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Firan Tech (TSE:FTG)
:FTG

Firan Tech (FTG) AI Stock Analysis

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Firan Tech

(TSX:FTG)

65Neutral
FTG's overall score reflects strong financial performance and growth potential, driven by revenue increases and strategic acquisitions. However, technical indicators suggest bearish momentum, and valuation metrics are moderate with no dividend yield. The earnings call provided positive guidance, but challenges remain in margin improvement and potential tariff impacts.

Firan Tech (FTG) vs. S&P 500 (SPY)

Firan Tech Business Overview & Revenue Model

Company DescriptionFiran Technology Group Corp is a supplier of aerospace and defense electronic products and subsystems. The company has two operating segments namely FTG Circuits and FTG Aerospace. FTG Circuits manufactures printed circuit boards within the global marketplace. FTG Aerospace designs and manufactures illuminated cockpit panels, keyboards, bezels, subassemblies, and assemblies for original equipment manufacturers of avionics products and for airframe manufacturers. The company operates in Canada, the United States, Asia, and Europe and generates major sales from the United States.
How the Company Makes MoneyFTG generates revenue primarily through the design, manufacture, and sale of high-reliability printed circuit boards and cockpit systems used in aerospace and defense applications. The company has two main business units: Circuits and Aerospace. The Circuits division specializes in producing complex PCBs for applications requiring high precision and reliability, catering to industries like aerospace, defense, and high-tech. The Aerospace division focuses on the design and development of advanced cockpit systems and components, often working under long-term contracts and partnerships with major aerospace and defense companies. Revenue is driven by both direct sales to OEMs (Original Equipment Manufacturers) and through maintenance, repair, and overhaul services. Strategic partnerships with key players in the aerospace industry also contribute to FTG's earnings, enabling the company to expand its market reach and enhance its product offerings.

Firan Tech Financial Statement Overview

Summary
Firan Tech demonstrates strong growth potential with increasing revenues and efficient cash flow management. Despite some declining margins, the company maintains a healthy balance sheet and leverage position. Continued focus on margin improvement and debt management will bolster financial stability.
Income Statement
78
Positive
Firan Tech has shown a strong revenue growth trajectory, with revenue increasing from $135.2 million in 2023 to $162.1 million in 2024, a growth rate of 19.91%. However, gross profit margin has slightly declined from 33.9% in 2023 to 27.2% in 2024. The net profit margin also decreased slightly to 6.67% from 8.6% in the previous year. EBITDA margin remains relatively robust at 15.88%, although there was a decline in EBIT margin to 0% due to no recorded EBIT.
Balance Sheet
72
Positive
The company maintains a moderate debt-to-equity ratio of 0.49, indicating a balanced leverage position. Return on equity stands at 14.99% for 2024, reflecting a solid return for shareholders. The equity ratio is stable at 53.46%, indicating a healthy proportion of equity financing. However, the increase in total debt from the previous year might be a point of concern.
Cash Flow
80
Positive
Strong free cash flow growth of 44.23% from 2023 to 2024 highlights efficient cash generation. The operating cash flow to net income ratio is robust at 1.31, demonstrating effective cash flow management. The free cash flow to net income ratio of 0.64 indicates good cash utilization, although there's room for improvement.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
162.10M135.20M89.62M79.36M102.44M
Gross Profit
44.18M45.83M21.31M17.13M26.42M
EBIT
0.0021.72M2.49M751.00K7.60M
EBITDA
25.73M22.26M7.92M8.42M10.69M
Net Income Common Stockholders
10.81M11.62M698.00K170.00K1.39M
Balance SheetCash, Cash Equivalents and Short-Term Investments
9.96M6.62M15.67M20.20M19.03M
Total Assets
134.98M125.71M83.75M79.45M86.68M
Total Debt
35.31M35.18M13.59M12.94M18.86M
Net Debt
25.35M28.56M-2.08M-7.26M-168.00K
Total Liabilities
62.14M65.38M34.45M28.41M35.39M
Stockholders Equity
72.15M59.53M48.33M50.10M50.28M
Cash FlowFree Cash Flow
6.88M4.77M-1.05M4.73M12.56M
Operating Cash Flow
14.13M11.30M11.26M7.63M15.78M
Investing Cash Flow
-7.24M-23.77M-12.02M-2.95M-2.87M
Financing Cash Flow
-4.34M3.57M-1.73M-2.70M-1.17M

Firan Tech Technical Analysis

Technical Analysis Sentiment
Negative
Last Price6.94
Price Trends
50DMA
7.72
Negative
100DMA
7.53
Negative
200DMA
6.73
Positive
Market Momentum
MACD
-0.28
Positive
RSI
29.14
Positive
STOCH
10.09
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:FTG, the sentiment is Negative. The current price of 6.94 is below the 20-day moving average (MA) of 7.56, below the 50-day MA of 7.72, and above the 200-day MA of 6.73, indicating a neutral trend. The MACD of -0.28 indicates Positive momentum. The RSI at 29.14 is Positive, neither overbought nor oversold. The STOCH value of 10.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:FTG.

