AECOM (ACM) Stock Analysis
AECOM
How to read ACM
A profitable, cash-generating business — our discounted-cash-flow estimate is the primary lens, cross-checked against what growth the price implies and against peers.
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1
The verdict + intrinsic value (our DCF) ↓
Our estimate of what a share is worth, versus today's price.
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2
Reverse-DCF + the interactive calculator ↓
See the growth the price assumes, then flex every assumption yourself to pressure-test it.
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Football field + peers ↓
A cross-check across methods and against comparable companies.
Is now a good time to buy ACM?
Macro: Neutral / mid-cycle
ACM trades at $68.05 vs an estimated
intrinsic value
of $91.13
— a -25.3%
discount.
To justify today's price, the market needs ACM to grow per-share value around
3.2% per year for the next 5 years (this is the
price-implied growth rate).
Our DCF projects
modeled growth
of 8.1% per year based on history + sector defaults
(analyst consensus estimates not yet integrated).
Note: this is a 5-year, per-share view. The Reverse-DCF section below asks the same question on a stricter 10-year free-cash-flowFree Cash Flow (FCF) — Operating cash flow minus capital spending: cash left after a company covers operating costs, taxes and interest and reinvests in the business — but BEFORE repaying debt principal or paying dividends. The cash actually available to investors.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → basis — so its growth number is different, not contradictory.
Not investment advice. The model can be wrong. Verify the assumptions in the sections below and consider consulting a licensed advisor for significant decisions.
What growth must the market believe? Reverse DCF — Instead of asking "what is this stock worth?", asks "what growth rate is the current market price already assuming?"
Why it matters: It crystallizes the bull thesis as a single number you can argue with. If the market expects 40% growth for 10 years and you do not believe that, the stock is overvalued.
Reference: 10–15% = sustainable for strong companies · 20–25% = exceptional · 30%+ = historically very rare
Traditional DCF asks "what is this stock worth?" Reverse DCF flips it: it treats today's price as correct and solves for the growth rate that justifies it. In plain terms — if our model is right about everything else, the company's cash flow would have to grow (or shrink) by this much every year for the next 10 years for today's price to make sense. If that required growth looks unrealistic, the price is stretched; if it looks easy to beat, the price may be cheap.
Why it matters: A company can show big profits on paper while burning through cash. FCF is what actually fills the bank account.
Reference: Healthy mature businesses convert 8–15% of revenue into FCF · Growth companies often negative
Full explanation → must grow at:
Almost any healthy business should clear this bar. Likely undervalued unless something serious is wrong.
For reference: A low bar — most financially healthy companies clear this comfortably.
▾ How we computed this · Reality check thresholds · Assumptions
- Starting FCF/share: $4.68 (TTM)
- Discount RateDiscount Rate — The annual return you demand for taking single-stock risk instead of buying a safe Treasury or index fund.
Why it matters: Higher discount rate = stricter valuation (a stock has to produce more cash to be worth holding). Lower = more generous.
Reference: 8–12% is standard · 9–10% matches S&P 500 historical return · Below 7% is illogical for single-stock risk
Full explanation →: 9.9% — standard 8-12%; 9-10% matches S&P 500 historical return - Terminal Growth RateTerminal Growth Rate — The growth rate we assume the company holds forever, after the explicit 10-year forecast period ends.
Why it matters: It anchors the long-tail value. Cannot mathematically exceed long-term GDP growth or the company eventually becomes larger than the global economy.
Reference: 2–3% (matches long-term US GDP growth) · Above 4% is mathematically problematic
Full explanation →: 3.0% — matches long-term GDP growth - Forecast horizon: 10 years explicit + terminal perpetuity
| ≤ 0% | Priced for decline — likely undervalued OR dying business |
| 5-12% | Reasonable; sustainable for quality businesses |
| 12-18% | Demanding — strong execution required |
| 18-25% | Exceptional — few companies sustain for a decade |
| 25-35% | Heroic — historically very rare |
| 35%+ | Borderline impossible at scale |
In the last 25 years, fewer than 5 large US-listed companies have compounded FCF at 30%+ for 10 straight years. The bar is brutally high.
Interactive sliders to tweak discount rate / terminal growth coming in Phase H.2.
Football field: where does the price sit?
Different valuation methods produce different fair-value ranges depending on assumptions. Plotting them together lets you see at a glance whether the current price is reasonable across approaches, or only one specific lens.
Industry multiples sourced from: sector: Industrials. See Peer Basket section below for tight comparables.
How does ACM stack up against its closest peers?
We take the 8 companies most similar to ACM (same industry, similar size) and check what investors are paying for each dollar of their revenue (or profits). If ACM is much more expensive on the same yardstick, that's a red flag — unless you have a specific reason it deserves a premium.
