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Investing.com - KeyBanc raised its price target on AECOM Technology (NYSE:ACM) to $129.00 from $120.00 on Wednesday, while maintaining an Overweight rating on the stock. AECOM, a prominent player in the Construction & Engineering industry with a market capitalization of $14.7 billion, has demonstrated strong performance with a 24% return over the past year.
The firm cited AECOM’s diversified end market and geographic exposure as the reason for applying a higher multiple to the stock. KeyBanc does not see AECOM’s outlook at risk this year due to this diversification. This aligns with InvestingPro data showing the company’s GOOD financial health score and generally low price volatility.
KeyBanc expects AECOM to reiterate its long-term net service revenue (NSR) growth outlook of 5-8%, with margin expansion of 20-30 basis points per annum, and double-digit EPS growth. The firm anticipates NSR to be toward the lower end of the range in fiscal year 2025. Want deeper insights? InvestingPro offers 12 additional investment tips and comprehensive analysis in its Pro Research Report.
Water/environment and infrastructure modernization were identified as key domestic growth drivers for AECOM, which KeyBanc expects to outpace international growth.
The firm noted that U.K. infrastructure spending and AMP-8 are experiencing a delayed ramp, affecting AECOM’s international growth prospects.
In other recent news, AECOM has launched a $1 billion private offering of senior unsecured notes due in 2033 to refinance existing debt. The company plans to use the proceeds alongside cash on hand to purchase its outstanding 5.125% Senior Notes due 2027. Meanwhile, AECOM has been appointed as the technical advisor for VicGrid, a Victorian government agency in Australia, to support its energy infrastructure program as the region transitions to renewable energy. Additionally, AECOM is part of a group of companies competing for a $3 billion contract aimed at acquiring energy and water conservation services. In a separate development, AECOM secured an $81.3 million contract with the U.S. Army Corps of Engineers to provide environmental remediation services at Vandenberg Space Force Base. The company is also collaborating with the Saudi Ministry of Sport to oversee the renovation of King Fahd Sport City in preparation for major international sports events. These recent developments highlight AECOM’s ongoing involvement in significant infrastructure projects across various sectors.
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