported by strategic partnerships and licensing agreements that enhance brand visibility and distribution capabilities globally.

Dorel Class B Financial Statement Overview

Summary

Dorel Class B faces significant financial challenges, with declining revenues, persistent net losses, and a weakening balance sheet. While recent improvements in cash flow provide some hope, the company's high leverage and decreasing equity raise concerns about long-term viability. Continued focus on revenue stabilization and cost management is crucial for financial recovery.

Income Statement

The company has faced declining revenues with a significant drop from 2020 to 2024. The gross profit margin remains relatively stable around 17-19% in recent years, which is a slight improvement from earlier periods. However, the net profit margin is negative, reflecting ongoing losses, and the EBIT and EBITDA margins are also negative, indicating operational challenges.

Balance Sheet

The balance sheet shows a concerning trend with diminishing stockholders' equity, dropping from $534 million in 2019 to $42 million in 2024. The debt-to-equity ratio is alarmingly high due to the shrinking equity base, posing a risk of financial instability. The equity ratio has also decreased significantly over the years, highlighting reduced financial robustness.

Cash Flow

Despite negative free cash flow in earlier years, the company has improved its cash flow position recently, with positive free cash flow in 2024. The operating cash flow to net income ratio is positive, indicating that operational activities generate cash despite net losses. However, the sustainability of these improvements is uncertain given the company's broader financial challenges.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.38B	1.39B	1.57B	1.76B	2.76B
	Gross Profit
246.04M	243.78M	205.01M	294.37M	568.62M
	EBIT
-91.03M	-52.20M	-90.30M	66.00K	116.52M
	EBITDA
-23.40M	17.31M	-34.14M	68.92M	87.49M
	Net Income Common Stockholders
-171.96M	-62.35M	-118.91M	-111.83M	-43.40M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
41.27M	24.09M	32.41M	52.17M	38.23M
	Total Assets
802.79M	1.00B	1.06B	1.85B	1.72B
	Total Debt
366.79M	392.95M	431.57M	544.38M	613.35M
	Net Debt
325.52M	368.87M	399.16M	492.21M	575.12M
	Total Liabilities
760.65M	776.23M	779.30M	1.38B	1.22B
	Stockholders Equity
42.14M	224.70M	281.14M	469.00M	496.21M
Cash Flow		Free Cash Flow
38.77M	53.38M	-160.66M	-16.45M	100.82M
	Operating Cash Flow
62.37M	76.93M	-133.01M	19.82M	134.53M
	Investing Cash Flow
-17.60M	-20.54M	734.89M	14.14M	-27.26M
	Financing Cash Flow
-24.39M	-65.95M	-608.38M	-23.69M	-109.80M

Dorel Class B Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.64
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DII.B, the sentiment is Negative. The current price of 1.64 is below the 20-day moving average (MA) of 1.83, below the 50-day MA of 3.05, and below the 200-day MA of 4.91, indicating a bearish trend. The MACD of -0.41 indicates Negative momentum. The RSI at 35.52 is Neutral, neither overbought nor oversold. The STOCH value of 68.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:DII.B.

Dorel Class B Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TCL.A	71 Outperform	C$1.48B	9.19	8.50%	5.08%	-4.75%	68.04%
GIL	68 Neutral	$8.64B	16.89	23.48%	2.04%	4.03%	-16.63%
TOY	62 Neutral	C$2.26B	20.37	5.82%	2.17%	20.89%	-43.13%
Sector *	59 Neutral	$6.44B	11.30	3.27%	4.27%	2.37%	-21.19%
CIX	51 Neutral	C$4.49B	―	-55.59%	2.56%	3.21%	-9107.07%
DOO	45 Neutral	$3.28B	19.66	-3.01%	1.88%	-23.54%	-130.34%
DII.B	40 Underperform	$53.42M	―	-128.88%	―	0.83%	-181.58%

Dorel Class B Corporate Events

Dorel Industries Reports Q4 Loss Amid Restructuring Efforts

Dorel Industries Inc. reported a decrease in fourth-quarter revenue to US$326.8 million, with a significant net loss attributed to restructuring costs and tax asset write-downs. Despite these challenges, the company saw market share gains in the Juvenile segment, while the Home segment is undergoing a restructuring program to realign its business operations.

Dorel Industries Secures $30 Million Through Strategic Sale-Leaseback

Dorel Industries Inc. has announced a sale-leaseback transaction of its factory in Columbus, Indiana, aiming to raise US$30 million. This transaction is designed to support the growth of its Juvenile segment and the turnaround of its Home segment. The transaction, involving key company executives with an ownership interest in the purchaser, was approved by the independent board members under the MI 61-101 exemption due to Dorel’s financial difficulties. The funds will be used to reduce existing debt and support ongoing operations.

Dorel Industries Announces Strategic Restructuring of Home Segment

Dorel Industries Inc. has announced a significant restructuring of its Home segment to realign with current industry dynamics and future expectations. This move reflects the company’s strategy to navigate challenges in the post-pandemic furniture industry, including supply chain uncertainties and changing consumer spending priorities. Initiatives include workforce downsizing, manufacturing operations closure in Montreal, and SKU reductions, aiming to achieve profitability by focusing on core competencies and leveraging retailer relationships.