Actividades de Construccion y Servicios SA (ACS) AI Stock Analysis

• Market Cap: €28.56B
• Dividend Yield: 2.38%
• Average Volume (3M): 295.26K
• Price to Earnings (P/E): 29.7
• Beta (1Y): 0.93
• Revenue Growth: 25.47%
• EPS Growth: 7.63%
• Country: ES
• Employees: 157,284
• Sector: General
• Sector Strength: N/A
• Industry: Engineering & Construction
• EPS (TTM): 1.14
• Shares Outstanding: 271,664,580
• 10 Day Avg. Volume: 255,272
• 30 Day Avg. Volume: 295,263
• PEG Ratio: 1.61
• Price to Book (P/B): 4.54
• Price to Sales (P/S): 0.44
• P/FCF Ratio: 9.49
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €95.43
• Price Target Upside: -12.93% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 4
• EPS Forecast (FY): 3.91
• Revenue Forecast (FY): €55.22B

• Rating: 65 Neutral
• Price Target: €118.00 ▲(7.66% Upside)
• Action: Downgraded Date: 03/02/26
• Date: Action: Downgraded 03/02/26

The score is driven primarily by solid financial execution (revenue growth and improving free cash flow) but is held back by higher and worsening leverage and thin/pressured margins. Technicals are supportive due to strong trend strength, though overbought signals add caution, and valuation is a secondary drag due to the high P/E with only a modest dividend yield.

Positive Factors

Free cash flow strength

Material FCF improvement in 2025 (up ~41% and ~0.76x net income) indicates the business converts earnings to cash, supporting reinvestment, capex and potential deleveraging. Durable cash generation reduces reliance on external finance across project cycles and cushions execution risk.

Consistent revenue growth

Steady top-line expansion through 2022–2025 shows the company consistently wins and executes contracts, building backlog and scale. Sustained revenue growth supports operational leverage over time and underpins medium-term cash flow predictability despite sector cyclicality.

Diversified project and services mix

A mix of construction, engineering and recurring infrastructure services balances one-off large contracts with annuity-like service revenues. This diversification reduces concentration risk, smooths revenue seasonality, and provides multiple pathways for sustainable cash generation across cycles.

Negative Factors

Rising leverage

Debt-to-equity rising to ~3.34x increases financial vulnerability. Higher leverage amplifies earnings volatility from project delays or cost overruns, reduces strategic flexibility, and raises refinancing and interest-rate sensitivity, which can pressure cash available for operations and investments.

Thin and compressing margins

Persistently low net margins (~2%) and falling EBITDA/gross margins indicate limited pricing power or rising input costs. Margin compression curtails internal cash generation, limits buffer against project overruns, and reduces ability to invest or absorb cyclical downturns without increasing leverage.

Working-capital and cash volatility

Historical swings in operating cash (including negative FCF in 2021) reflect working-capital sensitivity in construction. Recurring volatility increases funding needs around large projects, can force short-term borrowing during stress, and raises execution and counterparty risk over multi-year contracts.

Actividades de Construccion y Servicios SA Business Overview & Revenue Model

Company Description

ACS, Actividades de Construcción y Servicios, S.A. provides construction and related services in Spain and internationally. The company undertakes construction activities related to development of highways, railways, maritime, airport works, hydraulic infrastructures, coasts, ports, civil engineering, educational and sports facilities, residential, and social infrastructures and facilities; undertakes contracts for the provision of mining services and infrastructure required for mining activities; and offers maintenance services for buildings, public places, and organizations. It also engages in the operation and maintenance activities, and development of real estate infrastructures; design, development, construction, and operation of infrastructure projects, real estates, and facilities; and promotion and development of transport and public facilities, as well as management of different public-private collaboration models. In addition, the company offers services for people, such as care for elderly citizens, dependent people, disabled people, and children aged up until the age of three; and manages playschools and collective restoration. Further, it provides services for building, such as maintenance, energy efficiency, cleaning, security, and logistics and auxiliary services; and services for public spaces comprising managing public lighting, which includes investing in changing light fittings, environmental services, and airport services. ACS, Actividades de Construcción y Servicios, S.A. was founded in 1997 and is based in Madrid, Spain.

