Finning International (FTT) — UK power-rental deal at a record high; ~27x trailing P/E

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The short version: record high, growth multiple

Finning International (TSX: FTT), the world’s largest Caterpillar dealer, closed at a record CA$112.30 on October 2, 2026, after a run of about 73% over twelve months and about 30% in the last month alone. The market is no longer pricing Finning like a plain mining-and-construction dealer. The new story is power: rental generators, backup power for data centres and industry, and a record equipment backlog.

That shift is real. But at about 27x trailing earnings and 22x forward, the question for a new buyer is simple: how much of the power story is already in the price? Below we go through the new deal, the backlog behind it, and how Finning compares with its closest TSX peers — Toromont, Russel Metals and Wajax — on size, returns, valuation, dividends and analyst targets.

What happened: the John F Hunt Power deal

On October 1, 2026, Finning acquired John F Hunt Power, one of the UK’s larger specialist generator rental companies. The deal brings:

• about 2,500 generator units,
• 6 depots and 145 employees, with a 24/7 nationwide service and a fuel-as-a-service offering,
• a business Finning expects to more than triple its power rental revenue in the UK and Ireland.

The purchase price wasn’t disclosed. Finning funded it from existing liquidity and said it won’t materially affect consolidated revenue, earnings or the balance sheet. So treat this as a strategic step, not an earnings jolt. It makes Finning a bigger player in UK temporary and backup power, a market where data-centre demand is strong even while UK construction is soft.

The Q2 print behind the rally

The deal builds on a strong second quarter, reported August 5, 2026:

• Revenue C$3.13B, up 20% — Finning’s first quarter above C$3 billion.
• Record EPS of C$1.22, up 21% from adjusted C$1.01 a year earlier.
• Product support (parts and service) up 11%, the ninth quarter in a row of year-over-year growth.
• Adjusted ROIC of 19.0%.
• A record equipment backlog of C$3.8B, up 22% since December 31. Power & energy was about a third of it, led by backup power demand including data centres; mining orders were also strong.

The weaker spots: free cash flow was only about C$15M in the quarter as working capital absorbed cash, and net debt sat at about 1.6x adjusted EBITDA. Both matter for the valuation discussion below.

Business overview: Finning vs distribution peers

Finning sells, rents and services Caterpillar equipment. Its biggest markets in the story above are copper mining in Chile, resource projects in Western Canada, the UK and Ireland, and Argentina, where government policy is a swing factor. The steady part of the business is product support — parts and service on a large installed fleet — which tends to hold up better than new equipment sales.

On the TSX screener, Finning sits in the Distribution services sector. The closest comparable is Toromont (TIH), the Caterpillar dealer for Eastern Canada. Russel Metals (RUS) is an industrial and metals distributor and Wajax (WJX) is an industrial equipment dealer. Smaller or non-comparable names in the sector were left out.

Overview table

Company (Ticker)	Price	Market cap	Revenue (LTM)	Net income (LTM)
Finning (FTT)	$112.30	$14.6B	$11.2B	$550M
Toromont (TIH)	$236.69	$19.3B	$5.56B	$515M
Russel Metals (RUS)	$95.21	$5.23B	$5.33B	$216M
Wajax (WJX)	$39.18	$849M	$2.06B	$66M
Average (incl. FTT)	—	$9.99B	$6.03B	$337M

Source: TSX screener (October 3, 2026, tsx-2026-10-03.csv) · CAD · LTM = last 12 months. Average includes FTT; blank cells skipped.

Finning is the revenue giant of the group, with about C$11.2B of sales over the last twelve months — double Toromont’s — and C$550M of net income. Yet Toromont is worth more (about C$19.3B vs C$14.6B), because it earns a higher margin (roughly 9% net vs about 5% for Finning) and the market pays up for that consistency.

Performance: a sector-wide rerating

Performance table

Company (Ticker)	1M	3M	6M	1Y	5Y	10Y
Finning (FTT)	+30.4%	+17.8%	+29.0%	+72.8%	+257%	+357%
Toromont (TIH)	+23.7%	+7.8%	+20.6%	+53.7%	+124%	+507%
Russel Metals (RUS)	+34.4%	+60.9%	+101%	+129%	+209%	+351%
Wajax (WJX)	+35.5%	+31.4%	+21.0%	+59.9%	+69.9%	+167%
Average (incl. FTT)	+31.0%	+29.5%	+42.8%	+78.8%	+165%	+345%

Source: TSX screener (October 3, 2026). Average includes FTT; blank cells skipped. Price change by window.