Firan Tech Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TSMDA
79
Outperform
C$3.41B42.377.09%33.74%61.09%
TSFTG
65
Neutral
C$173.44M15.2116.43%18.03%-6.83%
61
Neutral
$8.22B13.010.73%3.10%3.88%-16.90%
TSATS
60
Neutral
C$3.83B43.025.30%-7.46%-49.87%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:FTG
Firan Tech
6.89
1.38
25.05%
CAE
CAE
24.35
4.35
21.75%
BB
BlackBerry
4.54
1.89
71.32%
DOOO
BRP
38.50
-22.09
-36.46%
TSE:ATS
ATS Corporation
39.11
-9.88
-20.17%
TSE:MDA
MDA Ltd
27.93
13.91
99.22%

Firan Tech Earnings Call Summary

Earnings Call Date: Feb 19, 2025 | % Change Since: -18.26% | Next Earnings Date: Apr 9, 2025
Earnings Call Sentiment Positive
The earnings call highlighted FTG's strong financial performance in 2024, with record revenue and significant growth in adjusted EBITDA. Successful integration of acquisitions and key contract wins were notable achievements. However, challenges such as margin compression, a decrease in Boeing deliveries, potential tariff impacts, and work stoppages were also acknowledged. Despite these challenges, the company's strategic actions and market positioning are expected to drive future growth.
Highlights
Record-Breaking Revenue and Growth
FTG achieved a record year with Q4 revenues totaling $45 million and full-year sales exceeding $162 million, marking a 20% increase over 2023. Total bookings reached $184.5 million, a 25% increase, and the year-end backlog rose by 26%.
Significant Increase in Adjusted EBITDA
Adjusted EBITDA increased by 33% to $25.8 million from $19.4 million in 2023, driven by higher sales volumes and operational improvements.
Notable Contract Win
FTG secured a $17 million contract to supply cockpit interface assemblies for COMAC's C919 aircraft, with production spanning from late 2024 through 2026.
Successful Integration of Acquisitions
The 2023 acquisitions showed improvements in throughput, pricing, and cost savings, with Circuits Minnetonka achieving a 16% revenue growth.
Strong Performance in Aerospace and Circuits Segments
Sales in the Aerospace business increased by 3% and the Circuits segment by 28% year-over-year, with strong contributions from acquisitions and organic growth.
Lowlights
Margin Compression
FTG's gross margin for 2024 was 27.3%, down from 29.1% in 2023, though improved operational efficiencies and foreign exchange rates partially offset this.
Challenges in Boeing Deliveries
Boeing shipped under 350 planes in 2024, down from about 500 in 2023, due in part to a safety incident and a machinists strike.
Potential Impact of US Tariffs
The new US administration's commitment to implementing tariffs could negatively impact FTG, with around $55 million of sales to US customers originating from sites in Canada or China.
Work Stoppage Impact
A 6-week work stoppage at the Aerospace-Toronto facility early in the year negatively impacted results, although later recovery offset some of these effects.
Company Guidance
During the FTG Fourth Quarter 2024 Analyst Call, Brad Bourne, President and CEO, highlighted the company's strong financial performance, with Q4 revenues reaching $45.2 million, contributing to a record year-end sales total of $162.1 million, a 20% increase over the previous year. Key metrics included a 25% rise in total bookings to $184.5 million, a 26% increase in year-end backlog to $122.4 million, and adjusted EBITDA growth of 33%, reaching $25.8 million. Adjusted net earnings soared by 47% to $10.3 million. The company's balance sheet remained robust, ending the year with net debt of $0.7 million after significant investments. FTG's strategic focus on acquisitions, such as the integration of Circuits Minnetonka and Circuits Haverhill, alongside securing a $17 million contract for COMAC's C919 aircraft, were pivotal in driving growth. The aerospace market dynamics, with Airbus and Boeing's production plans, alongside the company's strategic initiatives, including a new facility in India and the acquisition of FLYHT, underpin FTG's long-term growth trajectory.

