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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Aecom (XNYS:ACM) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
ACM
Name:
AECOM (XNYS:ACM)
Sector:
162.19M
Industry:
Engineering & Construction
CEO:
Mr. Michael Burke
Total Employees:
51,000
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -20.89% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF AECOM(ACM) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ENGINEERING & CONSTRUCTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
71.67
One Month Price Target:
$72.22
Six Month Price Target :
$74.99
Likely Price in One Year's Time:
Ticker:
$78.3
Likely Trading Range Today Under (Normal Volatility)
$71.44
Price Upper limit ($) :
$72.06
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$67.99
This week:
$63.44
This month :
$55.21
Other Primary facts
Market Cap:
10.01B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
139.65M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
10.89%
-16.89%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$88.73
$80.80
$54.61
$62.54
Medium risk (<10%) entry points
Buy Call
Sell Call
$78.22
Buy Put:
Sell Put:
$76.52
$65.10
$66.82
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
ACM
Sharpe Ratio:
3.89%
Comparison:
ACM, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is -2.04% lower than the industry
& ratio is 70.73% higher than the market/S&P 500 average
Average Returns/Yield of
ACM
Daily returns:
0.11%
Weekly returns:
0.54%
Monthly returns:
2.16%
Yearly returns:
37.49%
Comparison of returns:
Average annual returns/yield (last 3 years) is -30.75% below industry average
Classification:
ACM, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.83
Statistical test of Returns:
ACM has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.55%
Weekly Volatility:
5.71%
Monthly Volatility:
11.41%
Yearly Volatility:
39.54%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.35%
Volatility in last five trading days has been -47.24% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.13%
Weekly VaR:
-11.48%
Monthly VaR:
-22.96%
How Much Can the price of
ACM
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-19%
Worst case (decline):
-79.53%
This translates to price declining to:
$58.01
This translates to price declining to:
$14.67
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
ACM is a 62.05% riskier investment compared to the market/S&P 500 & is 38.83% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -25.03% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
ACM
Beta in relation to market/S&P 500--1.38
Expected beta in 1 year's time:
0.945
Expected beta in 3 year's time:
1.336
Unlevered (debt free) Beta:
0.677
Beta in relation to Nasdaq (XNAS):
0.835
Beta in relation to all global stocks::
0.84
Beta Comparison & Analysis
Beta of competitors/peers::
1.041
Beta is 32.27% higher than peers
Average Industry Beta:
1.325
Beta is 3.90% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
6.87%
Sustainable growth rate is -50.27% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.134
Alpha is -47.03% below industry average alpha yield
Alpha is 852% higher than market/& is unsustainably high
Analysis of Cost of Capital of
ACM
Equity cost of capital:
0.126
Equity cost of capital is 2.90% above industry mean WACC
Unlevered (without debt) cost of capital:
6.18%
Before-tax cost of debt:
5.00%
After-tax cost of debt:
3.95%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.95%
WACC is 16.24% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$94.83
Revenue growth rate per share of (3Y):
3.81
Annual revenue growth rate is -156.02% below industry average
EPS:
$1.45
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$5.18
-
-
Debt per share
$24.82
EBITDA per share
$4.67
Valuation Analysis Today of
ACM
P/E Ratio:
28.02
P/E Ratio of Competitors/Peers:
17.27
P/E ratio is 62.22% higher than main peers & is -3.39% lower than the industry
Stock price/value with industry average P/E ratio: $42.05
ACM is 70.44% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $9.63
Present value of the expected future dividends only: $2.38
P/S (Price to Sales ratio):
0.76
Price to sales ratio is -87.75% below the industry mean
P/B (Price to book value ratio):
3.81
Price to free cash flow: 13.85
Price to free cash flow ratio is -46.80% lower than the industry
Net income growth rate (3Y):
37.09%
Net income growth rate is -614.42% lower than the industry average net income growth rate
