WSP Global Inc. (WSP.TO)

We're at a point in the market where this type of thing will come out. Be careful with these types of reports. It could be that whoever wrote the report has covered his short by now.

He likes the engineering group. Give it some space, 4-5 days, to see if things firm up. Pick a stop, and then see what happens over the next few days.

Likes the environmental space so much they launched Canada's first Global Biodiversity Fund, comprised of about 40 stocks. These stocks are focused on halting and reversing nature loss and restoring ecosystems. Companies like WSP, WM, and CLH will benefit from massive tailwinds driven by conservation targets.

Likes the sector of engineering services, instead of construction. 77% of STN revenue comes from NA. She owns WSP. Nothing wrong with STN, though it's smaller. Since STN is smaller, it might be able to grow faster.

WSP revenue from NA is 50% or slightly below, so it's more global. Starting to see organic growth pick up from its bigger acquisitions in very attractive markets. Growth profile slightly better.

Both grow organically and through M&A.  Both have balance sheet support to do M&A.

Homerun. Incredibly well run. Priced for perfection, don't buy here. If stock fell, he'd certainly take a look. Great Canadian company.

He's been adding to this since the 2022 correction. Very well-managed. These companies benefit from massive global trends in infrastructure. Yes, these companies are expensive but enjoy huge growth tailwinds. They're growing in environmental services. Definitely hang on if you own, or buy.

Engineering design firm not associated with liabilities of construction. M&A very strong the past few years. Strengthening environmental reclamation business. Beneficiaries of US Inflation reduction act. Excellent balance sheet allows for growth. Very strong management team that is proven in all aspects of market cycles. 

Government and business are and will develop infrastructure in Canada. WSP is 50/50 government and business. WSP has a footprint in most OECD countries, a massive company, so they have local expertise around the world and gives them a competitive advantage. Are asset-lite, with their big expense being their employees. Have a healthy backlog. A consistent company. They rely on M&A to make acquisitions, large and small. Debt is a healthy under-2x EBITDA. Expect an acqusition soon.

Her choice in the sector. It doesn't do construction, just engineering services and consulting. It's in all the verticals that are experiencing growth: environment, roads, infrastructure. Grows through acquisition plus organic growth.

Valuations are roughly comparable, and rich. WSP is bigger and more global. If you own WSP, don't sell, let it keep working. Access to capital for WSP is favourable. 

Return on STN has been better this year, but that's because it was undervalued coming in. A switch wouldn't be that helpful.

Very global, only 18% revenues from Canada. Well-positioned long term for infrastructure spending and energy transition. Backlog growing, as are margins. Disciplined acquirers. Balance sheet good. Organic growth 6-7%.

The question was on comparing WSP Global and Waste Connections. The companies are very different. WCN is in the waste management business and WSP Global is more on the engineering side. Waste management is an important field and a consistent business. WCN traditionally has had an expensive valuation. Both are good companies. Hold or wait to buy.

Engineering services growing. Would be a good time to buy. Would diversify with other names in sector. Overall, positive trends behind the company. 

WSP has seen a declining dividend yield over the past decade, from ~5% to 6% to its current less than 1% yield. The stock has become focused on paying down debt and acquisitions, alongside continuous, steady dividend payments. WSP has been in the income model portfolio for years, coming from a high yield to a now relatively lower yield. The income model portfolio aims to target an average portfolio yield of 4% to 5% and a total return target of 6% to 8%. We feel that while WSP does not help to bring up the average yield, the model portfolio continues to hold an average portfolio yield in the 4% to 5% range, and WSP's strong price appreciation has helped to near the total return target of 6% to 8%. 
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He's traded this stock many times. It has consolidated, but is breaking out. Would re-enter at $175.