Finning’s moat is its unrivaled geographic monopoly as the Caterpillar dealer for the world’s most resource-rich regions. The company doesn’t just sell machines; it owns the “aftermarket” relationship too. With product support revenue (parts and service) now exceeding $1.5 billion per quarter and growing 9% annually, more than half of the company’s revenue is high margin and recurring. As miners in South America and Canada transition toward “green” metals like copper, they are increasingly relying on this company’s fleet management and autonomy solutions to improve efficiency, creating a multi-year tailwind for the stock.
The firm is also operating at peak efficiency following a multi-year restructuring program. The company has successfully lowered its fixed cost base, allowing a higher percentage of every dollar in sales to drop to the bottom line. With the current $2.9 billion backlog acting as a buffer against economic cooling and a management team committed to returning capital via its 24-year streak of dividend increases, the shares offer a rare blend of cyclical growth and defensive stability.
The stock trades at just 19.2 times the company’s forward earnings forecast. This valuation is particularly attractive given the strong backlog.
FINNING INTERNATIONAL INC.(Toronto symbol FTT; www.finning.com) sells and services Caterpillar-brand heavy equipment (such as tractors, backhoe loaders, off-highway trucks and drills) in Western Canada but also South America, the U.K. and Ireland.
The company’s main customers are in the oil and gas, mining, forestry products and construction industries.
Western Canada is Finning’s biggest market, accounting for 48% of overall revenue, followed by South America, mainly Chile, Argentina and Bolivia (39%), and the U.K. & Ireland (13%).
Finning recently sold its on-site refuelling business 4ReFuel business for $400 million. In a separate transaction, Finning and its partners sold their holdings in Compression Technology Corporation (ComTech). That firm provides mobile refuelling of compressed natural gas. Finning received $10 million.
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Excluding those businesses, the company’s revenue in the three months ended September 30, 2025, gained 14.2%, to $2.84 billion from $2.49 billion a year earlier. That’s mainly due to stronger demand for new and used equipment, as well as maintenance services. Earnings before unusual items also jumped 33.0%, to $1.17 a share from $0.88.
Despite the uncertainty caused by tariffs, demand for new equipment remains strong, particularly from Canadian mining firms. Finning’s backlog as of September 30, 2025, was $2.9 billion, up from $2.6 billion at the end of 2024.
Finning’s record gold prices are just one catalyst for this stock
Finning continues to benefit from rising prices for commodities like gold, which increase demand for its mining-related heavy equipment. As well, the Canadian government plans to spend $115 billion over the next five years on new transportation and municipal infrastructure projects.
Finning’s earnings in 2026 will probably improve 11% to $4.63 a share, and the stock trades at a reasonable 19.2 times that estimate.
With the June 2025 payment, Finning raised your quarterly dividend by 10.0%. Investors now receive $0.3025 a share instead of $0.275. The new annual rate of $1.21 yields 1.4%.
Finning has now increased your dividend by an average of 8.1% annually over the last 5 years. Its TSI Dividend Sustainability Rating is Above Average.
Recommendation in The Successful Investor: Finning Int’l Inc. is a buy.
