AECOM: A 16.5% Segment Margin and 12.1x Earnings Are Genuinely Cheap, but First-Half Free Cash Flow of 15 Million Dollars Means 72.39 Dollars Only Buys the Base Case

This does not make the margin story fictitious. AECOM’s segment margin has risen from 12.3% in fiscal 2020 to the mid-16% range, while the Americas design business reached a 20.0% adjusted operating margin in fiscal second-quarter 2026. The transformation removed self-perform construction, exited lower-return countries, reduced real-estate and corporate overhead, shifted delivery into enterprise capability centers and concentrated investment on larger, more technically complex pursuits. Those actions changed the economic quality of each dollar of net service revenue.

The remaining runway is narrower than the historical record makes it appear. AECOM expects a 20% or higher margin exit rate by fiscal 2028. The Americas segment is already close to that level, while International produced an 11.1% margin in the latest quarter. Further enterprise expansion requires International improvement, continued mix gains, technology and shared-delivery productivity, or a greater contribution from advisory and high-value program management. Cost reduction alone cannot plausibly provide another eight years of the gains achieved since 2020.

Backlog supports the revenue outlook, but its quality matters. At March 31, 2026, total segment backlog was $26.20 billion, 8.0% above the prior year. Design-only backlog was $24.66 billion, or 94% of the total. Contracted backlog was $13.82 billion, only 53% of the total, while $12.38 billion was awarded but not yet contracted. Contracted backlog grew approximately 4%; awarded backlog grew approximately 13%. International backlog increased 25%, versus 2% in the Americas. The headline acceleration came mainly from international awards and from work that had been selected but had not yet reached the same legal or funding certainty as contracted work.

The company’s 22 consecutive quarters with design book-to-burn above 1 are a favorable indicator of franchise health. They do not prove near-term revenue acceleration. Infrastructure awards can take months to contract, receive appropriations, move through permitting and mobilize. Some public contracts are funded one fiscal year at a time, and clients may terminate or reduce work. AECOM’s fiscal 2025 10-K separately reported $39.7 billion of gross backlog and only $19.7 billion of remaining performance obligations under the accounting standard. Management estimated that 57% of those remaining performance obligations would be recognized within 12 months and most of the rest over the following two years. The large gap among total gross backlog, segment backlog, contracted backlog and accounting performance obligations is why backlog should be treated as a hierarchy of probabilities rather than one dollar amount.

Cash conversion is the immediate test of management’s earnings narrative. AECOM generated $685 million of free cash flow in fiscal 2025 and says average free-cash-flow conversion since fiscal 2020 was 114%. In the first half of fiscal 2026, operating cash flow fell to $74 million from $342 million, while capital expenditure rose to approximately $60 million. Free cash flow was consequently only about $15 million. Receivables and contract assets consumed $347 million, days sales outstanding rose to 83 from 74 at fiscal 2025 year-end, and the company spent $442 million on repurchases plus $76 million on dividends. The excess shareholder distribution was financed from accumulated cash and incremental balance-sheet use, not current-period free cash flow.

Management attributes much of the delay to collections on several Middle Eastern claims and says collections improved during the fiscal third quarter. That may prove correct on August 10. Until cash arrives, the claim remains a forecast rather than cash evidence. The distinction matters because AECOM’s buyback program is an important part of adjusted-EPS growth. Buybacks funded by durable free cash flow create value at modest multiples; buybacks funded by reducing a cash balance while receivables rise can simply transfer working-capital risk onto the balance sheet.

Public funding is both support and risk. In fiscal 2025, 7% of revenue came directly from the U.S. federal government, 24% from U.S. state and local governments and 19% from non-U.S. governments. Government clients made up 50% of revenue. Federal infrastructure grants also flow through state, municipal and quasi-public clients, making indirect U.S. federal exposure larger than the disclosed 7%. No individual client accounted for 10% or more of revenue.

The U.S. infrastructure program has not run its course. The U.S. Government Accountability Office identified $711.8 billion of potential Infrastructure Investment and Jobs Act grant funding, including $131.2 billion becoming available for obligation in fiscal 2026. The Department of Transportation continues to publish monthly funding status. The United Kingdom’s water regulator approved £104 billion of spending for the 2025–2030 regulatory period, while Infrastructure Australia’s five-year major public-project pipeline reached A$242 billion. These programs provide multi-year design and program-management demand, although appropriations, permitting, inflation and client capacity govern the conversion rate.

At $72.39, AECOM trades at approximately 12.1 times the midpoint of fiscal 2026 adjusted-EPS guidance and 8.7 times guided adjusted EBITDA after adding about $1.71 billion of net debt to market capitalization. The forward adjusted P/E is well below Jacobs’ approximately 19 times its fiscal 2026 guidance midpoint and Tetra Tech’s approximately 21.5 times. The discount is real. It cannot be interpreted without the cash-flow gap: fiscal 2026 free-cash-flow guidance of approximately $400 million gives a current-year FCF yield of only 4.2%, compared with a 7.2% yield on fiscal 2025 FCF.

Qualitative portrait: a margin-led re-rating candidate with a cash-conversion test. AECOM has become a higher-quality company than it was before 2020. The market’s discount is partly justified by low near-term volume growth, a backlog containing almost as much awarded as contracted work, residual claims, aggressive shareholder distributions during a weak cash period and an earnings bridge unusually dependent on tax. It could become a genuine mispricing if contracted backlog begins converting into 4%–6% net service revenue growth while free cash flow returns above $600 million. The August 10 release will be more important for collections and working capital than for adjusted EPS alone.

Vertical company and financial history

Origins and listing. AECOM traces its formal independent identity to 1990, when five entities were combined into AECOM Technology Corporation, although predecessor engineering businesses extend back more than a century. One corporate predecessor, Ashland Technology Company, had been formed in 1980 as a subsidiary of Ashland. The institutional starting point was a federation of technical consultancies rather than a founder-led product company. That history still shapes AECOM: clients purchase credentials, local relationships and accumulated project experience, while the organization tries to make thousands of specialists operate as one network.

AECOM went public on the New York Stock Exchange on May 9, 2007. The IPO sold 35.15 million shares at $20, implying gross proceeds of approximately $703 million. Its capital-markets story was straightforward: consolidate a fragmented engineering and technical-services industry, use a public balance sheet to acquire regional expertise, and serve government and commercial infrastructure clients at global scale. The shares closed their first week at $21.85, with an equity value around $2 billion.

