Morningstar

Atkinsrealis Group Inc ATRL

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Stock XTSE Rating as of
CAD 58.72 +0.81 (1.40%)
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As of Delayed Price Closed

Company Report

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AtkinsRealis Is Delivering Improved Results Under New Strategic Direction

Krzysztof Smalec

Since Ian Edwards took the helm as president and CEO in June 2019, management has transformed and significantly derisked AtkinsRealis' portfolio. During his tenure, the company has ceased bidding on lump-sum turnkey (LSTK) projects and divested its oil and gas business. We view the new strategic direction favorably, as cost overruns on LSTK projects led to negative cash flows in recent years. The company has steadily reduced its LSTK backlog to only CAD 0.3 billion at the end of the second quarter of 2024, which we believe significantly reduces the risk of further material cost overruns. The firm’s operating cash flow inflected positive in the second half of 2023, and we expect more stable results once the firm completes the remaining LSTK backlog.

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Price vs Fair Value

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ATRL is trading at a 345% premium.
Price
CAD 57.91
Fair Value
CAD 96.00
Uncertainty
High
1-Star Price
CAD 43.00
5-Star Price
CAD 52.00
Economic Moat
Llsz
Capital Allocation
Btrvgrhk

Bulls Say, Bears Say

Bulls

We think that AtkinsRealis’ nuclear segment has carved a narrow moat based on intangible assets and switching costs. The segment consistently delivers midteens operating margins and has solid growth prospects.

Bears

Execution issues have resulted in significant charges on lump-sum turnkey projects.

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News

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Trading Information

Previous Close Price
CAD 57.91
Day Range
CAD 58.25–58.93
52-Week Range
CAD 37.09–60.55
Bid/Ask
CAD 58.56 / CAD 58.90
Market Cap
CAD 10.29 Bil
Volume/Avg
295,549 / 282,259

Key Statistics

Price/Earnings (Normalized)
27.57
Price/Sales
1.12
Dividend Yield (Trailing)
0.14%
Dividend Yield (Forward)
0.14%
Total Yield
0.14%

Company Profile

Based in Montreal, AtkinsRealis is a fully integrated professional services and project management firm that offers a wide range of services, including financing, consulting, engineering and construction, procurement, and operations and maintenance. The firm serves clients in the infrastructure, nuclear, and engineering design and project management industries. Additionally, the company owns infrastructure projects through its capital segment. AtkinsRealis generated approximately CAD 8.6 billion in sales in 2023.
Sector
Industrials
Industry
Engineering & Construction
Stock Style Box
Mid Growth
Total Number of Employees
33,876
Website
https://www.snclavalin.com

Competitors

Valuation

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Metric
ATRL
J
ACM
Price/Earnings (Normalized)
 27.5717.8324.08
Price/Book Value
 2.992.616.06
Price/Sales
 1.121.040.89
Price/Cash Flow
 26.8820.2322.85
Price/Earnings
ATRL
J
ACM

Financial Strength

Metric
ATRL
J
ACM
Quick Ratio
 0.871.110.99
Current Ratio
 0.931.141.13
Interest Coverage
 3.075.743.74
Quick Ratio
ATRL
J
ACM

Profitability

Metric
ATRL
J
ACM
Return on Assets (Normalized)
 4.08%6.61%5.09%
Return on Equity (Normalized)
 13.19%14.92%25.66%
Return on Invested Capital (Normalized)
 9.54%9.97%12.93%
Return on Assets
ATRL
J
ACM

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