DALLAS - AECOM, a prominent infrastructure consulting firm, has been selected as the design partner for the first phase of the Capital Line South Light Rail Transit Extension project in Edmonton, Alberta. The company, listed on the New York Stock Exchange under the ticker NYSE:ACM, will collaborate with Capital Line Design-Build Ltd., a member of the Ledcor Group, on the 4.5-kilometer extension from Century Park to north of Ellerslie Road.
The extension includes two new stations and a vehicle storage and maintenance facility. AECOM's role will encompass the infrastructure and systems design, featuring an underpass at 23 Avenue and new bridges over Blackmud Creek and Anthony Henday Drive. The stations at Twin Brooks and Heritage Valley North are also part of the project scope.
Mark Southwell, AECOM’s chief executive of the global Transportation business, expressed excitement about contributing to Edmonton's infrastructure, leveraging the company's experience from other urban rail projects. Richard Barrett, chief executive of AECOM's Canada region, echoed this sentiment, highlighting the firm's commitment to supporting sustainable transportation in Edmonton.
AECOM's previous work with the City of Edmonton includes developing policy frameworks for integrating light rail transit planning with land use, as well as updating design guidelines for low and high floor light rail transit systems. The company has also served as the Owner’s Engineer for the Valley Line light rail transit project, a 27-kilometer line developed in two phases.
This announcement is based on a press release statement and follows AECOM's record of delivering major transit expansions. It reflects the company's strategic focus on infrastructure projects that align with its expertise in design and engineering services. AECOM's fiscal year 2023 revenue from its Professional Services business was reported at $14.4 billion.
In other recent news, AECOM has reported a series of significant developments. The global infrastructure consulting firm announced an 8% increase in its third-quarter net service revenue, prompting an upward adjustment of earnings guidance for the second consecutive quarter. AECOM anticipates a 21% boost in adjusted earnings per share for fiscal year 2024.
On the contract front, AECOM secured a key role in managing improvements for the San Diego International Airport, overseeing the modernization of its terminals. The firm also landed contracts for LA's zero-emission bus initiative and Wessex Water's Capital Delivery Framework in South West England. Additionally, AECOM was selected by the New York Power Authority to manage energy transition projects, contributing to a carbon-free New York.
Recent analyst notes from RBC Capital and Citi maintained positive ratings on AECOM's stock. RBC Capital upheld an Outperform rating, citing the firm's effective strategic initiatives and increased infrastructure spending in key markets. Citi reiterated a Buy rating, highlighting AECOM's potential for long-term earnings visibility and strong cash flow generation. These recent developments highlight AECOM's ongoing commitment to enhancing infrastructure and delivering sustainable projects worldwide.
InvestingPro Insights
AECOM's selection for the Edmonton light rail project aligns with its strong market position and growth trajectory. According to InvestingPro data, AECOM's revenue for the last twelve months as of Q3 2024 stood at $15.84 billion, with a robust revenue growth of 13.43% over the same period. This growth is reflected in the company's stock performance, with a 27.78% price total return over the past year.
InvestingPro Tips highlight AECOM's financial strength and market position. The company is expected to grow its net income this year, and it's trading at a low P/E ratio relative to its near-term earnings growth, suggesting potential undervaluation. AECOM's PEG ratio of 0.41 further supports this view, indicating that the stock might be undervalued relative to its growth prospects.
Moreover, AECOM has raised its dividend for three consecutive years, with a current dividend yield of 0.86%. This demonstrates the company's commitment to shareholder returns while investing in growth projects like the Edmonton light rail extension.
For investors interested in a deeper analysis, InvestingPro offers 13 additional tips for AECOM, providing a comprehensive view of the company's financial health and market position.
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