The first stage was the global-roll-up period. AECOM bought local design, environmental and project-management firms to obtain qualifications, personnel and customer relationships that are difficult to build organically. Acquisitions expanded geography and end markets, but also accumulated goodwill and organizational complexity. The strategy culminated in the 2014 acquisition of URS for approximately $4 billion of equity value and $6 billion of enterprise value, including assumed debt. URS added federal, industrial, construction and maintenance exposure and changed AECOM from a comparatively asset-light design federation into a broader engineering-and-construction conglomerate.

The URS combination increased scale but weakened the simplicity of the investment case. Fixed-price and self-perform construction contracts exposed AECOM to cost overruns, claims and cash volatility. Management Services added valuable U.S. government operations but competed for capital with the design franchise. Debt rose, goodwill expanded and the market had to evaluate several businesses with different margins, risks and working-capital needs under one ticker.

The decisive turn came between fiscal 2019 and fiscal 2022. AECOM sold Management Services for $2.405 billion on January 31, 2020. It divested the power-construction business in October 2020, the civil-construction business in January 2021 and the oil-and-gas construction business in January 2022. These transactions removed most self-perform, at-risk construction revenue and used sale proceeds to reduce leverage and fund repurchases. They also crystallized disposal losses and left selected claims, guarantees and working-capital settlements behind.

Fiscal 2020 was both the trough and the beginning of the current story. Continuing professional-services revenue was $13.2 billion and net service revenue was $6.2 billion. Segment adjusted operating margin rose 160 basis points to 12.3%, despite pandemic disruption. Free cash flow was $341 million, including $122 million related to a Management Services working-capital adjustment, and the company ended the year with $1.8 billion of cash, $2.1 billion of debt and net leverage of 0.3 times. AECOM repurchased $455 million of stock from the start of September through mid-November, reducing diluted shares by about 6.5%.

Troy Rudd, previously AECOM’s CFO and an employee since 2009, became CEO effective October 1, 2020. His “Think and Act Globally” strategy attempted to turn the federation into a common operating platform. The practical elements were fewer countries, more shared technical delivery, consolidated real estate, common systems, larger pursuit discipline and greater emphasis on design, advisory and program management. It was a financial strategy as much as a cultural one: improve utilization and project selection, lift margins, convert cash and retire shares.

The first part of that strategy worked. Free cash flow increased to $583 million in fiscal 2021 and $586 million in fiscal 2022. Operating cash flow ran $714 million in fiscal 2022 and $696 million in fiscal 2023, then reached $828 million in fiscal 2024, the year free cash flow hit $708 million. The fiscal 2024 segment adjusted operating margin was approximately 15.6%, up 90 basis points year over year.

The transformation also changed revenue optics. Gross revenue rose from $13.2 billion in fiscal 2020 to $16.1 billion in fiscal 2025, a roughly 4% compound rate. Fiscal 2025 gross revenue was essentially flat year over year, but pass-through costs fell from approximately $8.9 billion to $8.6 billion, implying that net service revenue rose from roughly $7.2 billion to $7.5 billion. Gross revenue understated the growth in employee-generated service revenue because subcontracted activity declined.

† Fiscal 2020 free cash flow included a $122 million Management Services working-capital receipt. Figures follow AECOM’s fiscal years ending near September 30; H1 FY2026 ended March 31, 2026.

The business reason behind the table is more important than the linear progression. Revenue was not the primary compounder. AECOM removed low-margin revenue, improved contract selection, cut property and corporate costs and reduced shares. From fiscal 2020 to fiscal 2025, net service revenue grew at approximately 4% a year, while adjusted EPS rose at a rate close to 20%. That divergence created a great deal of value, but it also means the historical EPS rate cannot be extrapolated without assuming further margin gains and repurchases.

Fiscal 2025 showed the model near its best. Revenue was $16.14 billion, operating income increased 24% to about $1.0 billion, net income rose 26% to $638 million, diluted GAAP EPS gained 29% to $4.79 and free cash flow was $685 million. AECOM returned about $500 million through repurchases and dividends and had returned more than $3 billion since fiscal 2020.

Fiscal 2026 exposed the model’s remaining variability. First-half segment margins improved, but operating cash flow fell almost 80%. Net receivables and contract assets, after contract liabilities, increased from $3.19 billion at September 30, 2025 to $3.50 billion at March 31, 2026. Days sales outstanding rose nine days. Cash declined from $1.59 billion to $1.03 billion while total debt rose to approximately $2.75 billion.

AECOM still had substantial liquidity. At March 31, 2026, it had approximately $1.50 billion available under its revolver. The debt stack included roughly $1.45 billion under the credit agreement, $1.20 billion of 6% senior notes due 2033 and about $98 million of other debt. Net debt was approximately $1.71 billion, and management reported net leverage of 1.2 times. This is not distress leverage, but the trend moved in the wrong direction because repurchases exceeded current cash generation.

Legacy exposures remain visible in several places. The pension deficit was $66.5 million at March 31, down from $89.4 million at fiscal 2025 year-end. Standby letters of credit and guarantees were around $900 million, although these are contingent rather than funded debt. AECOM also had a $14 million joint-venture investment classified as held for sale and $25.6 million of lending exposure. Goodwill was approximately $3.7 billion, reflecting the acquisitive history.

The DOE and refinery matters explain why discontinued operations cannot be dismissed as harmless presentation. In the DOE case, a former affiliate performed a deactivation and demolition project under a contract that shifted to an at-risk structure in 2011. AECOM retained 90% of future economic outcomes after selling Management Services. In the refinery matter, it retained the project claims and liabilities after the sale. The company has resolved several claims favorably, but the fiscal 2026 DOE adjustment shows that estimate revisions can still reduce equity and obscure reported profit.

Cash conversion across the cycle is better than the first half of fiscal 2026 suggests, but headline ratios require care. For fiscal 2023–2025, aggregate operating cash flow was approximately $2.35 billion versus aggregate GAAP net income of about $1.20 billion, a ratio close to 2.0 times. That ratio is inflated by discontinued-operation charges that depressed fiscal 2023 net income. On management’s adjusted continuing basis, average free-cash-flow conversion since fiscal 2020 was 114%, a more representative historical indicator. The fiscal 2026 first-half deterioration looks like a working-capital shock against a strong prior record, rather than proof that previous earnings were fictitious. It still requires actual collection.

