Aecon Group Inc. Just Recorded A 9.2% Revenue Beat: Here's What Analysts Think
As you might know, Aecon Group Inc. (TSE:ARE) just kicked off its latest quarterly results with some very strong numbers. Results were good overall, with revenues beating analyst predictions by 9.2% to hit CA$1.9b. Statutory earnings per share (EPS) came in at CA$0.74, some 2.8% above whatthe analysts had expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the consensus forecast from Aecon Group's ten analysts is for revenues of CA$6.85b in 2027. This reflects an okay 7.9% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Aecon Group forecast to report a statutory profit of CA$2.06 per share. In the lead-up to this report, the analysts had been modelling revenues of CA$6.81b and earnings per share (EPS) of CA$2.00 in 2027. So the consensus seems to have become somewhat more optimistic on Aecon Group's earnings potential following these results.
See our latest analysis for Aecon Group
There's been no major changes to the consensus price target of CA$60.40, suggesting that the improved earnings per share outlook is not enough to have a long-term positive impact on the stock's valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Aecon Group at CA$70.00 per share, while the most bearish prices it at CA$50.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Aecon Group shareholders.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We can infer from the latest estimates that forecasts expect a continuation of Aecon Group'shistorical trends, as the 6.3% annualised revenue growth to the end of 2027 is roughly in line with the 6.6% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 3.8% per year. So it's pretty clear that Aecon Group is forecast to grow substantially faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Aecon Group following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Aecon Group analysts - going out to 2028, and you can see them free on our platform here.
Don't forget that there may still be risks. For instance, we've identified 1 warning sign for Aecon Group that you should be aware of.
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