Value
7.4/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 2.3 |
| P/S | 9.7 |
| EV/EBITDA | 4.5 |
| Fwd P/E | 7.3 |
| PEG | 10.0 |
- ▸Forward P/E: 17.1x
- ▸PEG: 0.08
- ▸Attractively valued
ATS · Why this verdict
Why ATS (ATS) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company ranks among the top performers in its peer group on growth metrics, with revenue expanding at roughly 30% year over year — a rate that the current forward multiple of 17.3x and near-zero PEG ratio appear to significantly undervalue. Peer rank | Revenue growth stays above 20% year over year for at least 2 consecutive quarters. | →Stable |
| CounterElevated growth scores can reflect acquisitions or non-recurring tailwinds rather than organic demand; the below-average quality score suggests the earnings delivered alongside this growth have been inconsistent. | ||
The company converts reported earnings into free cash flow at roughly 494% — generating nearly five times its net income in actual cash, a rare marker of working capital discipline and capital efficiency. Quality breakdown | The free cash flow to net income ratio stays above 200% for 4 consecutive quarters, confirming that cash generation is structurally durable rather than timing-related. | →Stable |
| CounterA free cash flow to net income ratio well above 100% is unusual and may reflect accelerating collections from deferred revenue, asset disposals, or other one-time items rather than sustainable operating cash generation — the below-average quality score is consistent with this caution. | ||
Two of the last four quarters were misses, including the most recent, where actual earnings fell roughly 19% below consensus — a pattern that undermines confidence in guidance reliability and creates a headwind for multiple expansion. Earnings | The next 2 reported quarters each beat consensus by at least 5%, confirming that execution has improved. | →Stable |
| CounterThe two prior quarters were both beats, and the oldest quarter was also a miss, suggesting the pattern may reflect lumpy revenue recognition rather than a structural deterioration in earnings power. | ||
A momentum score of 3.7 — below the 4.5 threshold — an RSI at 27, and a position below the 200-day moving average create a technical headwind, though the moving average itself is still rising at a positive slope, suggesting this may be a pullback within a longer uptrend rather than a confirmed trend reversal. Momentum breakdown | RSI recovers above 40 and price reclaims the 200-day moving average within 2 quarters. | →Stable |
| CounterAn RSI at 27 is approaching oversold territory and volume accumulation continues — the same technical setup that warns of weakness also signals that sellers may be nearing exhaustion. | ||
A forward P/E of 17.3x paired with a near-zero PEG ratio indicates the market is pricing this growth business at a steep discount to its expansion trajectory — a gap that can close quickly if earnings delivery improves. Valuation breakdown | The forward multiple expands above 22x as analysts gain confidence in the earnings trajectory. | →Stable |
| CounterDiscounted multiples can reflect rational skepticism about earnings quality; until the company delivers two or more consecutive beats, the market may justifiably keep the multiple suppressed. | ||
The company ranks among the top performers in its peer group on growth metrics, with revenue expanding at roughly 30% year over year — a rate that the current forward multiple of 17.3x and near-zero PEG ratio appear to significantly undervalue.
→StablePeer rank
- Expectation
- Revenue growth stays above 20% year over year for at least 2 consecutive quarters.
CounterElevated growth scores can reflect acquisitions or non-recurring tailwinds rather than organic demand; the below-average quality score suggests the earnings delivered alongside this growth have been inconsistent.
The company converts reported earnings into free cash flow at roughly 494% — generating nearly five times its net income in actual cash, a rare marker of working capital discipline and capital efficiency.
→StableQuality breakdown
- Expectation
- The free cash flow to net income ratio stays above 200% for 4 consecutive quarters, confirming that cash generation is structurally durable rather than timing-related.
CounterA free cash flow to net income ratio well above 100% is unusual and may reflect accelerating collections from deferred revenue, asset disposals, or other one-time items rather than sustainable operating cash generation — the below-average quality score is consistent with this caution.
Two of the last four quarters were misses, including the most recent, where actual earnings fell roughly 19% below consensus — a pattern that undermines confidence in guidance reliability and creates a headwind for multiple expansion.
→StableEarnings
- Expectation
- The next 2 reported quarters each beat consensus by at least 5%, confirming that execution has improved.
CounterThe two prior quarters were both beats, and the oldest quarter was also a miss, suggesting the pattern may reflect lumpy revenue recognition rather than a structural deterioration in earnings power.