Over one month the whole group ran: Finning gained about 30%, Toromont about 24%, and Russel Metals and Wajax about 35% each. Over one year Russel Metals leads at about 129%, ahead of Finning’s 73%. The takeaway is that this is a sector-wide rerating, not just a Finning story — which means some of Finning’s gain is the tide, not the deal.

Over longer windows Finning is up about 257% in five years and 357% in ten, while Toromont has the best ten-year record at about 507%.

Valuation: fair on earnings, expensive on cash flow

Valuation table

Company (Ticker)	P/E	Fwd P/E	PEG	P/S	P/B	P/FCF	Price/Cash
Finning (FTT)	26.82	22.14	1.43	1.29	4.87	68.99	52.48
Toromont (TIH)	37.67	27.79	5.82	3.35	5.60	43.11	16.43
Russel Metals (RUS)	24.37	18.98	0.67	0.95	3.02	27.54	33.96
Wajax (WJX)	13.33	11.81	0.16	0.41	1.53	5.18	180
Average (incl. FTT)	25.55	20.18	2.02	1.50	3.76	36.21	70.77

Source: TSX screener (October 3, 2026). Average includes FTT; blank cells skipped. Highlighted = lowest (cheapest) positive value per column.

Finning trades near 27x trailing earnings and about 22x forward, close to the group average of about 26x trailing and well below Toromont’s ~38x. On price to sales Finning is about 1.3x, a little below the 1.5x average. Wajax is the cheapest name on almost every column, which reflects its small size and lower margins as much as any bargain.

The catch is free cash flow. At about 69x P/FCF, Finning screens far more expensive than the 36x group average, because working capital is soaking up cash as the backlog builds. If those orders turn into deliveries and cash over the next few quarters, the multiple should come down; if they don’t, the earnings multiple flatters the stock.

Dividend: well covered, but not an income pick

Dividends table

Company (Ticker)	Dividend / share	Yield	Payout ratio
Finning (FTT)	$1.18	1.16%	29.4%
Toromont (TIH)	$2.08	0.95%	34.2%
Russel Metals (RUS)	$1.72	1.85%	44.5%
Wajax (WJX)	$1.40	3.57%	46.5%
Average (incl. FTT)	$1.60	1.88%	38.6%

Source: TSX screener (October 3, 2026). Average includes FTT; blank cells skipped. Yield = indicated.

Finning pays about C$1.18 a year on the screener (trailing fiscal year; the current quarterly rate of C$0.325 annualizes to about C$1.30), for an indicated yield near 1.2% and a payout of about 29% of earnings. That is the lowest payout in the group, so the dividend is well covered. Toromont yields under 1%, Russel Metals about 1.9% and Wajax about 3.6%. At this price Finning is a growth-and-compounding holding, not an income pick.

Analyst view: little upside left to the consensus

Analyst table

Company (Ticker)	Rating	Price	Target 1Y	Upside	Analysts
Finning (FTT)	Strong buy	$112.30	$117.80	+4.9%	10
Toromont (TIH)	Strong buy	$236.69	$247.20	+4.4%	10
Russel Metals (RUS)	Buy	$95.21	$78.56	−17.5%	8
Wajax (WJX)	Buy	$39.18	$36.50	−6.8%	6
Average (incl. FTT)	—	—	—	−3.7%	—

Rating & price: TSX screener (October 3, 2026). Target 1Y: MarketBeat consensus (TSE listings), pulled 2026-10-05: FTT C$117.80 (10), TIH C$247.20 (10), RUS C$78.56 (8), WJX C$36.50 (6). None under 5 analysts. Upside = target ÷ price − 1.

The screener rates Finning a Strong buy, and MarketBeat’s consensus target is C$117.80 from ten analysts — only about 5% above the C$112.30 share price. Recent moves are more bullish: Stifel started coverage on September 29 with a Buy and a C$127 target, RBC sits near C$129 and BMO at C$122. Toromont’s consensus is about 4% above its price, while Russel Metals and Wajax already trade above their consensus targets — another sign that the whole group has outrun the Street.

