Westaim (WED) AI Stock Analysis

• Market Cap: C$660.72M
• Dividend Yield: N/A
• Average Volume (3M): 19.93K
• Price to Earnings (P/E): 12.6
• Beta (1Y): 0.13
• Revenue Growth: 77.04%
• EPS Growth: -76.52%
• Country: CA
• Employees: 8
• Sector: Financial
• Sector Strength: 77
• Industry: Asset Management Services
• EPS (TTM): 2.45
• Shares Outstanding: 21,361,813
• 10 Day Avg. Volume: 15,669
• 30 Day Avg. Volume: 19,932
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 5.04
• Price to Cash Flow (P/CF): -8.00
• P/FCF Ratio: 0.00
• 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: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Westaim's strong financial position, with no debt and high profitability, is its primary strength. However, concerns about declining revenue and negative cash flows impact its operational outlook. Technical indicators suggest a lack of strong market momentum, and moderate valuation further tempers the stock's appeal. Focus on improving revenue and liquidity is crucial for future performance.

Westaim Business Overview & Revenue Model

Company Description

Westaim Corp is a Canada-based investment company, engaged in providing long-term capital to businesses operating primarily within the global financial services industry. It invests, directly and indirectly, through acquisitions, joint ventures, and other arrangements, with the objective of providing its shareholders with capital appreciation and real wealth preservation. The group seeks to acquire debt, equity, or derivative securities of both public and private companies. The company derives revenue mostly from interest income and dividend income. Geographically, the company has a business presence in the US, Asia Pacific, Canada, Europe and other countries.

How the Company Makes Money

Westaim makes money primarily through its investments in financial services companies. The company earns revenue from the appreciation of its investment portfolio, dividends, and interest income generated by its holdings. Additionally, Westaim may also realize gains from the sale of investments. The company’s strategic partnerships and management expertise contribute to optimizing the performance and value of its portfolio companies, further enhancing its revenue streams.

Westaim Financial Statement Overview

Summary

Westaim shows strong profitability and a solid balance sheet with no debt, which is a significant strength. However, revenue decline and negative cash flows in TTM raise concerns about operational efficiency and liquidity. Continued focus on revenue growth and cash flow improvement is necessary.

Income Statement

Westaim displays strong profitability with a high gross profit margin of approximately 99.87% in TTM. The net profit margin is also strong at about 44.28%. However, revenue has decreased significantly from 2023 to TTM, indicating a challenge in revenue generation.

Balance Sheet

The company maintains a solid financial position with no debt, resulting in a favorable debt-to-equity ratio of 0. Return on Equity is robust at 7.85% for TTM, and the equity ratio is very high at 94.46%, indicating financial stability and low leverage.

Cash Flow

Westaim's cash flow position shows some concerns, with negative operating and free cash flows in TTM. The free cash flow to net income ratio is negative, highlighting potential liquidity issues. However, substantial positive investing cash flow suggests effective capital management.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
90.61M	211.27M	25.67M	31.70M	-27.47M	16.87M
	Gross Profit
90.49M	209.76M	25.67M	31.70M	-27.47M	16.87M
	EBIT
43.18M	187.79M	19.50M	28.43M	-34.28M	9.46M
	EBITDA
43.20M	187.80M	19.38M	26.36M	-32.00M	12.26M
	Net Income Common Stockholders
40.12M	183.98M	17.96M	28.21M	-34.40M	8.52M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
7.84M	521.76M	3.43M	6.56M	8.74M	22.24M
	Total Assets
397.40M	551.82M	413.29M	401.66M	377.35M	410.75M
	Total Debt
36.65M	128.00K	261.00K	413.00K	541.00K	645.00K
	Net Debt
28.81M	-135.03M	-3.17M	-6.14M	-8.20M	-21.59M
	Total Liabilities
52.22M	33.48M	50.22M	53.98M	56.83M	56.08M
	Stockholders Equity
345.18M	518.35M	363.07M	347.68M	320.52M	354.67M
Cash Flow		Free Cash Flow
-31.60M	-3.09M	-2.46M	-5.13M	18.51M	1.34M
	Operating Cash Flow
-31.59M	-3.09M	-2.46M	-5.12M	18.54M	1.34M
	Investing Cash Flow
363.83M	6.67M	1.90M	3.99M	-32.04M	13.06M
	Financing Cash Flow
-19.77M	-64.20M	-2.56M	-1.05M	0.00	0.00

