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Rb Global (TSE:RBA)
:RBA
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Ritchie Bros Auction
(NYSE:RBA)74Outperform
Positive Factors
Financial Performance
Q4/24 results included a revenue increase of 10% to $1.1 billion with a 13% increase in adjusted EBITDA to $346 million on a 2% increase in GTV to $4.1 billion.
Strategic Expansion
Ritchie Bros. is viewed as one of the top industrial picks in 2025 with potential market share gains in its auto salvage business.
Negative Factors
Market Conditions
Consignors continue to be hesitant to bring used equipment to auction preferring to take a wait and see attitude due to uncertainty in select segments of the economy and potential tariffs.
Ritchie Bros Auction (RBA) vs. S&P 500 (SPY)
Market Cap
C$26.92B
Dividend Yield1.1%
Average Volume (3M)243.49K
Price to Earnings (P/E)52.9
Beta (1Y)0.96
Revenue Growth18.26%
EPS Growth141.71%
CountryCA
Employees7,900
SectorServices
Sector StrengthN/A
IndustryCorporate Services
Share Statistics
EPS (TTM)2.76
Shares Outstanding184,748,860
10 Day Avg. Volume389,521
30 Day Avg. Volume243,492
Financial Highlights & Ratios
PEG Ratio0.37
Price to Book (P/B)N/A
Price to Sales (P/S)4.59
Price to Cash Flow (P/CF)16.80
P/FCF Ratio18.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$163.02Price Target Upside9.41% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering9
Ritchie Bros Auction Business Overview & Revenue Model
Company DescriptionRitchie Bros. Auctioneers (RBA) is a global leader in asset management and disposition, specializing in industrial equipment auctions. The company operates in sectors such as construction, transportation, agriculture, energy, and mining, providing a platform for buying and selling used heavy equipment and trucks. Ritchie Bros. offers live unreserved auctions, online marketplaces, and a range of value-added services to facilitate the disposition and acquisition of assets.
How the Company Makes MoneyRitchie Bros. generates revenue through commissions earned on the sale of equipment in its auctions and online marketplaces. The company conducts live auctions with both on-site and online bidding, as well as operates an online-only auction platform known as IronPlanet. Ritchie Bros. also offers ancillary services such as equipment financing, appraisals, inspections, refurbishing, and logistics, providing additional revenue streams. Key partnerships with equipment manufacturers, brokers, and dealers further support their business model, enhancing their ability to attract a wide array of sellers and buyers, which bolsters auction attendance and increases transaction volume.
Ritchie Bros Auction Financial Statement Overview
Summary
Ritchie Bros exhibits robust financial health with strong revenue growth, efficient cost management, and solid cash flow generation. The balance sheet remains stable with reasonable leverage and effective equity utilization.Income Statement
Ritchie Bros demonstrated strong revenue growth with a significant increase of 16.4% from the previous year. Gross profit margin is healthy at 46.8%, and net profit margin improved to 9.6%. The EBIT and EBITDA margins also showed improvement, indicating effective cost management and operational efficiency.85
Very Positive
Balance Sheet
The balance sheet shows a stable financial position with a debt-to-equity ratio of 0.75, indicating reasonable leverage. The return on equity is robust at 7.2%, reflecting efficient use of equity to generate profits. The equity ratio stands at 48.3%, highlighting a strong equity base relative to total assets.78
Positive
Cash Flow
Cash flow analysis reveals a remarkable free cash flow growth rate of 231.1%, supported by strong operating cash flow. The operating cash flow to net income ratio of 2.26 signals efficient cash generation relative to profits. The free cash flow to net income ratio is 1.59, indicating sound cash management.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 4.28B | 3.68B | 1.73B | 1.42B | 1.38B | Gross Profit |
| 2.00B | 1.78B | 957.11M | 822.19M | 761.67M | EBIT |
| 761.20M | 471.30M | 328.08M | 240.15M | 263.16M | EBITDA |
| 1.38B | 958.30M | 444.61M | 343.00M | 358.62M | Net Income Common Stockholders |
| 413.10M | 206.50M | 319.70M | 119.14M | 170.09M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 533.90M | 576.20M | 494.32M | 326.11M | 278.77M | Total Assets |
| 11.81B | 12.04B | 2.86B | 3.59B | 2.35B | Total Debt |
| 4.29B | 4.64B | 610.62M | 1.74B | 665.79M | Net Debt |
| 3.75B | 4.06B | 116.29M | 1.42B | 387.03M | Total Liabilities |
| 6.09B | 6.53B | 1.57B | 2.52B | 1.34B | Stockholders Equity |
| 5.71B | 5.50B | 1.29B | 1.07B | 1.01B |
| Cash Flow | Free Cash Flow | |||
| 655.10M | 197.80M | 391.12M | 274.10M | 214.74M | Operating Cash Flow |
| 932.00M | 544.00M | 463.06M | 317.59M | 257.87M | Investing Cash Flow |
| -301.60M | -3.11B | 77.33M | -214.07M | -276.72M | Financing Cash Flow |
| -645.50M | 2.68B | -1.26B | 960.91M | -111.46M |
Ritchie Bros Auction Technical Analysis
Positive
149.00
Price Trends
133.51
Positive
129.88
Positive
118.90
Positive
Market Momentum
4.38
Negative
63.58
Neutral
57.30
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RBA, the sentiment is Positive. The current price of 149 is above the 20-day moving average (MA) of 139.54, above the 50-day MA of 133.51, and above the 200-day MA of 118.90, indicating a bullish trend. The MACD of 4.38 indicates Negative momentum. The RSI at 63.58 is Neutral, neither overbought nor oversold. The STOCH value of 57.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:RBA.