A momentum score of 3.7 — below the 4.5 threshold — an RSI at 27, and a position below the 200-day moving average create a technical headwind, though the moving average itself is still rising at a positive slope, suggesting this may be a pullback within a longer uptrend rather than a confirmed trend reversal.
→StableMomentum breakdown
- Expectation
- RSI recovers above 40 and price reclaims the 200-day moving average within 2 quarters.
CounterAn RSI at 27 is approaching oversold territory and volume accumulation continues — the same technical setup that warns of weakness also signals that sellers may be nearing exhaustion.
A forward P/E of 17.3x paired with a near-zero PEG ratio indicates the market is pricing this growth business at a steep discount to its expansion trajectory — a gap that can close quickly if earnings delivery improves.
→StableValuation breakdown
- Expectation
- The forward multiple expands above 22x as analysts gain confidence in the earnings trajectory.
CounterDiscounted multiples can reflect rational skepticism about earnings quality; until the company delivers two or more consecutive beats, the market may justifiably keep the multiple suppressed.
TrendMatrix Research · core thesis
Engine thesis — one sentence
ATS Corporation's exceptional free cash flow conversion and industry-leading growth position it attractively on a valuation basis, but inconsistent earnings delivery and a failed momentum threshold create near-term uncertainty about whether the fundamental strength will translate into price appreciation.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.4 |
| ROA | 2.0 |
| Gross margin | 1.7 |
| Op margin | 1.2 |
| Net margin | 1.2 |
| Current ratio | 5.9 |
| FCF quality | 10.0 |
| Moat | 4.9 |
| Piotroski F | 7.8 |
- ▸Excellent cash conversion: 494% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 30% YoY
Momentum
4.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 9.9 |
| OBV | 1.0 |
| MA position | 2.2 |
| Volume | 3.1 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+0.6%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.5/10data confidence 67%| Component | Sub-score |
|---|---|
| Analyst rating | 7.5 |
| erm sentiment | 5.0 |
Insider
5.0/10data confidence 50%Peer rank
4.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.5 |
| quality rank | 1.8 |
| growth rank | 8.7 |
- ▸Industry growth leader
Technical
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.2 |
| support resistance | 5.2 |
| 52w position | 5.5 |
Risk (lower is worse)
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| days to cover | 0.2 |
| volatility | 4.0 |
| put call | 0.0 |
| implied vol | 3.0 |
| beta | 6.0 |
| debt equity | 6.1 |
- ▸Elevated put/call: 10.50
- ▸High IV: 62%
Catalyst
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 1.6 |
- ▸Earnings concerns: 2B/2M
How the verdict was assembled
Engine trigger
Mixed signals. Hold existing position. | News modifier -1 (HOLD_IF_HOLDING → SELL_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_HOLD_DEFAULT|L3:NEWS_MOD=-1Passed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:33d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- MOMENTUM:4.1<4.5
Warning (1)
- ASYMMETRY:UPSIDE_EXHAUSTED (upside=0.0%)
Reward-to-Risk
0.00
Upside
+0.0%
Downside
6.8%
Sizing output
AVOID
SetupRange Bound — RSI 56 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $2.7B<$5B
Investment implication
The default F-path HOLD fired without any positive-conviction gate triggering — no momentum acceleration, no quality+value crossover, no setup recognition. Highest-clear gate: INSIDER:OK. Top dim: Growth at 10.0; weakest: Risk (lower is worse) at 3.2. The engine's read is one of pattern absence — no directional conviction in either direction at current asymmetry.
The strongest dimensions are Growth at 10.0, Value at 7.4, and Sentiment at 6.5; the weakest are Risk (lower is worse) at 3.2, Catalyst at 3.7, and Peer rank at 4.0. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 0.00 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Industry Growth Leadership
Trip ifRevenue growth falls below 10% year over year for 2 consecutive quarters.
- P2Excellent Cash Conversion Quality
Trip ifFree cash flow to net income ratio falls below 100% for 2 consecutive quarters.
- P3Earnings Delivery Inconsistency
Trip ifEPS surprise exceeds 5% for 2 consecutive quarters.
- P4Momentum Gate Failure Oversold
Trip ifRSI recovers above 50 and price closes above the 200-day moving average for 3 consecutive weeks.
- P5Attractive Valuation Growth Discount
Trip ifForward EPS estimates are revised down by more than 20% over 2 consecutive quarters.