Why it matters: from mining dealer to power business

The old narrative was Finning as a cyclical mining and construction dealer, priced like one. The new narrative is a power and energy business, riding backup-generation demand (including data centres), copper mining in Chile and Western Canadian resource projects, with recurring parts and service revenue underneath.

The John F Hunt Power deal fits that new narrative. It isn’t big enough to move earnings on its own, but it signals where management wants to grow. The open question is how long the market will keep paying a growth multiple for a dealer whose cash flow still swings with working capital.

Bull case

1. Visibility. A record C$3.8B backlog, with orders outpacing deliveries, gives visibility into 2027.
2. A new growth leg. Power rentals and backup-power demand add growth that is less tied to the mining cycle, and the UK deal more than triples Finning’s UK & Ireland rental revenue.
3. Quality of earnings. Product support has grown nine quarters in a row, and adjusted return on invested capital is about 19%.

Bear case and risks

1. Priced for growth. At about 27x earnings after a 30% one-month jump, there is little room for a miss.
2. Thin cash flow. Free cash flow is thin while working capital grows (P/FCF ~69x), and net debt is about 1.6x EBITDA.
3. Macro exposure. Copper prices, Argentina policy and soft UK construction can all hit orders quickly.

What to watch

1. Q3 results, expected in early November. Does the backlog turn into deliveries — and, more importantly, into cash?
2. John F Hunt Power integration. How fast it lifts UK power rental revenue.
3. Data-centre power orders in Canada, where Finning says talks are active.
4. Analyst targets. Whether the Street lifts its targets above the current share price, or the stock drifts back toward the ~C$118 consensus.

Bottom line

Finning has earned its rerating: record revenue and EPS, a record backlog, a credible power-and-energy growth leg, and a steadily growing parts and service business. The John F Hunt Power deal adds to that story without changing the numbers. The issue is price. At ~27x trailing earnings, ~69x free cash flow and only about 5% below the consensus target, a lot of good news is already in the stock. The next test is whether Q3 turns that backlog into cash.

Video chapters

• 0:00 Hook — record high, ~27x P/E
• 0:22 John F Hunt Power deal (October 1)
• 0:49 Q2 print + record backlog
• 1:08 Overview — distribution peers
• 1:33 Performance heatmap
• 1:54 Valuation (~27x / ~22x fwd)
• 2:19 Dividends
• 2:37 Analyst ratings & targets
• 2:48 Recent analyst moves
• 3:07 Why it matters
• 3:30 Bull case
• 3:49 Bear case
• 4:09 What to watch

Data notes

Table figures are TSX screener values (merge tsx-2026-10-03.csv, 3,455 rows; October 2 close; CAD). Peers are same-sector (Distribution services) and business-comparable: Toromont (Cat dealer for Eastern Canada), Russel Metals (industrial/metals distribution) and Wajax (industrial equipment dealer); GRGD, GEI, PBH and MFI were skipped as not comparable, and DBM/ADEN as sub-C$1B. Average rows include FTT and skip blank cells. Target 1Y is MarketBeat consensus pulled 2026-10-05 (FTT 10, TIH 10, RUS 8, WJX 6 analysts). Q2 figures are from Finning’s August 5, 2026 release.

Sources

• Finning news release, October 1, 2026 — acquisition of John F Hunt Power Group Ltd.
• Finning Q2 2026 results release, August 5, 2026
• MarketBeat — FTT consensus and Stifel coverage (late September / October 2026); TIH, RUS, WJX consensus
• TSX screener merge October 3, 2026 (3,455 rows)

Media credits

Wikimedia Commons: Finning logo (File:Finning.svg, public domain); “Caterpillar Diesel Generators” by Bryansfiles (CC BY-SA 3.0); “Finning-Caterpillar at Desford” by Colin Hoskins (CC BY-SA 2.0); “Finning Cat at Ynysmaerdy” by Mick Lobb (CC BY-SA 2.0); “CAT 797 SDB BHPBilliton Escondida Chile” by Duratray (CC BY-SA 4.0). No AI-generated images were used.

By Andrew · stocksummarizer.com