Westaim Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 30.93
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:WED, the sentiment is Neutral. The current price of 30.93 is below the 20-day moving average (MA) of 32.23, above the 50-day MA of 30.91, and above the 200-day MA of 27.34, indicating a neutral trend. The MACD of 0.05 indicates Positive momentum. The RSI at 44.36 is Neutral, neither overbought nor oversold. The STOCH value of 21.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:WED.

Westaim Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GCG	70 Outperform	C$1.00B	9.42	7.82%	3.65%	36.20%	―
EIF	69 Neutral	C$2.50B	19.88	9.13%	5.27%	6.46%	-5.54%
WED	67 Neutral	C$660.72M	12.60	7.97%	―	77.04%	-76.52%
Sector *	64 Neutral	$13.80B	10.64	9.23%	4.22%	17.66%	-7.66%
FSZ	59 Neutral	C$650.38M	26.22	8.22%	14.07%	5.64%	-57.76%
ONEX	57 Neutral	C$7.03B	18.53	3.54%	0.40%	-17.78%	-41.13%
BAM	54 Neutral	C$110.86B	46.67	16.87%	3.24%	―	―

Westaim Corporate Events

Westaim Appoints Menes Chee as Independent Director Amid Strategic Transformation

The Westaim Corporation announced the appointment of Menes O. Chee as an independent director on its Board, contingent upon the closing of its transaction with CC Capital. This move is expected to bolster Westaim’s strategic transformation into an integrated insurance and asset management platform. Chee’s extensive experience in corporate finance and private equity is anticipated to enhance the Board’s capabilities, aligning with Westaim’s objectives to drive long-term shareholder value in the financial services industry.

Westaim Restructures and Relocates to Delaware

Westaim Corporation has completed a significant restructuring, consolidating its common shares and relocating its incorporation from Alberta, Canada, to Delaware, USA. The changes, approved by a vast majority of shareholders, aim to enhance shareholder value and are set to impact the company’s trading on the TSX Venture Exchange.

Westaim Shareholders Approve Major CC Capital Deal

Westaim Corporation shareholders have overwhelmingly approved a significant transaction with CC Capital Partners, which includes a share consolidation and strategic investment. The move involves redomiciling the company to Delaware and restructuring its Arena Investors Group Holdings, aiming to enhance shareholder value.

Westaim Urges Shareholders to Vote Amid Postal Disruptions

Westaim Corporation is urging shareholders to vote on important matters related to a transaction with CC Capital Partners before a special meeting on December 19, 2024. The company highlights the need for shareholders to use electronic voting methods due to postal disruptions in Canada. Shareholders can access voting materials online and seek assistance from Kingsdale Advisors if needed.

Westaim Names New CFO Amid Strategic Expansion

Westaim Corporation has announced the appointment of Matthew Skurbe as their new Chief Financial Officer and Chief Risk Officer, following the company’s strategic partnership with CC Capital. Skurbe brings a wealth of experience from his previous roles at CC Capital and Blackstone, promising to drive growth and value for Westaim’s shareholders. This move is part of Westaim’s strategy to create a robust integrated insurance and asset management platform.

Westaim Announces Key Shareholder Meeting Amid Postal Delays

Westaim Corporation has announced the filing of its management information circular for an upcoming special shareholders meeting, where crucial resolutions, including a major investment and share consolidation, will be discussed. Due to potential Canada Post delays, shareholders are urged to access meeting materials online. The meeting will address significant corporate changes, including a $250 million investment and a shift in the company’s jurisdiction.

Westaim Reports Q3 Loss and Announces New Investments

Westaim Corporation reported a net loss of $1.1 million for Q3 2024, a sharp decline from the previous year’s profit of $23 million for the same period. The company also announced a $250 million strategic investment agreement with Wembley Group Partners and plans to invest $600 million in a new vehicle managed by CC Capital.