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Finning International (TSX:FTT) has drawn fresh investor attention after recent share price strength, with returns of 13.3% over the past month and 20.97% over the past 3 months. This has prompted a closer look at fundamentals.
See our latest analysis for Finning International.
At a share price of CA$89.53, Finning International’s recent 1 month share price return of 13.3% and strong 1 year total shareholder return of 107.67% suggest momentum has been building over both shorter and longer periods.
If this strength has you thinking about what else could benefit from heavy equipment and infrastructure trends, take a look at our 25 power grid technology and infrastructure stocks as a starting list of ideas.
With Finning International now at CA$89.53 and trading at a small discount to analyst targets but a premium to some intrinsic estimates, the key question is whether there is still a buying opportunity or whether markets are already pricing in future growth.
With Finning International at CA$89.53 versus a narrative fair value of CA$87.67, the most followed view sees the shares sitting slightly above its central estimate, built on detailed assumptions about margins, growth and valuation multiples.
Analysts have nudged their fair value estimate for Finning International higher to $87.67 from $85.56, reflecting updated assumptions for discount rate, revenue growth, profit margin and forward P/E, which are broadly in line with recent price target increases reported by Scotiabank and RBC Capital.
Curious what justifies paying close to this fair value range? The narrative leans heavily on specific margin improvements, revenue trends and a future earnings multiple that assumes solid execution without stretching expectations.
Result: Fair Value of CA$87.67 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts.
However, there are still watchpoints, including pressure from higher labor and inventory costs, as well as the risk that slower equipment utilization delays converting the current backlog into revenue.