Capital expenditure is low relative to revenue. Fiscal 2025 operating cash flow of $822 million and free cash flow of $685 million imply about $137 million of net capital expenditure, less than 1% of gross revenue. AECOM does not disclose a clean maintenance-versus-growth split. For owner-earnings analysis, I treat 80%–100% of capital expenditure as maintenance because computers, software, workplace infrastructure and technical equipment must be renewed even when the business does not grow. This assumption produces fiscal 2025 owner earnings of approximately $685 million to $712 million.

Return on tangible operating capital is high because clients fund much of the project asset base and AECOM needs little physical capital. Return on total invested capital is less exceptional once the $3.7 billion of goodwill and acquired intangibles are included. Buybacks further reduce book equity, making reported ROE an increasingly poor measure of operating advantage. The economic evidence is the combination of low capex, mid-teens service margins and historically strong cash conversion, not a mechanically elevated ROE.

The share-price story follows these business phases. The IPO at $20 priced AECOM as a global consolidator. The URS period added scale but also debt and contract uncertainty, limiting the multiple investors would pay. The 2019–2021 disposals shifted the narrative to a professional-services re-rating. AECOM repurchased 13.9 million shares at an average price around $45 by early 2021, well below the July 2026 price, creating value for continuing holders.

The current valuation has partially reversed that re-rating. AECOM’s trailing GAAP P/E is about 20.6 times because trailing GAAP EPS is $3.52, but the stock trades at only 12.1 times fiscal 2026 adjusted-EPS guidance. The gap between GAAP and adjusted earnings reflects restructuring, discontinued operations, financing charges, fair-value items and other exclusions. The low adjusted multiple is the market’s judgment that $6.00 of adjusted EPS is not equivalent to $6.00 of clean, recurring owner earnings.

Governance is conventional: one share, one vote, with no controlling shareholder and no dual-class structure. Troy Rudd owned 269,504 shares as of January 9, 2026, while all directors and executive officers owned 591,308 shares, less than 1% of outstanding stock. The proxy calculated Rudd’s ownership at 24.3 times salary, above the required six times, but much of the position reflects equity compensation. His fiscal 2025 total compensation was $16.0 million, including $12.1 million of stock awards.

The compensation plan includes days sales outstanding and adjusted EBITDA, which is sensible for a labor-and-working-capital business. Relative total shareholder return also affects long-term awards. The potential weakness is that adjusted metrics can reward executives despite large discontinued or restructuring charges. Management has delivered its margin and per-share targets, but fiscal 2026 cash performance weakens the case for unqualified praise.

Commentary about “insider buying” should be treated carefully. The proxy confirms meaningful executive ownership relative to salary, but it does not establish a large, recent open-market purchase program. The public evidence reviewed for this report is insufficient to make insider buying part of the investment thesis. Equity-award accumulation and mandatory ownership are alignment signals, not the same signal as executives committing large sums of fresh after-tax cash.

Business model, moat and industry cycle

AECOM reports two principal operating segments, Americas and International, plus residual AECOM Capital items. In fiscal second-quarter 2026, Americas gross revenue was $2.91 billion and net service revenue was $1.19 billion. International gross revenue was $890 million and net service revenue was $754 million. Pass-through costs were 59% of Americas gross revenue but only 15% of International revenue. Enterprise-wide, pass-through costs represented almost 49% of gross revenue.

† Enterprise operating figures exclude or separately treat corporate, AECOM Capital and non-controlling-interest items under AECOM’s non-GAAP presentation. The 16.5% margin is the segment aggregate ($239 million plus $84 million on $1,948 million), so it is not the $280 million enterprise figure divided by net service revenue.

Gross revenue is a poor cross-company profitability denominator. AECOM recognizes subcontractors and other project costs as revenue and expense in many arrangements. Those costs carry little margin and can move sharply with construction-management project phase. Management measures segment margins against net service revenue instead. Jacobs uses “adjusted net revenue”; Tetra Tech reports “revenue, net of subcontractor costs”; European consultancies often emphasize net revenue. Any peer comparison based on gross operating margin would penalize the company with the most pass-through activity rather than the weakest consulting economics.

Americas is the profit engine. It contains U.S. and Canadian design, program management and construction management and produced a 20% adjusted operating margin in the latest quarter. Americas design net service revenue grew 8%, while total Americas NSR grew 5%. International was the weaker segment because Asia and the Middle East declined, although the United Kingdom, Australia and parts of the Middle East have strong pipelines.

The cost structure is dominated by compensation. Engineer and consultant salaries are semi-variable: headcount can be adjusted over time, but cutting too quickly destroys client relationships and scarce technical capability. Utilization, project mix, wage inflation, billing rates and worksharing determine near-term margin. Subcontractors are highly variable and largely pass through the income statement. Property, corporate systems, insurance and bid costs are more fixed. Restructuring since 2020 reduced office and organizational costs, but business-development expense has risen as AECOM pursues larger projects.

Operating leverage is moderate. A 1% change in gross revenue says little because pass-through can move independently. The same 1% change in NSR has greater profit sensitivity, because a portion of employee and corporate costs is fixed over a quarter. In a downturn, utilization falls before headcount can be reduced, creating negative leverage. In an upturn, higher utilization and rate realization can expand margin, but wage competition eventually absorbs part of the benefit.

AECOM does not need manufacturing capex or large research laboratories to maintain its core franchise. It must invest continuously in hiring, technical training, digital tools, bid teams, insurance and global delivery centers. Much of this spending runs through operating expense rather than capex. An asset-light balance sheet does not mean the moat is costless to sustain.

The client mix is diversified but policy-dependent. U.S. federal clients represented 7% of fiscal 2025 revenue, U.S. state and local governments 24%, non-U.S. governments 19% and private clients 50%. No client exceeded 10%. This protects AECOM from single-customer failure, but half the portfolio ultimately depends on tax receipts, regulated-utility plans, bond issuance and annual appropriations.

The contract mix also requires nuance. In fiscal 2025, 38% of gross revenue came from cost-reimbursable contracts, 37% from guaranteed-maximum-price arrangements and 25% from fixed-price contracts. Cost-reimbursable work offers lower project risk but can be terminated or reduced. Fixed-price design work can be attractive when scope is controlled, yet losses occur when labor hours, inflation or technical complexity are underestimated. Guaranteed-maximum-price construction-management work exposes AECOM to subcontractor and cost risk even without self-performing the physical construction.

The backlog illustrates this mixed risk. March 2026 total backlog was $26.20 billion, consisting of $18.10 billion in the Americas and $8.10 billion International. Design-only backlog was $24.66 billion, leaving approximately $1.54 billion related to construction management. Contracted backlog was $13.82 billion and awarded backlog $12.38 billion.

