Q: I'm wondering whether you think ATS is a good investment now seeing its price has come down?
Thank you
Thank you
5i Research Answer:
We like ATS as a long-term hold, and while its recent price action has been negative, its negative momentum has slowed in recent days and its earnings are expected in the next few weeks. ATS has demonstrated a five-year sales and earnings CAGR of 19% and 21%, respectively, and analysts expect decent forward growth estimates. It is a somewhat small name ($4.8B market cap), but it is well-managed, has decent debt levels, a good valuation of 17.6X forward earnings, growing margins, and a strong balance sheet. For an investor with a long-term time horizon, we would be comfortable owning ATS here, acknowledging its smaller size risks.