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Investing.com - Raymond James downgraded Aecon Group Inc. (TSX:ARE) stock from Outperform to Market Perform on Friday, while raising its price target to C$33.00 from C$26.00.
The downgrade comes despite no apparent issues with Aecon’s third-quarter 2025 results released Thursday, with Raymond James analyst Frederic Bastien citing valuation concerns as the primary reason for the rating change.
Aecon shares have surged approximately 90% since Raymond James’ previous upgrade on April 22, 2025, significantly outperforming the TSX index’s 24% gain during the same six-month period.
The construction and infrastructure company’s strong rally has been largely driven by positive sentiment surrounding the nuclear energy sector, pushing Aecon’s forward EV/EBITDA multiple from 4.0x to 7.1x over the past six months.
Raymond James believes this valuation expansion has created a "more neutral risk-reward setup" for Aecon shares heading into the seasonal construction slowdown period.
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