Calculations use the company’s current and prior-year segment tables.

Backlog is strong, but its fastest-growing portion is less firm than contracted work. An award may mean that AECOM has been selected, but contract negotiation, funding, permitting and client timing can delay revenue. The International segment produced almost all of the enterprise backlog acceleration, increasing $1.62 billion year over year. Americas increased only $316 million. A Middle Eastern pause or delayed United Kingdom procurement would affect the strongest headline growth component.

Backlog margins are not disclosed. Management argues that recent large pursuits carry greater strategic value and that an 80% win rate on its largest opportunities reflects selective bidding. That is encouraging, but investors cannot independently confirm whether new awards carry margins above the existing book. Margin improvement could reflect better contract economics, cost actions or favorable execution on older work. The absence of award-margin disclosure is a material blind spot.

AECOM’s 10-K backlog disclosure is broader than its quarterly segment presentation. At September 30, 2025, gross backlog was $39.7 billion, while accounting remaining performance obligations were $19.7 billion. Gross backlog included selected work not yet signed and periods beyond enforceable termination rights. The accounting amount excluded work that did not satisfy the revenue-standard definition. Fifty-seven percent of remaining performance obligations was expected within 12 months.

The historical disconnect between backlog and revenue follows from these definitions. Fiscal 2020–2025 gross revenue and NSR grew around 4% annually, even while reported backlog remained at record levels. Backlog is a rolling stock of multi-year projects, not a one-year revenue forecast. Awards can replenish years of future work while near-term revenue remains constrained by client authorizations, available labor, working days and project mobilization.

AECOM’s real moat has four parts. Qualification and past performance come first. Public agencies and infrastructure owners prequalify suppliers based on licenses, safety, relevant project experience, financial capacity and personnel. A firm that has already designed a rail system, water plant or airport terminal has lower perceived execution risk on the next comparable project.

Client and project familiarity is the second part. Design and program-management work becomes embedded in technical standards, permitting records, stakeholder relationships and asset history. AECOM says recompete win rates exceed 90%, although this is a management claim rather than audited data. Switching remains possible, especially when public procurement requires rebidding, but incumbency can improve bid quality and mobilization speed.

Third is breadth of talent. AECOM can assemble specialists across transportation, water, environment, buildings, energy and program management for complex, multi-disciplinary work. Shared global delivery can improve capacity and cost. This matters most on large pursuits where a regional boutique lacks enough technical depth and a general contractor lacks independent advisory credibility.

Risk capacity and reputation complete the list. Large public clients need counterparties able to carry insurance, bonding, cyber controls, quality systems and long-duration liability. Scale narrows the pool of credible bidders. It does not eliminate competition because the industry remains fragmented and has limited physical-capital barriers. Professionals can leave, clients can split scopes and regional firms can win on relationships or price.

AECOM’s moat is moderate rather than strong. Credentials, scale and client familiarity support repeat work and selective pricing. They do not create network effects, proprietary standards or a cost advantage immune to employee mobility. The strongest evidence of moat is sustained book-to-burn above 1 and rising Americas design margins. The weakest evidence is organic NSR growth that remains well below the EPS growth rate.

Technology and artificial intelligence are productivity tools, not a separate revenue franchise. AECOM disclosed two AI-related wins with nearly $1 billion of aggregate client value, although one was not yet in backlog, and described gain-sharing arrangements intended to improve margins. The likely benefit is reduced design time, better data processing and more scalable advisory output. Clients may retain part of the savings through competitive procurement, so AI should not be valued as software-like recurring revenue.

The infrastructure-consulting industry is mature, fragmented and policy-sensitive. Demand grows with urbanization, maintenance backlogs, climate resilience, water quality, energy-system changes and public spending rather than with rapid product penetration. The highest-quality profit pool sits in front-end advisory, specialist design, environmental permitting and program management, where intellectual property is embodied in people and liability is lower than physical construction.

AECOM’s primary cycle is the public-budget and infrastructure-capex cycle. The industrial economy matters indirectly through private buildings, energy and manufacturing, but government appropriations and regulated-utility plans are the larger drivers. The cycle has long duration: funding authorization precedes design, permitting and construction, and professional-services revenue often continues through several budget years.

U.S. direct federal exposure is only 7%, but state and local exposure is 24% and often supported by federal grants. GAO reported that $131.2 billion of identified IIJA grant resources became available for obligation in fiscal 2026. Management said more than half of relevant infrastructure-law spending remained to be spent. A material appropriations change would first slow awards and notices to proceed, then reduce design utilization months later. It would not immediately erase all contracted backlog.

The fiscal first-quarter 2026 federal shutdown offers a small stress test. Management said a 43-day shutdown delayed awards, but Americas design still achieved a 1.0 book-to-burn ratio and enterprise backlog increased 9%. That supports resilience, although one quarter cannot establish immunity to a multi-year funding reduction.

The United Kingdom water cycle is unusually supportive. Ofwat approved £104 billion of water-company expenditure for 2025–2030, a large increase in investment intended to improve water supply and environmental performance. AECOM’s capabilities in water, environment and program management are aligned with that plan. Delivery constraints, regulatory appeals and utility financing are the conversion risks.

Australia’s five-year major public-infrastructure pipeline reached A$242 billion in the 2025 Infrastructure Market Capacity Report, with substantial buildings, utilities and transport activity. The opportunity is paired with labor scarcity and delivery-capacity risk. A consultancy can benefit from labor-rate inflation if contracts reprice, but margins suffer if fixed-price scopes were bid before wage increases.

The Middle East is the most visible near-term geographic uncertainty. Conflict and project delays reduced enterprise NSR growth by around one percentage point in fiscal second-quarter 2026. International backlog nevertheless rose 25%, including large Middle Eastern wins. A pause would affect backlog conversion and working capital before it necessarily caused contract cancellations. Some regional operations are joint ventures, reducing the impact on attributable profit relative to revenue.

Currency provided a modest fiscal second-quarter tailwind. Enterprise NSR increased 4% as reported but 2% at constant currency, implying roughly two percentage points of translation benefit. About 27% of fiscal 2025 revenue came from clients outside the United States. FX changes affect reported growth and the dollar value of international backlog, although local revenue and labor costs provide partial economic matching.

Horizontal peers and current fundamentals

AECOM competes in a broad field, but no single peer matches the portfolio exactly. Jacobs Solutions is the closest U.S.-listed comparison in global design, program management and advanced facilities. Tetra Tech is a higher-growth water and environmental consultancy. Parsons combines infrastructure with defense and technology work. WSP Global, Stantec and Arcadis are international design-consolidation platforms. Leidos and Amentum are useful government-services references but carry substantially more defense, intelligence and technology exposure.

