
TSE:STN
This summary was created by AI, based on 6 opinions in the last 12 months.
Stantec Inc (STN-T) is viewed positively by various experts, primarily due to its solid growth profile and strong free cash flow generation. Concerns regarding the impact of AI on engineering firms are seen as overstated; rather, AI is expected to enhance their service capabilities. The company won a significant contract for water and wastewater infrastructure, indicating a favorable trend in environmental remediation and infrastructure spending. Analysts anticipate approximately 10% growth in both profits and dividends, positioning STN as an appealing investment with a decent yield. Comparisons with WSP highlight Stantec's potential for growth, particularly due to its smaller size, while focusing on safety in the current uncertain economic climate.
WSP Global is pretty much the gold standard. They are pretty much 100% consulting, whereas STN-T and SNC-T are not. He has shied away from the whole sector. The problem is the engineering and construction business, which he has never liked. Margins are razor thin. STN-T wants to get away from E&C. He would buy WSP-T on a correction. STN-T might be a buy at some other point. SNC-T he stays way from and has done so for many years.
They just sold their construction business, which is a catalyst. Their contruction obscured their consulting business which will shine thought now. Got a good balance sheet so they can contine to buy. 17% EPS growth. It's trading below its peers. An infrastructure play, so even in a late cycle they can still attract capital. (1.65% dividend yield; no price target given)
STANTEC vs. AECON - He's studying the infrastructure space closely. He has no criticism about Stantec, but he prefers Aecon for its balance sheet ($260 million in cash) and low debt. And its new CEO has global experience, which is a catalyst for Aecon and will help them go global. He hasn't bought ARE yet, but will.
This is an engineering company that bought MWH, which was a water infrastructure company that had a construction division. They had not been in the construction business before. Construction can have cost overruns that can bite, and this has happened to Stantec and it has hurt their earnings. They are going to put this business up for sale. This company is a prime beneficiary of infrastructure and water spending. He owns this and SNC-Lavalin and sees a good future for both. He thinks that Stantec is better for the short term than SNC. (Analysts’ price target is $37.27)