Aecon Group Inc (ARE.TO) Buy, Sell or Hold

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Aecon Group Inc (ARE.TO)

49.50

-0.33 (0.66%)

as of Jul 8, 2026, 8:00:00 pm Market Open.

427 watching

Investor Insights

Jul 8, 2026, 12:00 am

This summary was created by AI, based on 18 opinions in the last 12 months.

Aecon Group Inc (ARE-T) is poised to benefit from the significant infrastructure investment in Canada, with a record backlog reaching over $10.9 billion. Analysts note the shift from riskier fixed-price contracts to more sustainable variable-price contracts, enhancing cash flow stability. While the stock has shown substantial growth recently, with many experts indicating it is currently overbought, there are concerns about short-term volatility. The company's exposure to nuclear projects and ongoing expansion in infrastructure signals promising future growth, despite mixed views on its current valuation. Overall, investors should be cautiously optimistic as Aecon navigates through a challenging construction landscape.

Consensus

Hold

Valuation

Fair Value

Similar

WSP

PAST TOP PICK

(A Top Pick Feb 01/22, Down 35%)

Still mired in cost overruns that's lasting longer than he expected. That said, roads still need to be built and ARE will benefit. Valuation has been punished. Look at Stantec instead in this space, but he is holding onto ARE. He expects a recovery.

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PAST TOP PICK

(A Top Pick Jan 26/22, Down 30%)

Cost overruns on projects entered into a decade ago, a much different economic environment. Nuclear expertise. Would benefit from increased mining development. At steal at these levels. Nice total return for 5-10 years. Yield is 7%, shouldn't have to cut.

DON'T BUY

Am engineering construction company, so margins are lower than WSP's or Stantec's. Have suffered cost overruns and project lays, like many in their sector. They have a backlog, but you don't know the quality of if it. Are better opportunities elsewhere. Doesn't like the sector.

RISKY

Owns it in the aggressive equity platform. It is at the support level of 2015 but may not bounce back. It is a buy only for risk takers.

DON'T BUY

Tough year for the entire space. A lot has to do with fixed-price contracts. Rampant inflation hits profitability. Better opportunities out there. Very well run.

PAST TOP PICK

(A Top Pick Feb 01/22, Down 45%) It has had cost over-runs and some legal suits. It is looking for recovery in some projects - two should be completed next year. Since there are inflationary pressures, it will de-emphasize fixed price contracts which make up about 60% of its backlog. It is quite inexpensive since infrastructure spending should increase at some point.

DON'T BUY

It is more of an engineering and construction company rather than a consulting one. He prefers the consulting type such as Stantec and WSP since there is less risk.

BUY

~7% dividend yield is sustainable. Several good quarters in a row (aside from last quarter). Positive on business in the long term (infrastructure business not going anywhere) Nuclear business will be valuable going forward.

COMMENT

Not that familiar with the company but is with the industry. Prefers WSP and Stantec for global infrastructure rather than engineering construction.

HOLD

Top Pick in February, and he hasn't changed his mind. Hit by rising rates, valuation down. Projects on the go, solid backlog. Bermuda project hasn't worked that well and won't until tourism resumes. Trading under book value.

HOLD

Is a good long term investment (~ 5 year) with large infrastructure projects going forward. Once interest rates cool and inflation decreases, expects increased spending in building. Would advise holding the stock if already hold shares.

COMMENT

Question was on comparing Aecon to Bird. They have good yields of 5%. Backlogs are not as meaningful in this environment. Construction costs are up and there are still supply chain issues. Bird is in a better situation since it has fewer fixed costs.

WATCH

Have been impacted by inflation. Their profit got hit hard last quarter. Watch this more for coming quarters to see how contracts are re-pricing (how much is fixed price?).

DON'T BUY

Great infrastructure play. Huge backlog. You can feel governments starting to spend. Biggest problems are wage increases, input costs, and labour shortages. Many contracts are fixed. Margins compressed. Stay away.

TOP PICK

They had a tough quarter after many of solid results. They had to take write-downs on some fixed-price contracts. However, they signed their biggest-ever contract (with Metrolinx). They are the only qualified constructor of nuclear plants, which are seeing a renaissance now amid the energy shortage. ARE pays a 6% dividend, though shares have plunged. (Analysts’ price target is $14.23)

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Aecon Group Inc (ARE.TO)