AECOM became the margin-and-capital-return version of the global design consultancy. It is larger than Tetra Tech in gross and net service revenue, has a more global public-infrastructure portfolio and has prioritized internal margin gains and repurchases over large new acquisitions.

Jacobs took the growth-and-portfolio-upgrade route. Its infrastructure and advanced-facilities franchise has greater exposure to data centers, semiconductor facilities, energy and high-value consulting. Jacobs completed the remaining acquisition of PA Consulting in March 2026 for approximately $1.6 billion, adding a faster-growing, higher-intellectual-property consulting platform but also integration and acquisition risk. Fiscal second-quarter adjusted net revenue grew 8.8%, backlog increased 21.7% to $27.0 billion and adjusted EPS rose 22.4%.

Tetra Tech is the focused water, environment and government-consulting compounder. Fiscal second-quarter 2026 net revenue was $1.05 billion, adjusted EBITDA was $146 million, backlog was $4.28 billion and days sales outstanding was 58. Its net revenue grew 8% excluding discontinued U.S. aid and disaster activity, and its EBITDA margin expanded 90 basis points. Customers choose Tetra Tech for specialized environmental and water capability; investors pay for consistent organic growth, acquisitions and stronger working-capital performance.

Parsons runs a hybrid of critical infrastructure and national-security technology. That mix can produce higher growth but also greater program concentration and execution volatility. Its fiscal second-quarter 2026 revenue fell 1%, or 5% organically, although excluding a confidential contract and portfolio actions, revenue grew 8% and organic revenue grew 3%. A joint-venture program and planned divestitures caused $118 million of charges; adjusted EBITDA margin was 2.7% as reported but 10.1% excluding the charges. The quarter is a useful reminder that infrastructure programs can produce sudden losses even at firms with strong backlog.

Leidos is more a valuation boundary than a direct operating peer. It sells technology, engineering and mission services primarily to U.S. government customers. Fiscal second-quarter 2026 revenue was $4.3 billion and adjusted EBITDA was $647 million, a margin around 15%. Its lower valuation reflects government concentration, contract mix and defense-budget considerations rather than a judgment about global design consulting.

† Parsons figures exclude the confidential-contract effect, portfolio actions and the $118 million of program-related charges where indicated. Market values use July 31 closing data. Peer margins are normalized to the revenue definition each company emphasizes and are still not perfectly comparable.

The table reverses one common assumption. AECOM does not have the lowest service margin. Its latest enterprise margin on NSR exceeds Jacobs’ latest adjusted EBITDA margin on adjusted net revenue and Tetra Tech’s EBITDA margin on net revenue. The valuation discount reflects growth, cash reliability and perceived quality of the margin, rather than simply the current percentage.

Jacobs deserves a premium because its adjusted net revenue grew more than four times as fast at constant currency in the latest quarter, its backlog grew 22%, and PA Consulting gives it exposure to higher-growth strategic consulting. That premium also prices successful acquisition integration and continued advanced-facilities spending. AECOM would narrow the gap by producing 5% or higher NSR growth without sacrificing margin or cash.

Tetra Tech earns its premium on specialized water and environmental exposure, 58-day DSO and a record of using acquisitions to expand while maintaining cash generation. AECOM’s 83-day DSO and fiscal 2026 collection claims explain part of its discount. AECOM has greater scale and broader program-management capacity, but Tetra Tech’s working-capital discipline presently looks stronger.

Parsons illustrates why AECOM should not be valued solely on backlog. It had maintained a trailing book-to-bill ratio at or above 1 since its 2019 IPO, yet one joint-venture issue produced a major quarterly charge. AECOM’s exit from self-perform construction lowered this type of risk; its 25% fixed-price and 37% guaranteed-maximum-price gross-revenue mix means it did not eliminate it.

WSP Global, Stantec and Arcadis occupy a different capital-allocation niche. They use recurring acquisitions more actively to add geography and technical capability. Their net-revenue reporting also makes headline sales smaller and margins appear cleaner than gross-revenue reporters. AECOM’s recent model relies more heavily on internal operating improvement and repurchases. The trade-off is lower integration risk but less acquisition-driven growth.

Amentum is the successor to the Management Services business AECOM sold in 2020. It is relevant both as a government-services peer and as the owner of the former affiliate involved in the DOE matter. The sale agreement left AECOM with 90% of the economic exposure to that claim, which means the corporate separation did not create complete economic separation.

The evidence supports a real but partly justified valuation gap. AECOM’s latest margin is competitive and its balance sheet is not highly levered. Its organic growth is slower, current cash conversion is weaker, the low tax rate amplified EPS, and legacy claims remain. The market is assigning less value to each adjusted dollar because the latest adjusted dollar did not pass through to cash.

The discount becomes excessive only when three conditions hold simultaneously: contracted backlog grows, DSO returns toward the mid-70s and normalized free cash flow exceeds $600 million. At that point, a 12-times adjusted P/E would no longer reflect the financial quality of the business. Before that proof, the discount is an evidence-based risk adjustment.

The last four reported quarters show a business progressing operationally but becoming less clean financially. Fiscal third and fourth-quarter 2025 delivered record margins, rising earnings and strong full-year cash conversion. Fiscal first-quarter 2026 produced 6% constant-currency NSR growth as reported, or 9% adjusted for three fewer working days in the Americas, while segment margin increased 100 basis points. Fiscal second-quarter NSR growth slowed to 2% constant currency, while the tax rate and buybacks drove unusually fast EPS growth.

† First-quarter Americas NSR growth was 9% after adjusting for three fewer workdays. ‡ Management said first-quarter adjusted EPS grew 8% after normalizing the unusually low prior-year tax rate. § Derived from first-half FCF of about $15 million less first-quarter FCF of $42 million.

Management raised fiscal 2026 adjusted-EPS guidance to $5.90 to $6.10 and adjusted-EBITDA guidance to $1.275 to $1.305 billion. The midpoint implies about 14% adjusted-EPS growth and 7% EBITDA growth. Guidance also calls for approximately $400 million of free cash flow, a 20%–22% tax rate and an average diluted share count of 130 million before additional repurchases.

The guidance bridge reinforces the central concern. EPS growth is expected to run twice as fast as EBITDA growth. Part of the difference is lower shares; part is tax. Free cash flow of $400 million would be about 31% of adjusted EBITDA and well below fiscal 2025 FCF. Management expects claims and working capital to reverse, but even full-year guidance implies a weaker cash year.