How the Company Makes Money

ACS generates revenue through multiple streams, primarily from the construction and engineering services it provides for public and private sector projects. The company undertakes large infrastructure projects, such as roads, bridges, and airports, which typically involve long-term contracts that ensure steady income. Additionally, ACS earns revenue from its concessions, where it develops and operates infrastructure assets, generating income through tolls, fees, or service contracts. The company also has strategic partnerships with governments and other corporations that facilitate access to substantial projects, enhancing its market position and revenue potential. Furthermore, ACS diversifies its income through subsidiaries involved in renewable energy and environmental services, aligning with global trends toward sustainability and energy efficiency.

Actividades de Construccion y Servicios SA Financial Statement Overview

Summary

Good revenue momentum and improving free cash flow support fundamentals, but structurally thin margins and a rising leverage profile (debt-to-equity up to ~3.34x) meaningfully increase risk. Gross margin and EBITDA margin compression in 2025 also weighs on the score.

Income Statement

Revenue has expanded consistently from 2022–2025 (2025 up ~6%), indicating solid top-line momentum. Profitability is steady but thin for the sector, with net margin around ~2% in 2022–2025, and EBITDA margin easing from ~6.5% (2024) to ~4.9% (2025). A key watch-out is volatility/quality in reported profitability: 2021 shows an unusually high net margin (~10.9%) that did not persist, and 2025 gross margin dropped sharply versus prior years, suggesting either mix/one-offs or cost pressure.

Balance Sheet

Leverage is elevated and trending worse: debt-to-equity rose from ~1.95x (2023) to ~3.34x (2025), while equity is relatively small versus the asset base. Returns on equity are healthy (~19.7% in 2025), but that strength is partly amplified by higher leverage. The balance sheet is workable, but the rising debt load increases sensitivity to project cycles and financing conditions.

Cash Flow

Cash generation is a relative strength. Free cash flow is positive and improving, with 2025 free cash flow up strongly (~41%) and running at ~0.76x of net income, indicating earnings are broadly supported by cash. Operating cash flow has been solid in 2024–2025, though it was weak in 2021 (including negative free cash flow), highlighting some historical volatility typical of working-capital swings in construction.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	47.00B	49.85B	41.63B	35.74B	33.62B	27.84B
Gross Profit	18.71B	4.62B	13.35B	11.28B	10.25B	8.84B
EBITDA	3.14B	2.42B	2.70B	1.90B	2.11B	805.65M
Net Income	861.20M	950.34M	827.58M	780.12M	668.23M	3.05B
Balance Sheet
Total Assets	41.30B	45.93B	42.03B	36.50B	37.58B	35.66B
Cash, Cash Equivalents and Short-Term Investments	10.87B	14.32B	12.34B	9.82B	10.42B	12.29B
Total Debt	14.24B	16.08B	14.34B	10.39B	11.00B	10.99B
Total Liabilities	36.88B	40.75B	36.91B	30.87B	31.20B	28.64B
Stockholders Equity	4.19B	4.82B	4.71B	5.33B	5.55B	6.33B
Cash Flow
Free Cash Flow	1.63B	2.30B	2.18B	1.01B	1.46B	-183.07M
Operating Cash Flow	2.45B	3.05B	2.79B	1.50B	1.74B	203.14M
Investing Cash Flow	-839.90M	-1.65B	-1.25B	-15.75M	-198.10M	3.40B
Financing Cash Flow	-636.92M	47.58M	496.66M	-1.65B	-3.54B	-770.95M

Actividades de Construccion y Servicios SA Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 109.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ES:ACS, the sentiment is Positive. The current price of 109.6 is above the 20-day moving average (MA) of 102.39, above the 50-day MA of 95.40, and above the 200-day MA of 73.57, indicating a bullish trend. The MACD of 4.29 indicates Negative momentum. The RSI at 72.58 is Negative, neither overbought nor oversold. The STOCH value of 80.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ES:ACS.

Actividades de Construccion y Servicios SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FCC	70 Outperform	€5.32B	23.56	5.28%	4.49%	5.00%	-64.19%
FER	69 Neutral	€44.70B	51.12	69.30%	1.42%	5.75%	346.20%
ACS	65 Neutral	€28.56B	29.69	19.75%	2.38%	25.47%	7.63%
SCYR	65 Neutral	€3.53B	42.12	10.80%	5.28%	2.03%	-32.59%
ANA	60 Neutral	€13.47B	16.75	18.00%	2.87%	4.87%	339.22%
Sector *	55 Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
OHLA	48 Neutral	€591.68M	-285.33	-6.41%	―	1.39%	72.34%