Firan Tech Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
FTG Reports Strong 2024 Financial Results and Strategic Enhancements
Positive
Feb 19, 2025

FTG announced significant financial growth for the full year and fourth quarter of 2024, with a 25% increase in bookings and a 20% rise in revenue. The company maintained a strong balance sheet and achieved strategic milestones, including successful integration of acquisitions and securing key contracts. Subsequent to year-end, FTG further enhanced its market position through the acquisition of FLYHT Aerospace Solutions Ltd., expanding its aerospace aftermarket presence and product offerings, and announced plans to open a new facility in India to support growth.

Business Operations and StrategyFinancial Disclosures
Firan Technology Group Reports Strong Financial Growth in 2024
Positive
Feb 19, 2025

Firan Technology Group Corporation reported significant financial growth in 2024, with a 25% increase in total bookings, a 20% rise in revenue to $162.1 million, and a 47% increase in adjusted net earnings. The company maintained a robust balance sheet and invested in existing sites to promote organic growth. FTG’s strategic capital deployment aims to enhance shareholder returns and improve its market position, reflecting a strong operational outlook.

Financial Disclosures
Firan Technology Group to Release 2024 Financial Results
Neutral
Feb 12, 2025

Firan Technology Group Corporation is set to announce its full year and fourth quarter 2024 financial results on February 19, 2025. The announcement will be followed by a live conference call hosted by the President and CEO, Brad Bourne, to discuss the financial outcomes. This financial disclosure is crucial for investors and stakeholders as it provides insights into the company’s financial health and operational performance, potentially affecting its market positioning in the aerospace and defense sectors.

Business Operations and Strategy
FTG Expands Aerospace Operations with New Facility in India
Positive
Feb 11, 2025

Firan Technology Group Corporation (FTG) has announced the launch of a new aerospace facility in Hyderabad, India, which will begin production by the end of 2025. This strategic expansion is part of FTG’s ongoing efforts to increase its global footprint, particularly in the growing Indian aerospace and defense market, supported by India’s ‘Make in India’ initiative. The facility will focus on manufacturing cockpit products and will serve both local and international clients from a location within a Special Economic Zone, facilitating tariff-free trade. The new Hyderabad site marks FTG’s fourth country for aerospace manufacturing and underscores its commitment to delivering high-quality solutions in the aviation and defense sectors, emphasizing Human Machine Interface (HMI) devices.

Private Placements and FinancingBusiness Operations and Strategy
FTG Corporation Secures New Banking Agreement to Boost Growth
Positive
Jan 29, 2025

FTG Corporation has finalized a new 3-year banking agreement with BMO Corporate Finance, securing $10 million each in revolving operating and term credit facilities, along with a $15 million accordion facility for acquisitions. This agreement is designed to enhance FTG’s operational flexibility and reduce costs, supporting its growth and corporate development objectives, which may strengthen its market position in the aerospace and defense sectors.

Product-Related AnnouncementsBusiness Operations and Strategy
FTG Wins Contract to Supply Cockpit Assemblies for De Havilland’s Firefighting Aircraft
Positive
Jan 22, 2025

FTG Corporation has been selected by De Havilland Aircraft of Canada Ltd. to supply cockpit control assemblies for the new Canadair 515 firefighting aircraft, marking a significant achievement for the company. This contract highlights FTG’s capacity to deliver high-quality Canadian-made components, reinforcing its position in the aerospace industry and supporting the growth of aerial firefighting operations with its sophisticated cockpit panel assemblies.

FTG Gains CAAC Approval for Maintenance Operations in China
Jan 7, 2025

FTG has received approval from the Civil Aviation Administration of China to operate as an Approved Maintenance Organization (AMO) through its FTG Aerospace Tianjin unit. This approval allows FTG to maintain and repair aeronautical instruments and display devices, enhancing its capability to support customers throughout their product lifecycle, particularly on the C919 aircraft in China. This certification is a strategic milestone for FTG as it seeks to expand its presence in the large aftermarket segment of the aerospace industry, potentially strengthening its market position and offering new opportunities for growth.

Firan Tech Completes Acquisition of FLYHT Aerospace
Dec 20, 2024

Firan Technology Group Corporation has successfully completed its acquisition of FLYHT Aerospace Solutions, making FLYHT a wholly-owned subsidiary. The acquisition aims to strengthen FTG’s presence in the commercial aerospace aftermarket and expand its SATCOM product offerings. FLYHT shares will be delisted from the TSX Venture Exchange as a result.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.