Gross revenue’s 1% second-quarter growth also understates the business slightly. Net service revenue increased 4% as reported, and Americas design grew 8%. Lower-pass-through construction-management activity depresses gross growth without necessarily hurting profit. Yet constant-currency enterprise NSR grew only 2%, so revenue quality does not fully explain the gap with 27% EPS growth.

The strongest business line is Americas design. Transportation, water and environment drove an 8% NSR increase, and margin reached 20%. This segment combines U.S. infrastructure funding, local public budgets and a large installed client base. It is the foundation for the bull case.

International is the swing factor. It has much lower margin, faster backlog growth and more geographic volatility. Fiscal second-quarter NSR fell 3%, while backlog increased 25%. If new United Kingdom, Australian and Middle Eastern awards mobilize, International can produce both volume and mix upside. If funding or conflict delays work, the backlog will remain a long-duration promise and receivables may stay elevated.

The construction-management review ended with AECOM deciding to retain the business. This avoids a forced sale and preserves access to major building and transit programs. It also means the company’s “pure-play” claim should be interpreted as pure-play professional services, not zero construction-project exposure. Construction management contributes pass-through revenue, guaranteed-maximum-price risk and lower revenue comparability.

The market is primarily trading the durability of margin expansion and the credibility of cash conversion. Backlog and public spending are supporting narratives, but the stock’s low multiple says investors do not yet assume that backlog will produce peer-like top-line growth. The next results are likely to be judged less on whether adjusted EPS beats by a few cents and more on DSO, Middle East collections, free-cash-flow guidance and contracted backlog.

The bull case is supported by record backlog, a 1.2 design book-to-burn ratio, 22 quarters above 1, an 8% Americas design growth rate, substantial unspent public infrastructure funding and a 20% Americas margin. AECOM can generate double-digit EPS growth with mid-single-digit NSR growth if International margin improves and shares continue declining.

The bear case is supported by only 2% constant-currency NSR growth, a Q2 tax rate that supplied much of the EPS increase, first-half FCF near zero, 83-day DSO, almost half of backlog not yet contracted and continuing legacy charges. A professional-services business cannot indefinitely compensate for low volume with margin and financial engineering.

Valuation, risks and catalysts

AECOM’s current price of $72.39 produces three very different valuation readings. Trailing GAAP EPS of $3.52 implies a 20.6-times P/E. Fiscal 2026 adjusted-EPS guidance of $5.90 to $6.10 implies 11.9–12.3 times, or 12.1 times at the midpoint. Guided FCF of $400 million implies a 4.2% equity FCF yield and approximately 23.9 times FCF.

The disparity between 12.1 times adjusted earnings and 23.9 times current-year free cash flow exceeds 30%, so owner earnings should take priority over adjusted EPS in the valuation. Fiscal 2026 cash is depressed by working capital and may recover, but a valuation cannot assume recovery before it occurs.

Fiscal 2025 offers the normalized upper reference. FCF of $685 million implies a 7.2% yield on the July 31 market capitalization. Total capex was about $137 million. Treating 80%–100% as maintenance produces owner earnings of roughly $685 million to $712 million, equivalent to 13.4–14.0 times owner earnings. That is inexpensive for a business capable of mid-single-digit NSR growth, but merely fair for one with flat revenue, periodic claims and no further margin expansion.

Enterprise value is approximately $11.27 billion, consisting of $9.55 billion of equity value and $1.71 billion of net debt. Against the $1.29 billion midpoint of adjusted-EBITDA guidance, EV/EBITDA is approximately 8.7 times. Pension and contingent guarantees add risk but are not treated as funded debt in this calculation.

AECOM’s current adjusted P/E is well below Jacobs and Tetra Tech. Jacobs trades at approximately 19 times the midpoint of fiscal 2026 adjusted-EPS guidance, while Tetra Tech trades around 21.5 times. Leidos’ trailing P/E is around 10.6 times, showing that government-related service companies can remain inexpensive where growth or customer concentration concerns persist.

A reliable historical percentile cannot be established from the company’s primary filings, and I do not assign a false level of precision using unsourced third-party time series. The current 12.1-times forward adjusted multiple is plainly at the low end of the current design-consultancy peer range. Whether it is below AECOM’s long-run normal depends on whether pre-2020 conglomerate years, with materially different portfolio risk, should be included.

The valuation scenarios below use owner earnings as the primary method and adjusted P/E and EV/EBITDA as cross-checks. They are research scenarios, not investment advice.

† Includes an approximate modest dividend contribution and assumes the terminal prices shown. Calculations use the $72.39 close on July 31, 2026. The wide multiple range reflects uncertainty about cash normalization.

The conservative case assumes backlog does not translate into meaningful volume, International remains weak and the margin target stalls. The business still generates cash, but shareholders receive little benefit from multiple expansion. Permanent loss becomes likely if working-capital problems prove structural rather than timing-related.

The base case assumes current awards move into contracted backlog, NSR returns to a 4%–5% rate and International begins closing part of its margin gap. Owner earnings recover toward fiscal 2025 levels despite higher taxes. A 15–18 times owner-earnings multiple remains below the premium accorded to the faster-growing consultancies.

The optimistic case requires most of management’s strategy to work: a 20% exit margin, sustained book-to-burn, faster advisory growth, AI productivity sharing, healthy public appropriations and strong cash conversion. It also requires the market to believe those gains are durable rather than the endpoint of a restructuring cycle.

The most fragile base-case assumption is normalized owner earnings of $625 million to $675 million. Reducing that assumption to 70% gives $438 million to $473 million. At the same 15–18 times multiple and 125 million shares, the implied equity value falls to approximately $53 to $68 per share. That range is below the current price across its entire span.

A flat-earnings test is less favorable. If adjusted EPS remains $6.00 for three years and AECOM exits at the present 12.1-times multiple, the share price is essentially unchanged before dividends. The return would be limited to a low-single-digit dividend yield, below a conservative 4% government-bond hurdle. Under that flat-earnings case, there is no margin of safety at this buy price.

The conservative fair value of $60 to $68 is below or close to the current price. The current price offers no discount to the conservative scenario. It trades near the lower boundary of the base valuation and depends on cash recovery rather than providing protection against its absence.

Margin-of-safety sufficiency verdict: not obvious. AECOM is not priced for peer-like growth, but the adjusted P/E overstates cheapness because fiscal 2026 owner earnings trail adjusted earnings. A wider discount is appropriate until DSO and free cash flow normalize.

