AECOM (ACM) Stock Forecast & Price Target

AECOM is well positioned for durable growth because it operates a diversified global advisory, design, and engineering platform across water, transportation, environment, and other secularly supported end markets, with a record $27.8 billion backlog that is up 13.1% year over year. Its profitability profile has improved meaningfully, as adjusted EBITDA rose from $657 million in fiscal 2019 to $1.203 billion in fiscal 2025 and margin expanded from 10.6% to 15.9%, while management still expects further margin expansion and 100%+ free cash flow conversion. The stock also benefits from resilient demand drivers, including infrastructure stimulus and PFAS remediation opportunity, while its shareholder-friendly capital return approach and continued share repurchases support long-term value creation.

AECOM is facing a negative fundamental setup because a $337 million pre-tax charge tied to a legacy design-build P3 project exposed weaker subcontractor productivity, delayed substantial completion to 2Q’27, and forced management to acknowledge that another similar project will also consume cash and management attention. The overhang is not just accounting-related: claims assets grew to about $620 million, total net cash outflows to finish both projects are expected at $600 million-$800 million, and about $500 million of free cash flow drag is expected in 1H’27, which also raises FY’27 net interest expense by $30 million-$35 million. Although backlog reached $27.816 billion and 3Q’26 adjusted EPS was $1.49 with adjusted EBITDA of $329 million, the company’s guidance was lowered as slower CM starts, Middle East disruption, margin pressure, and suspended buybacks point to weaker near-term earnings quality and investor confidence.