AECOM Books $337M Charge on Troubled Project, Slashes Guidance; Stock Near 52-Week Low
ACM is trading near its 52-week low of $66.28 (4.9% above the low).
Summary
AECOM posted a Q3 adjusted loss of $0.50/share after a $337M charge on a legacy construction project, slashing full-year EPS guidance to $3.95–$4.15. Excluding the charge, results were strong with record backlog, but the surprise loss and reduced cash flow outlook hit a stock already near 52-week lows.
Key Events · Earnings and Guidance · ACM
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$337M Construction Project Charge
A $337 million pre-tax loss was recorded on a Construction Management project awarded in 2019, as delayed completion and higher costs took their toll. Substantial completion is expected in Q2 fiscal 2027, and the company is pursuing claims for recovery.
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Q3 Adjusted Loss of $0.50/Share
The GAAP loss came in at $0.65 per share, with an adjusted loss of $0.50. Stripping out the charge, adjusted EPS would have been $1.49—up 11% year-over-year—fueled by strong design business growth and margin performance.
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Full-Year Guidance Slashed
Fiscal 2026 adjusted EPS guidance was cut to $3.95–$4.15 from a prior ~$5.90–$6.10; adjusted EBITDA now stands at $935M–$965M versus ~$1,275M–$1,305M previously. Free cash flow is expected to be only ~$300 million, a sharp drop from earlier expectations.
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Record Backlog and Strong Wins
Total backlog rose 13% to a record $27.8 billion, supported by a 1.6 book-to-burn ratio. Design wins reached $4.0 billion, including two of the largest recompetes in company history with expanded scope.
Analysis · ACM · Trade & Services
A surprise adjusted loss of $0.50 per share hit AECOM's fiscal third quarter, driven entirely by a $337 million pre-tax charge on a single Construction Management project awarded in 2019 under risk terms the company no longer accepts. Excluding that charge, underlying adjusted EPS of $1.49 would have beaten expectations and grown 11% year-over-year, while backlog reached a record $27.8 billion on a 1.6 book-to-burn ratio. Yet the charge wipes out most of the year's profit: full-year adjusted EPS guidance was cut to $3.95–$4.15 from a prior implied ~$5.90–$6.10, and free cash flow is now expected to be only ~$300 million. With the stock already trading near its 52-week low, this earnings shock could test investor confidence despite the strong underlying business momentum.
At the time of this filing, ACM was trading at $69.55 on NYSE in the Trade & Services sector, with a market capitalization of approximately $9.4B. The 52-week trading range was $66.28 to $135.52. This filing was assessed with negative market sentiment and an importance score of 9 out of 10.