▾ What's "EV / Sales" in plain English?
EV (Enterprise Value) = market cap + total debt − cash. It's "what you'd pay to buy the entire company outright" — you pay the market cap to shareholders and take over their debt, but you keep their cash. EV is fairer than market cap alone because it includes the debt the new owner inherits.
EV / Sales = EV ÷ annual revenue. So "2.5×" means investors pay $2.50 of enterprise value per $1 of yearly sales. Higher = market is paying more per dollar of sales (usually because they expect future growth or fat margins).
p25 / median / p75 are the 25th, 50th (middle), and 75th percentile of the peers' multiples. Half the peers fall between p25 and p75. The median (p50) is the typical peer — that's the benchmark we compare to.
| EV / SalesEV / Sales — For every $1 of yearly revenue, this is how many dollars investors pay to own the whole business (including debt). Why it matters: Works for pre-profit growth companies where P/E and FCF don't apply. The most apples-to-apples cross-company multiple because it ignores accounting choices. Reference: 1–3x for mature companies · 4–10x for software/SaaS · 10–20x for hypergrowth · >20x is rare and demanding Full explanation → |
1.8x / 2.7x / 4.9x |
| EV / Gross ProfitEV / Gross Profit — Enterprise value divided by gross profit — the multiple paid for what each dollar of sales contributes after direct costs. Why it matters: More refined than EV/Sales for high-margin businesses (software, marketplaces) where gross margin is the real economic engine. Reference: 8–15x for SaaS · 15–25x for hypergrowth software · >30x demanding Full explanation → |
8.2x / 8.7x / 8.8x |
| EV / EBITDAEV / EBITDA — Enterprise value divided by earnings before interest, tax, depreciation, and amortization. Why it matters: A classic "what would a private buyer pay" multiple — used in M&A. Strips out tax and capital-structure noise. Reference: 8–12x for mature businesses · 15–25x for growth · Below 5x often signals distress Full explanation → |
19.3x / 23.5x / 29.9x |
Bold middle number = median peer. Half the peers trade above it, half below.
⚠️ Important caveat: peer multiples only work if the peers are genuinely comparable. Always check the peer list below — if the auto-picker grabbed micro-caps or unrelated businesses, the comparison is noise. A medical-device giant priced against tiny biotech startups won't produce a useful signal.
▾ View peer list (8)
| Ticker | Company | Mcap | EV/Sales | EV/GP | EV/EBITDA | FCF Yield |
|---|---|---|---|---|---|---|
| STN | STANTEC INC | $8.6B | — | — | — | — |
| TTEK | TETRA TECH INC | $7.1B | 1.5x | 8.2x | 19.3x | 5.5% |
| TTC | TORO CO | $8.7B | 2.1x | 6.4x | 23.5x | 6.2% |
| VSEC | VSE CORP | $5.2B | 4.9x | — | 61.2x | 3.4% |
| VMI | VALMONT INDUSTRIES INC | $10.1B | 2.7x | 8.8x | 26.2x | 2.8% |
| ZWS | Zurn Elkay Water Solutions Corp | $7.8B | 4.9x | 10.9x | 29.9x | 3.8% |
| WTS | WATTS WATER TECHNOLOGIES INC | $10.4B | 4.3x | 8.7x | 23.5x | 3.2% |
| WFRD | Weatherford International plc | $7.5B | 1.8x | — | 11.7x | 5.5% |
Bankruptcy + quality screens
Cheap stocks can be cheap for a reason. These two industry-standard scores warn when low valuation comes paired with structural fragility.
Why it matters: Cheap-looking stocks (low P/E or P/B) often have low Z-scores because the market knows the company is dying. Z-score warns you before you fall into a value trap.
Reference: > 3.0 = safe zone · 1.81–3.0 = grey zone · < 1.81 = distress zone
Full explanation →
Moderate stress signals. Bankruptcy risk over 2 years is meaningful (~25-40%) — verify recent trend before betting on a turnaround.
Most predictive for manufacturing companies. Less reliable for banks, REITs, insurance, and pre-profit growth companies.
Why it matters: High score = fundamentals improving. Low score = deteriorating. Especially powerful for filtering cheap stocks: cheap + high F-score historically outperforms; cheap + low F-score is often a value trap.
Reference: 7–9 = strong · 4–6 = mediocre · 0–3 = weak
Full explanation →
▾ The 9 checks — what passed, what didn't, and why it matters
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✓ Positive net incomeNet income $561.8M in the latest year.
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✓ Positive operating cash flowOperating cash flow $821.6M (was $827.5M the prior year).
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✓ Cash flow backs up reported profitOperating cash flow $821.6M vs net income $561.8M.
