Transurban Group (TCL.AX) stock analysis

In our weekly check, Transurban Group is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 16 pass, warnings: 3, red flags: 6.

About Transurban Group

Transurban Group is an Industrials company (Industrial - Infrastructure Operations) based in Australia, listed on ASX as TCL.AX.

What our checks show for TCL.AX

Red flags

• Net debt is 8.3x a year of EBITDA (debt/equity 2.71). That limits room in a downturn and raises refinancing risk.
• Operating profit does not cover the interest bill (0.8x): interest is paid from cash or new debt.
• Revenue fell 2.5% a year over the last 3 years.
• The dividend takes 751% of profit: little cushion if profit falls.
• Recovering from its deepest fall took about 5.7 years.
• Return on capital (ROCE) is only 3.8%.

Warning signs

• Analysts expect earnings per share to shrink about 1.6% a year.
• The net margin is only 9.5%: little room if costs rise.
• The stock has fallen as much as 57% from a peak. Would you have held through that?

Strengths

• The net margin rose by 9 points over 5 years, to 9.5%.
• The gross margin is 31.6% and has risen by 10.2 points: pricing power is holding.
• Operating cash flow is 5.64x net profit: the profit arrives as real cash.
• Earnings per share grew 79.4% a year over the last 3 years.
• Net profit grew 78.8% a year over the last 3 years.
• Free cash flow is 49.9% of revenue: cash for dividends, buybacks or growth.

Similar companies

FERG · WAB · CARR · PAYX · HO.PA · WCN

Questions

What grade does Transurban Group (TCL.AX) have?

In our weekly check, Transurban Group is graded C (A to F). Of 25 checks on debt, profit, cash flow and trend: 16 pass, warnings: 3, red flags: 6. The grade is a risk check, not a buy or sell recommendation.

What are the main risks of TCL.AX stock?

This week's biggest flags for Transurban Group: High debt, Weak interest cover, Weak revenue growth. In total 9 of 25 checks show a warning or a red flag.

What does Transurban Group do?

Transurban Group is an Industrials company (Industrial - Infrastructure Operations) based in Australia, listed on ASX as TCL.AX.

The grade is a risk check, not a price forecast, and not investment advice. In our 10-year test (S&P 500, 2016-2026), stocks we graded A or B fell more than 30% 2-3 times less often than D or F, without a lower average return.

Updated 2026-10-24

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