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Balfour Beatty PLC (GB:BBY)
LSE:BBY
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Balfour Beatty (BBY) AI Stock Analysis

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GB:BBY

Balfour Beatty

(LSE:BBY)

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Outperform 74 (OpenAI - 4o)
Rating:74Outperform
Price Target:
688.00p
▲(8.18% Upside)
Balfour Beatty's overall stock score is driven by strong financial performance and positive technical indicators. The company's robust cash flow and stable balance sheet are significant strengths. While the stock shows bullish momentum, the high RSI suggests caution due to potential overbought conditions. The valuation is reasonable but not particularly compelling, which slightly tempers the overall score.

Balfour Beatty (BBY) vs. iShares MSCI United Kingdom ETF (EWC)

Balfour Beatty Business Overview & Revenue Model

Company DescriptionBalfour Beatty plc finances, designs, develops, builds, and maintains infrastructure in the United Kingdom, the United States, and internationally. It operates through three segments: Construction Services, Support Services, and Infrastructure Investments. The Construction Services segment provides civil engineering, building, ground engineering, mechanical and electrical, refurbishment, fit-out, and rail engineering services. The Support Services segment designs, upgrades, manages, and maintains water, gas, and electricity networks, as well as rail and highways. The Infrastructure Investments segment is involved in the acquisition, operation, and disposal of infrastructure assets, such as roads, hospitals, student accommodation, military housing, offshore transmission networks, waste and biomass, and other concessions. This segment also develops and finances public and private infrastructure projects. The company serves government departments and agencies, regulated utilities, and private sector organizations. Balfour Beatty plc was founded in 1909 and is based in London, the United Kingdom.
How the Company Makes MoneyBalfour Beatty generates revenue primarily through its construction and engineering services, which include large-scale infrastructure projects such as roads, railways, and airports. The company earns money by securing contracts through competitive bidding processes and often works on a cost-plus or fixed-price basis. Key revenue streams come from public sector projects, private sector developments, and partnerships with other firms in joint ventures. Additionally, BBY benefits from long-term maintenance contracts and asset management services, which provide recurring revenue. Strategic partnerships with government agencies and private developers also contribute to its earnings, as they often lead to large, multi-year contracts that ensure a steady flow of income.

Balfour Beatty Earnings Call Summary

Earnings Call Date:Aug 13, 2025
(Q4-2024)
|
% Change Since: |
Next Earnings Date:Mar 18, 2026
Earnings Call Sentiment Positive
The earnings call reflected a strong financial performance with significant growth in revenue, profit, and order book. The company demonstrated robust cash management and increased dividends. However, challenges persist in the US Civils segment and the impact of the UK Building Safety Act, alongside some legal issues in the US. Despite these challenges, the overall sentiment leans towards optimism due to strong growth potential and strategic positioning in key markets.
Q4-2024 Updates
Positive Updates
Strong Financial Performance
Revenue grew by 4% to GBP10 billion, with profit from earnings-based businesses increasing by 7% to GBP252 million. Overall profit for the year rose by 11% to GBP227 million, and earnings per share increased by 17% to 43.6 pence.
Significant Order Book Growth
The order book grew by 12% to GBP18.4 billion, providing increased visibility for future work. UK Construction increased slightly to GBP6.2 billion, while the US order book rose by 25%.
Cash and Dividend Strength
Year-end net cash was GBP943 million, with average net cash of GBP766 million. A final dividend of 8.7 pence was announced, bringing the total dividend for the year to 12.5 pence, a growth of 9% over the prior year.
Employee and Safety Achievements
Employee engagement improved to 84%, which is 10 points higher than peer groups. The safety record has dramatically improved, with lost time accidents halved since 2021.
US Market Growth Potential
US Buildings saw a 24% growth, with strong performance across various sectors including tech, hospitality, and education. The US order book shows strong growth potential with several major frameworks won.
Negative Updates
US Civils Profitability Challenges
The US Civils segment continues to face profitability issues, with PFO reduced to GBP40 million due to delayed Civils projects.
Building Safety Act Impact
A charge of GBP83 million was recognized in relation to the group's obligations under the UK Building Safety Act, reflecting the challenges in meeting new regulatory standards.
US Legal and Contractual Challenges
A provision of GBP52 million was made due to a jury verdict against the group regarding a US highways project completed in 2012.
Decline in Hong Kong Order Book
In Hong Kong, the order book is down 11% as major airport projects reach completion, leading to a forecasted decline in revenue.
Company Guidance
During the call, Balfour Beatty provided comprehensive guidance with several key metrics highlighting their strong performance and optimistic outlook. For fiscal year 2024, revenue grew by 4% to GBP10 billion, with a profit increase of 11% to GBP227 million and earnings per share rising 17% to 43.6 pence. The order book expanded by 12% to GBP18.4 billion, with a directors' valuation up 3%. The company ended the year with GBP943 million in net cash and announced a final dividend of 8.7 pence, totaling a 12.5 pence dividend for the year, a 9% growth over the prior year. Looking ahead, the company expects PFO growth in 2025 with improved margins across divisions, targeting average net cash of GBP800 million and capital expenditures between GBP35 million and GBP40 million. They also aim to return another GBP1 billion to shareholders over the next five years through buybacks and dividends, building on the GBP1 billion returned in the past five years.

