On Wednesday, Bird Construction Inc. (BDT:CN) (OTC: BIRDF) saw its price target increased by Canaccord Genuity from C$23.00 to C$28.00, while the firm maintained a Buy rating on the stock. The upgrade reflects the company's strategic positioning in several growing markets, improved execution, and a record project backlog.
Bird Construction has diversified its market presence, now participating in sectors such as clean power generation, electricity transmission and distribution, water and wastewater treatment, and horizontal infrastructure. This expansion complements the company's ongoing activity in its traditional industrial and mining markets.
The company's adoption of lower-risk collaborative contracting methods has led to enhanced execution and, consequently, better EBITDA margins. With a robust backlog of projects worth $3.5 billion as of the first quarter of 2024, which marks a 28% year-over-year increase, the visibility of the company's future revenue streams appears to be excellent.
Canaccord Genuity anticipates continued organic revenue and margin growth for Bird Construction, bolstered by the potential accretion from the pending acquisition of Jacob Bros. This is expected to contribute to sustained double-digit growth in earnings per share (EPS) and dividends per share (DPS) through the forecast horizon.
In light of these strong fundamentals and the anticipated benefits from the Jacob Bros acquisition, Canaccord Genuity has raised its target multiple to 11 times, up from 10 times, applying this to a new 2025 EPS estimate. The firm's outlook for Bird Construction remains positive, as reflected in the revised stock price target and the maintained Buy rating.
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