AECOM (ACM) Stock Forecast & Price Target

AECOM has demonstrated significant financial growth with an increase in Adjusted EBITDA from $657 million in fiscal year 2019 to $1,095 million in fiscal year 2024, reflecting an approximate 11% compound annual growth rate (CAGR). The company's Adjusted EBITDA margin improved from 10.6% to 15.3%, leading to an expansion of 472 basis points, which highlights effective cost management and operational efficiency. Additionally, the company has reported a strong performance in project bidding, achieving a higher win rate and introducing its first-ever dividend, with expectations of annual double-digit increases, further signaling positive financial momentum.

AECOM's outlook is negatively impacted by several fundamental risks that can hinder its financial performance. The company faces potential organic revenue growth shortfalls, higher-than-expected costs, and decreased operational efficiencies, which may lead to margins falling below forecasts and guidance ranges. Additionally, AECOM's substantial reliance on government contracts, coupled with economic weakness, labor shortages, and foreign exchange fluctuations, further exacerbates uncertainties regarding future profitability.