And Another Stifel’s Justin Keywood increased his ATS Corp. target to $75 from $66, keeping a “buy” rating. The average is $57.57.
“ATS has secured US$458-million (C$624-million) of new EV bookings within the past three quarters, related to battery pack automation, including a US$81-million (C$111-million) win announced last week,” he said. “The wins help provide visibility to solid results through 2024, including organic growth and supplementing already tailwinds for an automation business that is mostly in resilient segments at 80 per cent of sales. We also see prospects for ATS to resume M&A after a bit of a pause in 2022, where there is a strong track record with ROIC almost doubling since 2018. The prospects of a U.S. stock listing could also help widen the investor base and bridge the gap in valuation, where ATS is trading at only 11.5 times C2023 EBITDA, 30 per cent below peers. ATS’ share price has appreciated 250 per cent since the current CEO started in March 2017, but we continue to see additional upside, and ATS remains our top pick.”