CAMBRIDGE, Ontario - ATS Corporation (TSX: ATS) (NYSE: ATS), a global provider of automation solutions, has completed its acquisition of Paxiom Group, a company known for its packaging machines utilized in various industries including food and beverage, cannabis, and pharmaceuticals. The definitive agreement for this acquisition was initially announced on May 15, 2024.
ATS Corporation, established in 1978, operates across multiple sectors such as life sciences, transportation, and energy, offering a wide range of automation services. With this recent acquisition, ATS aims to enhance its service offerings in the packaging automation sector, leveraging Paxiom's expertise in primary, secondary, and end-of-line packaging solutions.
The acquisition is expected to complement ATS's existing capabilities in custom and repeat automation, as well as automation products and services. ATS currently employs over 7,000 individuals and has a presence in North America, Europe, Southeast Asia, and Oceania through more than 65 manufacturing facilities and over 85 offices.
The financial terms of the acquisition were not disclosed in the press release. ATS Corporation's shares are publicly traded on both the Toronto Stock Exchange and the New York Stock Exchange under the symbol "ATS."
This strategic move could potentially broaden ATS's customer base and strengthen its position in the automation industry by integrating Paxiom's specialized packaging technologies. The completion of this transaction marks a significant milestone for ATS as it continues to expand its global footprint and service offerings.
The information in this article is based on a press release statement from ATS Corporation.
In other recent news, ATS Corporation has reported its fourth quarter and annual results, revealing record revenues of $792 million, an 8% increase from the previous year. The company's adjusted earnings for Q4 were $96 million, with earnings per share (EPS) rising 53% to $0.49. Despite a decrease in adjusted earnings from operations and gross margins, ATS has shown strategic growth through four acquisitions in fiscal year 2024 and robust order bookings. However, the company faced a $150 million delay in transportation orders due to an EV customer.
In terms of future expectations, ATS anticipates flat sales in 2025, with growth in markets excluding EV expected to balance the decline. The company aims to achieve a 15% adjusted EBIT margin, maintaining this goal despite current margin headwinds. ATS is confident in margin improvement and creating value for customers and shareholders in the upcoming fiscal year.
These recent developments underscore ATS's strategy of driving expansion in high-value markets, despite setbacks in the EV sector. The company's diverse portfolio and strategic acquisitions position it well to navigate the challenges ahead.
InvestingPro Insights
As ATS Corporation (TSX: ATS) (NYSE: ATS) announces the completion of its acquisition of Paxiom Group, the company's financial metrics and analyst insights suggest a strategic positioning that could influence investor confidence. With a market capitalization of $3.09 billion USD and a P/E ratio standing at 22.29, ATS is trading at a valuation that reflects its current earnings. Notably, when adjusted for the last twelve months as of Q4 2024, the P/E ratio becomes even more attractive at 19.37, indicating a potentially undervalued stock relative to its near-term earnings growth.
Analysts have taken note of ATS's financial stability, as evidenced by the fact that the company's liquid assets exceed its short-term obligations. This is a reassuring sign for investors looking for companies with solid balance sheets. Moreover, the company's shares are trading near their 52-week low, which could represent a buying opportunity for value investors.
With the company's revenue showing a healthy growth of 17.67% over the last twelve months as of Q4 2024, and an operating income margin of 11.47%, ATS appears to be efficiently converting its top-line growth into profitable returns. Additionally, the InvestingPro Tips highlight that analysts predict the company will be profitable this year and that it has been profitable over the last twelve months, reinforcing the positive outlook on its financial health.
For readers interested in gaining deeper analytical insights and additional InvestingPro Tips, they can explore more on https://www.investing.com/pro/ATS. There are currently 5 additional tips available, which could further inform investment decisions. To access these insights, readers can use the promo code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
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