Balfour Beatty Financial Statement Overview

Summary
Balfour Beatty exhibits a strong financial position with consistent revenue growth and robust cash flow generation. The balance sheet is stable, with moderate leverage and decent returns on equity. While the company faces some operational efficiency challenges, its cash management and profitability remain strengths, supporting its growth trajectory in the engineering & construction industry.
Income Statement
75
Positive
The company demonstrates strong revenue growth with a 3% increase in 2024 compared to 2023. Gross profit margin is stable at 5.1%, and net profit margin improved to 2.2% in 2024, indicating healthy profitability. However, the EBIT margin decreased to 2.1%, suggesting potential operational efficiency challenges.
Balance Sheet
68
Positive
Balfour Beatty's balance sheet reflects a stable equity base with an equity ratio of approximately 19.9% in 2024. The debt-to-equity ratio is moderate at 0.99, showing controlled leverage. Return on Equity (ROE) is modest at 15.9%, indicating decent returns on shareholder investment.
Cash Flow
82
Very Positive
The company displays strong cash flow management with a free cash flow growth rate of 8.2% in 2024. The operating cash flow to net income ratio is robust at 1.49, showcasing strong cash generation relative to net earnings. Free cash flow to net income ratio remains healthy at 1.33, reflecting solid cash flow conversion.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue8.87B8.23B7.99B7.63B7.20B7.32B
Gross Profit420.00M417.00M412.00M421.00M335.00M233.00M
EBITDA188.00M320.00M344.00M329.00M174.00M171.00M
Net Income183.00M178.00M197.00M288.00M140.00M30.00M
Balance Sheet
Total Assets6.02B5.63B5.26B5.12B4.85B4.68B
Cash, Cash Equivalents and Short-Term Investments1.80B1.29B1.41B1.18B1.03B792.00M
Total Debt1.13B1.11B981.00M738.00M615.00M653.00M
Total Liabilities4.94B4.50B4.06B3.74B3.47B3.34B
Stockholders Equity1.07B1.12B1.20B1.38B1.37B1.34B
Cash Flow
Free Cash Flow614.00M237.00M219.00M137.00M318.00M241.00M
Operating Cash Flow653.00M265.00M285.00M168.00M353.00M274.00M
Investing Cash Flow-37.00M46.00M33.00M146.00M116.00M7.00M
Financing Cash Flow-234.00M-251.00M-158.00M-189.00M-266.00M-253.00M

Balfour Beatty Technical Analysis

Technical Analysis Sentiment
Positive
Last Price636.00
Price Trends
50DMA
581.15
Positive
100DMA
542.14
Positive
200DMA
491.17
Positive
Market Momentum
MACD
15.17
Positive
RSI
66.96
Neutral
STOCH
51.43
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:BBY, the sentiment is Positive. The current price of 636 is above the 20-day moving average (MA) of 618.95, above the 50-day MA of 581.15, and above the 200-day MA of 491.17, indicating a bullish trend. The MACD of 15.17 indicates Positive momentum. The RSI at 66.96 is Neutral, neither overbought nor oversold. The STOCH value of 51.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:BBY.

Balfour Beatty Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
2.02B13.1220.35%2.27%6.93%21.50%
74
Outperform
£3.08B17.5416.34%2.00%9.97%-15.46%
73
Outperform
905.80M16.282.56%4.40%26.56%
73
Outperform
983.10M7.1223.97%1.30%-1.17%12.31%
71
Outperform
494.28M14.7127.52%3.38%5.78%-8.32%
60
Neutral
349.25M10.9212.98%2.29%-12.98%5.51%
63
Neutral
$10.79B15.437.44%2.01%2.89%-14.66%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:BBY
Balfour Beatty
636.00
210.55
49.49%
GB:COST
Costain
131.00
32.66
33.21%
GB:GFRD
Galliford Try
503.00
213.33
73.65%
GB:KLR
Keller Group plc
1,410.00
-180.16
-11.33%
GB:KIE
Kier Group plc
214.00
77.55
56.83%
GB:MGNS
Morgan Sindall
4,305.00
1,345.64
45.47%

Balfour Beatty Corporate Events

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program
Neutral
Sep 11, 2025

Balfour Beatty has announced the repurchase of 124,140 ordinary shares as part of its ongoing share buyback program, which was initially announced in January 2025 and expanded in March 2025. The repurchased shares will be held in treasury, leaving the total number of voting rights in the company at 496,368,703. This move is part of Balfour Beatty’s strategy to manage its capital structure and return value to shareholders, potentially impacting the company’s market positioning and shareholder interests.