The principal permanent-loss risk is working-capital deterioration: medium probability, high impact. The observable indicators are DSO, contract assets, Middle Eastern claim collections and FCF conversion. If DSO remains above 85 days and FCF remains below $400 million, buybacks would either slow or require additional debt. EPS growth would decline while the market would apply a lower-quality earnings multiple.

Second comes failure to convert backlog, also medium probability and high impact. The indicators are contracted-backlog growth, notices to proceed and NSR growth. Awarded backlog already represents 47% of total backlog, and its growth is materially faster than contracted backlog. Appropriation delays, project redesign or Middle Eastern spending pauses could leave book-to-burn healthy while revenue remains near 1%–2%.

Third, margin exhaustion, again medium probability and high impact. The indicators are Americas design margin, International margin, utilization, wage inflation and restructuring charges. Americas is already at 20%. If International stays near 11% and wage competition increases, the 20% enterprise exit target would require an aggressive mix shift. The multiple could contract even if absolute earnings remain stable because the market’s long-term EPS expectations would reset.

Fourth is project and claim loss, where probability is low to medium but impact can be high. The contract mix includes fixed-price and guaranteed-maximum-price work, while the former businesses continue to generate legacy adjustments. The observable indicators are new provisions, discontinued-operation losses, contract-asset growth and changes in guarantees. A single large project can absorb several quarters of incremental margin.

The last risk is public-budget disruption, medium probability with medium-to-high impact. Half of revenue comes from government clients, and some private or quasi-public projects also depend on regulated spending. A federal appropriations change would delay state and local awards before reducing recognized revenue. A Middle Eastern pause would hit International backlog conversion and collections. Geographic diversification reduces the probability that every market weakens together, but it does not remove policy sensitivity.

FX risk is lower than the operating risks but can distort reported momentum. Fiscal second-quarter translation added roughly two percentage points to reported NSR growth. A stronger dollar could reverse that benefit and reduce the reported value of International backlog without materially changing local project economics.

Valuation compression is not the primary concern at 12.1 times adjusted earnings. Earnings-quality disappointment is. A fall from $6.00 adjusted EPS to $4.50 combined with a 10-times multiple would produce a $45 share price, a decline of about 38%. A larger project charge or debt-funded capital return could create a loss approaching 50%.

Positive catalysts over the next 12 months include collection of Middle Eastern claims, DSO returning below 78 days, maintained $400 million FCF guidance, contracted-backlog growth accelerating above 5%, International NSR returning to growth and fiscal 2027 guidance showing that EPS growth can continue with a normalized tax rate.

Longer-term catalysts include International margin moving into the low-to-mid teens, advisory NSR doubling on management’s three-year timetable, AI gain-sharing becoming visible in margins, and successful conversion of U.S., U.K. and Australian public programs. These would shift the valuation basis from restructuring to organic compounding.

Negative catalysts include a reduction in FCF guidance, DSO above 85, a new legacy or fixed-price charge, design book-to-burn below 1, cancellation of a large International award, or fiscal 2027 guidance requiring another unusually low tax rate to produce double-digit EPS growth.

The indicators should be read together. A high book-to-burn with rising awarded backlog but no contracted growth would signal slow conversion. Margin expansion with DSO above 85 would signal that accounting profit is not becoming cash. A temporary DSO increase is acceptable if collections appear in the next quarter; repeated explanations would change the interpretation.

Cross-synthesis and final research conclusion

Looking vertically, AECOM has proven that it can remake the economic profile of a century-old federation of engineering businesses. It sold a valuable government-services unit, removed most self-perform construction, exited lower-return geographies, centralized parts of delivery, raised margins and repurchased a large portion of its equity. This was more than a cyclical recovery. Segment margins moved from 12.3% in fiscal 2020 to 16.5% in the latest first half, while Americas design reached 20%. The company generated more than $3 billion of cumulative shareholder returns after September 2020.

The capability that history demonstrates is disciplined portfolio and cost management. AECOM has also kept client demand high, with design book-to-burn above 1 for 22 consecutive quarters. The evidence for sustained organic growth is weaker. Net service revenue compounded around 4% from fiscal 2020 to fiscal 2025, while adjusted EPS grew much faster. The past five years were primarily a margin, mix and capital-allocation story.

Those success factors still exist, but they are at different stages of maturity. The elimination of self-perform construction is permanent. Global delivery, pursuit selection and advisory investment can keep producing incremental gains. Real-estate rationalization, country exits and the initial post-divestiture mix step cannot be repeated indefinitely. Buybacks can continue only at the rate permitted by free cash flow and prudent leverage.

Looking horizontally, AECOM’s real advantage is scale across major public-infrastructure categories combined with a competitive current margin. It can assemble multidisciplinary teams for transportation, water, environmental and building programs across several continents. Its Americas franchise appears especially strong, with 8% design growth and a 20% margin in fiscal second-quarter 2026.

Its weakness relative to Jacobs and Tetra Tech is growth quality. Jacobs’ adjusted net revenue grew 8.8%, and Tetra Tech’s adjusted underlying net revenue grew 8%, compared with AECOM’s 2% constant-currency NSR growth. Tetra Tech’s 58-day DSO also compares favorably with AECOM’s 83. These are structural differences until AECOM proves otherwise, even if part of the latest quarter reflects timing.

The current valuation does not pre-spend management’s entire long-term plan. At 12.1 times fiscal 2026 adjusted EPS, the market discounts AECOM heavily to the design-consultancy leaders. It does pre-spend a cash recovery that has not yet appeared. On guided fiscal 2026 FCF, the stock yields only 4.2%. The valuation is cheap on adjusted earnings, fair on normalized fiscal 2025 owner earnings and unattractive on current-year cash.

The market is most likely misjudging one of two variables. It may be underestimating the durability of AECOM’s higher margins and the value of its public-infrastructure backlog. If $26.2 billion of backlog converts into 4%–6% NSR growth, the current multiple is too low. Alternatively, the market may be correctly identifying that adjusted EPS has moved too far ahead of volume and cash. The August cash result will help distinguish the two.

The next 12 months depend on collections, contracted backlog and the fiscal 2027 guide. The three-year outcome turns on whether International can grow and raise margin, allowing the enterprise to approach a 20% exit rate without repeated restructuring. Over five years, the question is whether AECOM becomes an organic professional-services compounder or settles into a mature infrastructure consultant that produces mid-single-digit revenue growth and returns most cash.