Ritchie Bros Auction Risk Analysis
Ritchie Bros Auction disclosed 56 risk factors in its most recent earnings report. Ritchie Bros Auction reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Ritchie Bros Auction Peers Comparison
Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | C$26.92B | 52.86 | 7.24% | 1.10% | 18.26% | 141.71% | |
66 Neutral | C$1.15B | 10.30 | 11.04% | 5.91% | -0.27% | -15.99% | |
63 Neutral | C$6.20B | 25.73 | 7.65% | 4.00% | -12.83% | -46.54% | |
55 Neutral | C$403.51M | ― | -10.14% | ― | -3.27% | -160.21% | |
50 Neutral | $2.31B | 7.03 | -7.82% | 0.22% | 2.84% | -16600.00% |
* Services Sector Average
Performance Comparison
TSE:RBA
Ritchie Bros Auction
145.70
45.69
45.69%
TSE:PKI
Parkland
35.10
-6.42
-15.46%
TSE:MTL
Mullen Group Ltd.
12.96
-1.40
-9.75%
TSE:ACQ
AutoCanada
15.55
-4.92
-24.04%
Ritchie Bros Auction Earnings Call Summary
Earnings Call Date: Feb 18, 2025 | % Change Since: 8.81% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with strong financial discipline and growth in certain areas like automotive and service revenue, but faced challenges in the CC&T sector and macroeconomic uncertainty. The strategic focus on operational efficiency and investment in new markets like Australia is promising, but the impacts of external factors such as the Yellow Corporation bankruptcy and potential tariffs create some headwinds.Highlights
Adjusted EBITDA Growth
Fourth quarter adjusted EBITDA increased by 13% on a 2% increase in gross transactional value, showcasing strong financial discipline and operational efficiency.
Automotive Sector Performance
Automotive GTV increased by 4%, driven by a 7% increase in unit volumes, despite a decline in the average price per vehicle sold.
Service Revenue Increase
Service revenue increased by 8% due to a higher service revenue take rate and higher GTV, with the service take rate increasing approximately 110 basis points year-over-year to 21.3%.
Debt Reduction
Solid operational performance and continued debt paydown led to a decline in adjusted net debt to trailing 12 months adjusted EBITDA to approximately 1.6x.
Expansion in Australia
Investment in Australia for Greenfield expansion, with expectations for more wins in the region to drive ROI.
Lowlights
CC&T Sector Challenges
GTV in the commercial construction and transportation sector decreased by 1% driven by a decline in the average price per lot sold, partially offset by an 18% increase in lot volumes.
Impact of Yellow Corporation Bankruptcy
Excluding the impact of the Yellow Corporation bankruptcy, the GTV decline in the commercial construction and transportation sector would have been approximately 2%.
Macroeconomic Uncertainty
Continued uncertainty in 2025 with a 'wait and see' environment described in the commercial construction and transportation sectors.
Automotive Price Decline
Average selling prices of salvage U.S. insurance vehicles declined less than 1%, and when excluding the impacts from CAT, declined approximately 2% year-over-year.
Company Guidance
In the RB Global Fourth Quarter 2024 earnings call, the company reported a 13% increase in adjusted EBITDA and a 2% increase in gross transactional value (GTV) for the quarter. The automotive sector saw a 4% increase in GTV, driven by a 7% rise in unit volumes despite a decline in average price per vehicle. The commercial construction and transportation (CC&T) sector experienced a 1% decrease in GTV, influenced by a drop in the average price per lot sold, offset by an 18% rise in lot volumes. Service revenue rose by 8%, with the service take rate increasing by approximately 110 basis points to 21.3%. Adjusted EBITDA as a percentage of GTV improved to 8.4% from 7.7% the previous year. For 2025, RB Global projects full-year GTV growth between 0% and 3% and adjusted EBITDA growth between 1% and 6%, with anticipated capital expenditures ranging from $350 million to $400 million. The company's strategy focuses on premium price performance, expanding its enterprise partner base, and driving growth with regional customers.Ritchie Bros Auction Corporate Events
Business Operations and StrategyFinancial Disclosures
RB Global Reports Strong 2024 Financial Results, Sets Positive Outlook for 2025
Positive
Feb 18, 2025
RB Global reported positive fourth-quarter and full-year 2024 financial results, with total revenue increasing by 10% and net income rising by 41% year over year. The company emphasized its strategic focus on enhancing operational efficiency and reducing leverage, setting a foundation for continued growth in 2025.
Dividends
RB Global Adjusts Record Date for Quarterly Dividend
Neutral
Feb 4, 2025
RB Global, Inc. has changed the record date for its quarterly cash dividend from February 6, 2025, to February 14, 2025, while keeping the payment date unchanged at March 3, 2025. This amendment in the dividend record date is significant for stakeholders as it affects eligibility for the dividend, potentially impacting investment strategies and tax considerations for shareholders.
Dividends
RB Global Declares Quarterly Dividend, Reinforcing Market Strength
Positive
Jan 20, 2025
RB Global, Inc. announced a quarterly cash dividend of $0.29 per common share, payable on March 3, 2025, to shareholders of record as of February 6, 2025. This decision reflects the company’s ongoing commitment to delivering shareholder value and maintaining its strong market position in the commercial asset and vehicle auction industry.
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.