The stock of Aecom (ACM 1.81%), which specializes in infrastructure construction consulting and services, has not been looking all that sturdy lately. The company recently posted a quarterly earnings report that wasn't well-received by either investors or analysts.
This caused a sell-off in its stock; according to data compiled by S&P Global Market Intelligence it was falling by almost 22% week-to-date as of early afternoon trading Friday.
Mind the mixed quarter
Aecom's fiscal fourth quarter of 2025 revealed that the company's revenue was just under $4.18 billion, representing a 2% improvement year-over-year. Net income not according to generally accepted accounting principles (GAAP) also ticked higher, rising by 6% to $182 million ($1.36 per share).
Image source: Getty Images.
Stock analysts following Aecom, however, were expecting a notably higher number on the top line -- their consensus estimate was $4.32 billion. On a brighter note, the company scored a slight beat on non-GAAP (adjusted) earnings, as those pundits were collectively modeling $1.34 per share.
The company wrote that it exited its fiscal year with a record backlog, which has risen for five consecutive quarters. Its pipeline of work was also at an all-time high.
In the wake of the earnings report, however, four analysts (by my count) cut their price targets on Aecom, and another downgraded his recommendation.
The latter analyst, Baird's Andrew Wittmann, now feels the stock is neutral; previously, he flagged it as a buy. According to reports, while the pundit still finds much to like about the business -- particularly its embrace of artificial intelligence (AI) technology -- to him it's now fairly valued at current levels.
NYSE: ACM
Key Data Points
The power of potential
Yes, Aecom seems appropriately priced now, as its five-year PEG ratio is close to 1. That said, I believe that as a leader in its niche, Aecom has the potential to benefit significantly from the anticipated increase in infrastructure spending in this country -- especially since it's a stated priority of the current presidential administration. Personally, I'd be more bullish on the potential of the company's stock.