A better investment setup would combine a price in the high-$40s to low-$50s with unchanged backlog, or the current price with hard evidence of normalized cash generation above $600 million, DSO below 78 and 4%–6% NSR growth. The thesis should be overturned if backlog remains high but NSR stays below 2% for several quarters, if DSO remains above 85, or if the 20% margin target requires recurring exclusions and underinvestment in talent.

Core bull reasons

• Design backlog reached $24.66 billion and design book-to-burn was 1.2, extending the above-1 sequence to 22 quarters.
• Americas design NSR increased 8% and Americas adjusted margin reached 20%, showing that meaningful organic growth and high margins can coexist in the core franchise.
• Government infrastructure programs remain large and multi-year, including remaining U.S. IIJA resources, the U.K.’s £104 billion water program and Australia’s A$242 billion major-project pipeline.
• Fiscal 2020–2025 average FCF conversion exceeded 100%, supporting the view that fiscal 2026 weakness could be temporary.
• The stock trades at approximately 12.1 times fiscal 2026 adjusted-EPS guidance, materially below Jacobs and Tetra Tech.

Core bear reasons

• Fiscal second-quarter constant-currency NSR increased only 2%, while adjusted EPS increased 27%, with the tax rate and share count supplying a large portion of the difference.
• Contracted backlog increased only about 4%, while awarded backlog increased 13% and represents 47% of total backlog.
• First-half fiscal 2026 FCF was about $15 million while repurchases and dividends exceeded $500 million, causing cash to fall and leverage to rise.
• Days sales outstanding increased to 83, and receivables plus contract assets absorbed $347 million of cash.
• Former construction and Management Services businesses still generate discontinued losses, claim uncertainty and contingent obligations.

Pre-mortem

The first plausible 50% loss script begins in fiscal 2027. Federal appropriations and Middle Eastern project authorizations slow, awarded backlog remains unsigned and enterprise NSR growth falls to zero. Jacobs and Tetra Tech continue hiring aggressively in water and advanced facilities, forcing AECOM to increase compensation while utilization declines. Americas margin falls from 20% to 17%, International remains near 10%, and enterprise segment margin falls to 14.5%. Adjusted EPS declines to $4.50. At a 10-times multiple, the shares trade at $45, before any additional claim charge.

The second script is a cash and credibility failure. Middle Eastern collections remain delayed, DSO exceeds 90 days through fiscal 2027 and FCF stays below $300 million. A new fixed-price or legacy adjustment consumes $150 million to $250 million, while repurchases have already raised net leverage above 2 times. The board slows capital returns, and adjusted EPS falls to $4.00 after the tax rate normalizes. A 9–10 times multiple produces a $36 to $40 share price, close to a 50% decline from the research-base price.

AECOM is a better company than its low adjusted multiple alone suggests, and a less clean investment than the record backlog alone suggests. Its transformation created a high-margin professional-services franchise, especially in Americas design. The next leg requires revenue and cash, not another presentation of adjusted margin. At the present price, investors are being paid to accept slower growth than Jacobs and Tetra Tech, but not being fully compensated for a conservative scenario in which working capital remains weak.

The decisive issue is cash conversion. A fiscal third-quarter collection recovery, DSO moving back toward the mid-70s and maintained full-year FCF guidance would materially strengthen the investment case. Another quarter of explanations, continued debt-funded repurchases or weak contracted-backlog growth would make the apparent P/E discount largely justified.

Company-profile scores

• Fundamental quality: medium
• Growth: medium
• Moat: medium
• Financial soundness: medium
• Management credibility: high
• Valuation attractiveness: medium
• Risk level: medium
• Suitable investor type: value-oriented investors prepared to monitor working capital and public-infrastructure funding

Investment rating

• Rating: Hold
• One-line thesis: A competitive 16.5% service margin and low adjusted P/E are offset by weak cash conversion and tax-supported EPS growth.
• Current-price classification: acceptable hold
• Whether to wait for a better price: yes; a purchase becomes more attractive at $48 to $52 with intact backlog, or after DSO falls below 78 and normalized FCF exceeds $600 million.
• Opportunity cost of waiting: a rapid collection recovery and successful fiscal 2027 guide could re-rate the shares before a lower price appears.
• Target holding horizon: three to five years
• Expected annualized return: conservative about -2%; base about 8%; optimistic about 20%
• Max-loss risk: approximately 45%–50% if NSR stagnates, segment margin falls toward 14%–15%, FCF remains below $300 million and the multiple compresses to 9–10 times.
• Reassessment triggers: DSO above 85 for two consecutive quarters; design book-to-burn below 1 for two quarters; contracted backlog growth at or below zero; segment margin below 16%; net leverage above 2 times.

【Ideal Buy Price】48–52 USD

This range is roughly 20% below the $60 to $68 conservative scenario and provides protection against incomplete cash normalization.

The acceptable hold range is $72 to $96, centered on the base owner-earnings scenario. A price of $130 or more would sit above the optimistic fair value of $112 to $128 and would require evidence beyond the assumptions used here.

【Valuation Range】

• current: 72.39 (close as of 2026-07-31)
• bear (conservative · ideal buy zone): [48, 52]
• base (fair · acceptable hold zone): [72, 96]
• bull (optimistic · above the clearly-overvalued line): [130, 145]

The principal research uncertainties are the absence of disclosed backlog margins, no clean maintenance-versus-growth capex split, limited end-market revenue disclosure, uncertain timing of awarded-but-uncontracted work and the imminent fiscal third-quarter release. These blind spots prevent a higher-conviction rating.

The primary source base consists of AECOM’s fiscal 2025 10-K, fiscal second-quarter 2026 10-Q and earnings materials, fiscal 2026 proxy statement, management’s fiscal second-quarter call, peer quarterly releases and government infrastructure-funding disclosures.

Other tickers mentioned

• J.US: closest U.S. global design and program-management peer, with faster adjusted net-revenue growth and PA Consulting exposure
• PSN.US: infrastructure and national-security peer illustrating project and joint-venture charge risk
• LDOS.US: government technology and engineering valuation reference with a different customer mix
• TTEK.US: higher-growth water and environmental consultancy with stronger current working-capital metrics
• AMTM.US: successor to AECOM’s former Management Services business and a government-services comparison
• WSP.TO: global design-consultancy consolidator used as an international strategic reference
• STN.TO: North American infrastructure and environmental consulting peer
• ARCAD.AS: European design and engineering consultancy with net-revenue reporting

This report is based on public information and does not constitute investment advice. Markets carry risk; invest with caution.