AECOM Posts Mixed Q4 Results

AECOM (ACM) reported mixed results for the fourth quarter of Fiscal Year 2021 as earnings surpassed estimates but revenue lagged. The company engages in the design, build, finance, and operation of infrastructure assets.

Adjusted earnings of $0.81 per share increased 35% year-over-year, and came ahead of the Street’s expectations of $0.77.

Revenue in Q4 declined 6% year-over-year to $3.35 billion. It also missed analyst expectations of $3.38 billion. On an adjusted basis, revenue climbed 1%. Net service revenue increased 6.5% in the Americas and International segments.

Backlog at the end of Q4 was $38.6 billion, which included 18% contracted backlog growth, with increases in both the Design and Construction Management businesses. (See Insiders’ Hot Stocks on TipRanks)

AECOM chief financial officer Gaurav Kapoor said, “Our markets are strong, our balance sheet is in great shape, and we are continuing to invest in building on the inherent advantages in our business model to bring the most value to our stakeholders.”

Fiscal Year 2022 Guidance

The company expects to deliver adjusted EPS between $3.20 and $3.40, and adjusted EBITDA in the range of $880 million to $920 million, which would reflect 17% and 8% year-over-year growth at the midpoint of the respective ranges.

AECOM expects to make capital expenditures of about $160 million, reflecting a temporary increase in fiscal 2022 to support investments in people, clients and digital innovation, as well as ongoing real estate investments to align with flexible work programs.

Wall Street’s Take

Overall, the Street has a bullish outlook on the stock, with a Strong Buy consensus rating based on three unanimous Buys. The average AECOM price target of $77.33 implies upside potential of about 7.1% from current levels.

Smart Score

ACM scores a 9 out of 10 on TipRanks’ Smart Score rating system, suggesting that the stock is likely to Outperform market averages.