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✓ Return on assets improvingReturn on assets 4.6% vs 3.3% a year ago.
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✓ Debt load shrinking (not rising)Long-term debt is 0.0% of assets vs 0.0% a year ago ($0.0M now).
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✓ Short-term liquidity improvingCurrent ratio 1.14x vs 1.11x a year ago.
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✓ Not diluting shareholdersShare-count history limited.
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✓ Pricing power improving (gross margin)Gross margin 7.5% vs 6.7% a year ago.
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✗ Getting more sales per assetAsset turnover 1.32x vs 1.34x a year ago.Why this matters: Asset turnover measures how much revenue each dollar of assets generates. Rising = more productive use of the asset base.
Each ✗ is a fundamental concern the market may be reacting to. Compared year-over-year against the company's own prior year.
What if you assume different inputs?
Here's where we land — and what happens if you change the assumptions. Drag the sliders to set your own Discount RateDiscount Rate — The annual return you demand for taking single-stock risk instead of buying a safe Treasury or index fund.
Why it matters: Higher discount rate = stricter valuation (a stock has to produce more cash to be worth holding). Lower = more generous.
Reference: 8–12% is standard · 9–10% matches S&P 500 historical return · Below 7% is illogical for single-stock risk
Full explanation → (the annual return you demand for single-stock risk) and terminal growth; the value updates live so you can see whether the stock looks cheaper or richer. The discount rate starts at 10.0%, the figure our model used for ACM. Open Advanced to also change beta, growth and the rate path.
9.9% — beta-based (CAPM), from this stock's BetaBeta — How much the stock moves when the overall market moves. 1.0 = moves with the market; 1.5 = moves 50% more than the market.
Why it matters: Higher beta = more volatile = should demand higher discount rate. Low beta stocks (utilities, consumer staples) move less.
Reference: Most stocks 0.5–1.5 · Defensives ~0.3 · High-vol tech ~1.5–2.0
Full explanation → of 0.98. The safe Treasury rate plus a premium scaled by how much more (or less) volatile the stock is than the market. This is the slider's starting point.
9.5% — sector/quality tier. A simpler hurdle set by industry and business durability: lower for stable, wide-moat companies; higher for speculative or micro-caps.
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⚙ Advanced — tinker with every input (beta, growth, rate path, margin → full intrinsic value)
AECOM appears undervalued by 23.9% according to the model, which suggests a fair value of $91.13 against the current price of $69.37. The market is likely discounting the stock due to rising long-term debt, which has increased from $54M to $66M. The primary quantifiable risk is the continued increase in long-term debt.
As of May 30, 2026
Anatomy of a share
What you're buying per share. Bars are at the same scale so you can see the relative size of revenue, costs, cash flow, and debt — not just read them in a table.
What's free cash flow / what do these mean?
Revenue per share — how much the business earns from customers, divided by the number of shares outstanding. Top of the income statement.
Profit per share (EPS) — what's left after operating costs, interest, and taxes. This is the "earnings" in "price-to-earnings."
Free cash flow per share — actual cash the business produces after maintaining/growing its assets (operating cash flow minus capital expenditures). FCF is what funds dividends, buybacks, debt repayment, and acquisitions. A company can report positive earnings and have negative FCF (e.g., when "earnings" rely on non-cash items like depreciation).
Debt per share — total interest-bearing borrowings divided by shares. High debt-per-share next to thin FCF-per-share is a fragility signal.
What you actually need to decide
Every stock price is a disagreement. Here's the single thing that must go right for the bulls, the single thing that breaks the thesis, and the concrete signposts to watch so you can update your view as real results arrive.
- Check for stabilization or reduction in long-term debt in next filings
- Monitor trends in operating cash flow growth
- Observe any changes in gross margin expansion
The trend, in plain numbers (2024 → 2025)
Straight from the financial statements — no model, no opinion. For a small or unprofitable company, the direction of these numbers usually tells you more than any single valuation.
- Gross margin improved to 8% (+1 pts).
- Net income grew +40% to $561.8M.
- Free cash flow fell to $684.9M.
Roughly flat: Revenue was flat +0% to $16.14B.
Management & Leadership
AECOM is led by CEO Troy Rudd, who assumed the role in 2020. He has been with the company for many years, previously serving as Chief Financial Officer. The company is a global leader in infrastructure consulting.
What They Make
AECOM provides professional technical and management support services for infrastructure projects worldwide, serving government, commercial, and industrial clients.
End Markets
Revenue Drivers
Why Is It Priced Like This?
Why Customers Pay
The market prices AECOM at a 23.9% discount, likely reflecting concerns over its rising long-term debt, which has increased from $54M to $66M. While revenue is growing at 4.9%/yr and operating cash flow is positive, the increasing debt load may be a key factor in the market's cautious valuation.
