Fact based stock research
Aecon (TSX:ARE)

CA00762V1094

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Aecon stock research in summary

aecon.com

ANALYSIS: With an Obermatt Combined Rank of 68 (better than 68% compared with investment alternatives), Aecon (Construction & Engineering, Canada) shares have above-average financial characteristics compared with similar stocks. Shares of Aecon are a good value (attractively priced) with a consolidated Value Rank of 100 (better than 100% of alternatives) but show below-average growth (Growth Rank of 43), and are riskily financed (Safety Rank of 38), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 68, is a buy recommendation based on Aecon's financial characteristics. As the company Aecon's key financial metrics exhibit good value (Obermatt Value Rank of 100) but low growth (Obermatt Growth Rank of 43) and risky financing practices (Obermatt Safety Rank of 38), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 100% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	100
Growth Rank	43
Safety Rank	38
Combined Rank	68

Country	Canada
Industry	Construction & Engineering
Index	Human Rights, TSX Composite
Size class	X-Large

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Aecon

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	79	100	100	100
GROWTH
GROWTH	38	15	33	43
SAFETY
SAFETY	54	25	49	38
SENTIMENT
SENTIMENT	n/a	19	13	^new
360° VIEW
360° VIEW	n/a	13	32	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Aecon is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	79	100	100	100
GROWTH
GROWTH	38	15	33	43
SAFETY
SAFETY	54	25	49	38
COMBINED
COMBINED	66	36	67	68

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Aecon the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 100 (better than 100% compared with alternatives) for 2024, Aecon shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Aecon. Price-to-Sales is 95 which means that the stock price compared with what market professionals expect for future sales is lower than for 95% of comparable companies, indicating a good value for Aecon's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 63% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 92. Compared with other companies in the same industry, dividend yields of Aecon are expected to be higher than for 100% of all competitors (a Dividend Yield rank of 100). ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 100, is a buy recommendation based on Aecon's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Aecon based on its detailed value metrics. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	79	96	95	95
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	55	78	74	63
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	56	94	96	92
DIVIDEND YIELD
DIVIDEND YIELD	84	100	100	100
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	79	100	100	100

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Aecon; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 43 (better than 43% compared with alternatives), Aecon shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Aecon. Sales Growth has a rank of 80 which means that currently professionals expect the company to grow more than 80% of its competitors. Stock Returns are also above average with a rank of 97. But Capital Growth has only a rank of 18, which means that currently professionals expect the company to grow its invested capital less than 82% of its competitors. Profit Growth is also low, with a rank of only 1, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 43, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 97% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	47	22	16	80
PROFIT GROWTH
PROFIT GROWTH	5	13	100	1
CAPITAL GROWTH
CAPITAL GROWTH	n/a	73	1	18
STOCK RETURNS
STOCK RETURNS	56	29	61	97
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	38	15	33	43

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Aecon.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 38 (better than 38% compared with alternatives), the company Aecon has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Aecon is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Aecon.Leverage is at 56, meaning the company has a below-average debt-to-equity ratio. It has less debt than 56% of its competitors.Refinancing is at a rank of 72, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 72% of its competitors. Liquidity is at 8, meaning that the company generates less profit to service its debt than 92% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 38 (worse than 62% compared with alternatives), Aecon has a financing structure that is riskier than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. Investors should compare Obermatt’s Value, Growth, and Sentiment Ranks before deciding. They may also want to investigate why cash flows are expected to be low, making debt service for Aecon more challenging. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	45	28	50	56
REFINANCING
REFINANCING	61	92	96	72
LIQUIDITY
LIQUIDITY	52	15	8	8
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	54	25	49	38

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Aecon and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	65	31	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	40	75	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	19	39	^new
MARKET PULSE
MARKET PULSE	n/a	34	16	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	19	13	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Aecon.
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