Dividend Analysis
-
Dividend yeild: 0.42%
Previous Dividend: $0.15
Previous adjusted dividend: $0.15
Previous Dividend: $0.30
-
-
Average dividend payment (long-term): $0.15
Average dividend increase/decrease (growth rate) % per period: 0.00%
Expected next dividend payment date: 21/07/2022
Expected next dividend record date: 07/05/2022
Expected next dividend declaration date: 06/01/2022
Previous dividend payment date: 22/04/2022
Previous dividend record date: 04/06/2022
Previous dividend declaration date: 03/03/2022
Dividend History:
2022-04-05--$0.15
--$0.00
--$0.00
2022-01-04--$0.15
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
131.95%
Net debt to equity ratio:
95.36%
Debt to assets ratio:
30.28%
Net debt to assets ratio:
21.89%
Debt-to-asset ratio is -43.03% below industry average
Ability to repay debt:
Interest coverage ratio:
3.75
Interest coverage ratio is -84.58% less than industry average
Looking forward:
Debt growth rate:
70.72%
Annual debt growth is -56% lower than industry average debt growth rate
Debt repayment rate in last quarter: 11.71%
Analysis of Key Statistics
Correlation of price movement with the market:
0.705
Statistical significance of correlation:
ACM has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.523
Stock price is 34.84% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.523
Correlation of price movement with Nasdaq (^IXIC):
0.034
Covariance of price movement with the market:
0.051
Kurtosis
8.567
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-1.006
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
ACM
Gross Profit Margin Ratio:
25%
Operating Profit Margin Ratio:
4.61%
Operating profit margin is -133.51% lower than the industry
Net Profit Margin Ratio:
25%
Effective Tax Rate:
21.57%
Effective tax rate is 4.21% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
8.02%
Return on equity (ROE) is -31.73% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
1.84%
Return on assets (ROA) is -55.30% lower than the industry
Financial Leverage:
1.4x
Current Ratio:
1.08
Current ratio is -61.77% below industry average
Cash Conversion Cycle (days):
11.1
Cash conversion cycle is -76.53% below industry average
The remaining useful life of property plant & equipment is: 3.7 years
Stock based compensation to net income ratio:
4.66%
In-depth Efficiency Analysis
Revenue generated per employee:
259.7K
Each employee generates -57% less revenue than industry average revenue per employee
EBITDA generated per employee:
12.8K
Each employee generates -66% less EBITDA than industry average revenue per employee
Profit generated per employee:
4.1K
Each employee generates -732% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
3.2K
Each employee generates -149% less free cash flow than industry average revenue per employee
Assets/Capital per employee
108.1K
Each employee generates -149% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
ACM
HUBBELL INCORPORATED (XNYS:HUBB)
THE TORO COMPANY (XNYS:TTC)
LENNOX INTERNATIONAL INC. (XNYS:LII)
AMERICAN FINANCIAL GROUP, INC. (XNYS:AFGE)
ALLEGION PUBLIC LIMITED COMPANY (XNYS:ALLE)
KNIGHT-SWIFT TRANSPORTATION HOLDINGS INC. (XNYS:KNX)
PENTAIR PUBLIC LIMITED COMPANY (XNYS:PNR)
Regal Rexnord Corporation (XNYS:RRX)
DTE ENERGY UNT (XNYS:DTP)
Current Analyst Ratings
Strong buy�13%
Buy�17%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
13.24B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
12.41B
828.95M
-
81.30M
154.30M
-
- 73002.00K
81.30M
-
173.69M
180.75M
651.80M
610.48M
210.53M
402.50M
86.83M
210.53M
Statement of Cash Flow
Date:
Period:
41.37M
Differed Income Tax :
-
Stock Based Compensation :
9.81M
Change in Working Capital :
32.08M
Accounts Receivables:
88.13M
Other Working Capital:
- 46832.00K
Other Non-Cash Items:
50.32M
Net Cash Provided by Operating Activities:
194.86M
Investments in PP&E:
546.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
12/31/21
2022
Q1
967.79M
-
967.79M
2.58B
-
2.38B
5.93B
985.90M
3.50B
50.17M
-
373.30M
605.62M
5.51B
-
11.44B
2.04B
6.72M
67.29M
-
3.46B
5.51B
3.47B
- 167828.00K
3.30B
-
8.82B
1.41M
- 676902.00K
- 899172.0K
4.20B
December 31, 2021 at 12:00:00 AM
12.49B
2.63B
11.44B
-
3.47B
2.5B
6.12M
- 55239.00K
- 48571.00K
- 459675.00K
8.37M
- 262308.00K
-
424.71M
- 288903.00K
- 790.00K
- 143409.00K
1.09B
1.23B
194.86M
- 32665.00K
162.19M
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
ACM
2023
2024
2025
2026
2027
$65.36
$71.40
$78.01
$85.23
$93.11