The most recent analyst rating on (GB:BBY) stock is a Buy with a £710.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program with Latest Repurchase
Neutral
Sep 10, 2025

Balfour Beatty has announced the repurchase of 123,323 ordinary shares as part of its ongoing share buyback program, with shares purchased at prices ranging from 612 to 623 pence. The repurchased shares will be held in treasury, and the total number of voting rights in the company remains at 496,492,843. This move is part of Balfour Beatty’s strategy to manage its capital structure and return value to shareholders, potentially impacting shareholder interests and market perceptions.

The most recent analyst rating on (GB:BBY) stock is a Buy with a £710.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Executive/Board Changes
Balfour Beatty Issues Share Awards to CEO Philip Hoare
Neutral
Sep 9, 2025

Balfour Beatty announced the issuance of conditional awards over ordinary shares to Philip Hoare, the Group Chief Executive, as part of a buy-out arrangement to compensate for remuneration forfeited from his previous employer. These awards, which include both restricted and performance stock units, are set to vest in 2026 and 2027, contingent upon meeting specific performance conditions. This move is part of the company’s Performance Share Plan, reflecting its commitment to aligning executive compensation with long-term performance goals, potentially impacting shareholder value and company operations.

The most recent analyst rating on (GB:BBY) stock is a Buy with a £710.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program
Positive
Sep 9, 2025

Balfour Beatty has announced the repurchase of 124,540 ordinary shares as part of its ongoing share buyback program, with the shares to be held in treasury. This move is part of a broader strategy to manage its capital structure and enhance shareholder value, with implications for the company’s market positioning and shareholder engagement.

The most recent analyst rating on (GB:BBY) stock is a Buy with a £710.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program with Latest Purchase
Neutral
Sep 8, 2025

Balfour Beatty announced the purchase of 209,605 of its ordinary shares as part of its ongoing share buyback program, which was initially announced in January 2025 and increased in March 2025. These shares will be held in treasury, and the total number of voting rights in the company is now 496,740,706. This move is part of Balfour Beatty’s strategy to manage its capital structure and may influence shareholder interests under the FCA’s Disclosure and Transparency Rules.

The most recent analyst rating on (GB:BBY) stock is a Hold with a £640.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program with Latest Purchase
Positive
Sep 5, 2025

Balfour Beatty announced the purchase of 205,907 ordinary shares as part of its ongoing share buyback program, which was initially announced in January 2025 and increased in March 2025. These shares will be held in treasury, affecting the total number of voting rights in the company, which now stands at 496,950,311. The share buyback is part of the company’s strategy to manage its capital structure and provide value to shareholders, reflecting its strong financial position and commitment to returning capital to investors.

The most recent analyst rating on (GB:BBY) stock is a Hold with a £640.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program with Latest Purchase
Positive
Sep 4, 2025

Balfour Beatty announced the purchase of 204,383 of its ordinary shares as part of its ongoing share buyback program, which was initially announced in January 2025 and increased in March 2025. The repurchased shares will be held in treasury, and the total number of voting rights in the company now stands at 497,156,218. This move is part of Balfour Beatty’s strategy to manage its capital structure and return value to shareholders, reflecting confidence in its financial position and future prospects.

The most recent analyst rating on (GB:BBY) stock is a Hold with a £640.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Business Operations and StrategyStock Buyback
Balfour Beatty Advances Share Buyback Program with New Purchase
Neutral
Sep 3, 2025

Balfour Beatty announced the purchase of 205,671 ordinary shares as part of its ongoing share buyback program, with shares to be held in treasury. This move reduces the number of shares in circulation and aligns with the company’s strategy to manage its capital structure effectively. The buyback program, initially announced in January 2025 and expanded in March 2025, has seen the repurchase of over 19 million shares, which are held without voting rights. This action may impact shareholder calculations under the FCA’s Disclosure and Transparency Rules.

The most recent analyst rating on (GB:BBY) stock is a Hold with a £640.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Stock Buyback
Balfour Beatty Advances Share Buyback Program
Neutral
Sep 2, 2025

Balfour Beatty announced the purchase of 173,300 ordinary shares as part of its ongoing share buyback program, with shares to be held in treasury. This transaction is part of a larger effort under the buyback program, which has seen the repurchase of over 19 million shares, impacting the total number of voting rights and share calculations for stakeholders.

The most recent analyst rating on (GB:BBY) stock is a Hold with a £640.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Regulatory Filings and Compliance
Balfour Beatty Announces Total Voting Rights and Share Capital Update
Neutral
Sep 1, 2025

Balfour Beatty announced its total voting rights and issued share capital as of August 31, 2025. The company has an issued share capital of 517,023,820 ordinary shares, with 19,284,248 held in treasury, resulting in 497,739,572 total voting rights. This information is crucial for shareholders and others with notification obligations under the FCA’s Disclosure Guidance and Transparency Rules, as it helps determine their interest in the company.

The most recent analyst rating on (GB:BBY) stock is a Hold with a £640.00 price target. To see the full list of analyst forecasts on Balfour Beatty stock, see the GB:BBY Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 12, 2025