Three Scenarios, Weighted
| Scenario | IV | vs Price | Weight |
|---|---|---|---|
| Conservative | $78.45 | 15.3% | 40% |
| Base | $92.65 | 36.1% | 35% |
| Optimistic | $109.27 | 60.6% | 25% |
| Weighted | $91.13 | 33.9% | 100% |
What has to be true (historical comparison)
To justify today's price, ACM needs to grow revenue roughly 1.2× over 5 years. Each card below is a real company that grew at a comparable magnitude: the green/amber line shows whether it cleared or fell short of the bar ACM now needs, and the tag on the right shows how that company actually fared afterward (succeeded, faded, or wiped out). This is about the magnitude required and its historical base rate, not pattern-matching — the next great compounder won't look exactly like any of these.
What 'scale' looked like in 1999 for comparison purposes. Big and profitable. Revenue actually declined over the next 20 years.
$6B revenue, modestly profitable. Two years before iPod. Best-known case of a stagnating business that pivoted into platforms and 250x'd.
Picks-and-shovels for the internet. Real business, real profits, but priced at 200x earnings. Took 20+ years to make a new all-time high. Revenue grew only 4x in 20 years.
Anchors are hand-curated 10-K snapshots. We surface the three whose 5-year revenue growth most-closely brackets the rate required to justify the current price. Source: SEC EDGAR.
Business Model & Valuation
How They Make Money
The company is retiring 2.9% of its shares per year, boosting per-share growth, in addition to funding operations from positive operating cash flow.
Free Cash Flow DCF High
Standard FCF DCF: positive free cash flow in a sector suited for cash-flow-based valuation.
Show advanced inputs
| RevenueGrowth | 4.9% |
| EpsGrowth | 38.1% |
| HistoricalFcfGrowth | 4.5% |
| SectorDefault | 6.0% |
| BestEstimate | 5.2% |
| Method | blend(70% revenue_cagr, 30% sector)+buyback(2.9%) |
| GrowthBasis | total |
Maturity & Competitive Position
Moat Signals
Revenue has been growing at 4.9%/yr over the last four years, from $13341M to $16140M.
Geography & Markets
AECOM is a global company with operations across various regions, though specific geographic mix percentages are not available from current data. It is known to have a significant presence in North America, Europe, and Asia.
Geographic Risks
Market Signals
These are timing signals, not value signals — they describe the stock's recent price behavior, not what the business is worth. Use them for the "the thesis looks good, but is now the moment?" question. Each tile below explains what it's saying.
Why it matters: Short-term contrarian indicator. Extreme readings often precede mean reversion, though not always.
Reference: 30–70 normal · >70 overbought · <30 oversold
Full explanation → (14)28.7OversoldHeavily sold off recently — sometimes a bounce setup, sometimes a falling knife.
Why it matters: When the fast line crosses above the slow line, short-term momentum is turning up; below, turning down. A timing cue, not a value signal.
Reference: Line above signal = bullish momentum · below = bearish
Full explanation →BullishLine above signalThe fast trend is above the slow trend — short-term momentum is currently upward.
Technicals describe price, not the business. A great company can have a "bearish" tape (a buying chance) and a weak one a "bullish" tape (a trap). Pair these with the valuation and health sections above.
QUALITY
Data Quality & Risk Flags (1 notes — click to expand/collapse)
Guardrail Notes (1)
- Per-share growth boosted by buybacks: the company is retiring 2.9% of its shares per year, which adds directly to per-share growth on top of business growth. Final per-share growth used by the model: 8.1%/yr.
FINANCIALS
Financial Statements (5-year tables — click to expand)
From AECOM's SEC filings (EDGAR).
Income (5yr)
| Year | Revenue | Net Income | EPS |
|---|---|---|---|
| 2025 | 16.1B | 561.8M | $4.21 |
| 2024 | 16.1B | 402.3M | $2.95 |
| 2023 | 14.4B | 55.3M | $0.39 |
| 2022 | 13.1B | 310.6M | $2.18 |
| 2021 | 13.3B | 173.2M | $1.16 |
Cash Flow (5yr)
| Year | Operating CF | CapEx | Free Cash Flow |
|---|---|---|---|
| 2025 | 821.6M | 136.7M | 623.5M |
| 2024 | 827.5M | 119.6M | 646.4M |
| 2023 | 696.0M | 105.6M | 544.5M |
| 2022 | 713.6M | 137.0M | 538.1M |
| 2021 | 704.7M | 136.3M | 523.7M |
Balance Sheet
| Total Assets | 12.2B |
| Total Liabilities | 9.5B |
| Equity | 2.5B |
| Total Debt | 66.3M |