In a report released today, Michael Feniger from Bank of America Securities reiterated a Buy rating on Aecom Technology (ACM – Research Report), with a price target of $118.00.
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Michael Feniger has given his Buy rating due to a combination of factors including AECOM’s strong start to the fiscal year 2025. The company reported an impressive EBITDA growth of 8% year-over-year and a free cash flow increase of 28%, primarily driven by the Americas region’s performance. AECOM also slightly raised the lower end of its fiscal year guidance, which aligns closely with consensus expectations, indicating steady organic growth without significant pipeline disruptions.
Additionally, AECOM’s backlog has reached a record high, showcasing a book-to-burn ratio greater than 1.0x, particularly strong in the design business. Despite potential funding concerns related to government agencies, AECOM’s limited exposure to these agencies reduces the risk. The company’s portfolio remains resilient amidst these challenges, providing higher visibility of free cash flow over multiple years, justifying the maintained price objective and reiterating the Buy rating.
In another report released on January 31, Barclays also maintained a Buy rating on the stock with a $105.00 price target.