AECOM’s ACM Portal Connectors team was selected by the Transbay Joint Powers Authority (“TJPA”) for the second phase of the $12 billion Transbay Program in San Francisco.
The second phase of the program involves the company offering program management and construction management services for the Downtown Rail Extension project, also named the Portal.
The responsibilities of the contract include the successful execution of key activities such as obtaining FTA funding, finalizing the procurement plan in 2024, activating collaborative delivery models, designing and building the tunnel stations, and integrating the Portal with existing rail systems and operations.
The Portal sums up the expected work of constructing a 1.3-mile rail extension underneath Townsend and Second Streets in San Francisco. It also includes an underground station at Fourth and Townsend Streets along with the Salesforce Transit Center's basement levels, utility relocation, track and systems work. Once the project is completed, the extension will serve as a key regional rail connection between 11 Bay area transit systems.
Increasing Backlog Driving Growth of AECOM
AECOM has been witnessing robust prospects in each of its segments. Currently, it has a good visibility of a strong backlog and pipelines for the upcoming quarters. Owing to the improving global scenario, which is fostering infrastructural demand around the globe, there has been an increase in demand for ACM’s services. This improving trend is reflected in the company’s backlog levels.
As of the fiscal third-quarter 2024 end, the total backlog was $23.36 billion compared with $23.21 billion in the prior-year period. The current backlog level includes 54.8% contracted backlog growth. Also, the design business backlog rose 3% to $21.89 billion on the back of a near-record win rate and continued strong end-market trends.
The upsurge in backlog and strong pipeline position AECOM well at the early stages of a multi-decade secular growth cycle across its markets. With the $1.2 trillion IIJA funding accelerating in the United States and the U.K. government prioritizing investments in infrastructure, led by the transportation and water markets, the company’s growth prospects in the market seem encouraging.
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Shares of this solutions provider for supporting professional, technical, and management solutions gained 8.7% in the past three months, outperforming the Zacks Engineering - R and D Services industry’s 5.6% growth.
Zacks Rank & Key Picks
AECOM currently carries a Zacks Rank #4 (Sell).
Here are some better-ranked stocks from the Construction sector.
Comfort Systems USA, Inc. FIX currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
FIX delivered a trailing four-quarter earnings surprise of 20.6%, on average. The stock has risen 88.8% in the past year. The Zacks Consensus Estimate for FIX’s 2024 sales and earnings per share (EPS) indicates growth of 29.4% and 50.9%, respectively, from the prior-year levels.
M/I Homes, Inc. MHO currently sports a Zacks Rank of 1. It has a trailing four-quarter earnings surprise of 4.8%, on average. Shares of MHO have gained 65.7% in the past year.
The consensus estimate for MHO’s 2024 sales and EPS implies increases of 9.4% and 20.8%, respectively, from the prior-year levels.
Howmet Aerospace Inc. HWM presently sports a Zacks Rank of 1. HWM delivered a trailing four-quarter earnings surprise of 10.9%, on average. The stock has surged 96.3% in the past year.
The Zacks Consensus Estimate for HWM’s 2024 sales and EPS indicates increases of 12.6% and 39.1%, respectively, from a year ago.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>AECOM (ACM) : Free Stock Analysis Report
Comfort Systems USA, Inc. (FIX) : Free Stock Analysis Report
M/I Homes, Inc. (MHO) : Free Stock Analysis Report
Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report
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