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AtkinsRealis (TSE:ATRL)
TSX:ATRL
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AtkinsRealis
(TSX:ATRL)
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Rating:66Neutral
Price Target:
C$98.00
▲(12.30% Upside)
AtkinsRealis shows strong financial performance and attractive valuation, but technical indicators suggest bearish momentum. The earnings call provided a cautiously optimistic outlook with significant growth in key segments, though regional challenges and cash flow issues pose risks.
Positive Factors
Negative Factors
AtkinsRealis (ATRL) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$15.68B
Dividend Yield0.09%
Average Volume (3M)689.18K
Price to Earnings (P/E)6.5
Beta (1Y)1.29
Revenue Growth13.97%
EPS Growth715.65%
CountryCA
Employees38,446
SectorIndustrials
Sector Strength72
IndustryEngineering & Construction
Share Statistics
EPS (TTM)1.10
Shares Outstanding165,742,220
10 Day Avg. Volume595,252
30 Day Avg. Volume689,178
Financial Highlights & Ratios
PEG Ratio-38.59
Price to Book (P/B)3.54
Price to Sales (P/S)1.40
P/FCF Ratio36.51
Enterprise Value/Market Cap1.09
Enterprise Value/Revenue1.67
Enterprise Value/Gross Profit23.20
Enterprise Value/Ebitda5.18
Forecast
1Y Price Target
$120.52Price Target Upside38.10% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
AtkinsRealis Business Overview & Revenue Model
Company DescriptionAtkinsRealis (ATRL) is a leading provider of integrated project delivery and engineering services, specializing in infrastructure, environmental, and construction management sectors. The company offers a diverse range of solutions, including design, consulting, project management, and advisory services, catering to both public and private sector clients across various industries. With a strong commitment to sustainability and innovation, AtkinsRealis aims to deliver high-quality, cost-effective services that enhance the built environment and promote operational efficiency.
How the Company Makes MoneyAtkinsRealis generates revenue through multiple streams primarily focused on service delivery. The company earns money by charging clients for project management, engineering, and consulting services on a fee-for-service basis. Key revenue streams include long-term contracts with governmental agencies for infrastructure projects, private sector contracts related to construction management and environmental consulting, and specialized advisory services for sustainability initiatives. Additionally, strategic partnerships with other firms in the construction and engineering sectors enhance its market reach and contribute to its earnings, allowing the company to secure larger projects and diversify its service offerings.
AtkinsRealis Earnings Call Summary
Earnings Call Date:Aug 07, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Feb 27, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mix of strong growth in certain areas like Nuclear and capital allocation, while facing challenges in Engineering Services with delays and reduced growth outlook in USLA and EMEA segments. The balance of positive and negative aspects suggests a cautiously optimistic outlook.Q2-2025 Updates
Positive Updates
Record Backlog Achieved
AtkinsRéalis reached a record high backlog of $21 billion, driven primarily by demand in Engineering Services and Nuclear.
Strong Nuclear Growth
Nuclear revenue organically grew 56% to a quarterly record high of $567 million, with backlog increasing 223% year-over-year.
Successful Capital Allocation Activities
The company closed the acquisition of a majority stake in David Evans, and completed the sale of its interest in Highway 407, resulting in total proceeds of approximately $2.6 billion. They also paid down $900 million in debt and repurchased 9 million shares.
Positive EPS and EBITDA Growth
Adjusted EPS increased by 59% to $0.78 per diluted share, and adjusted EBITDA for the AtkinsRéalis Services segment increased 21% to $246 million.
Negative Updates
Decline in Engineering Services Regions Revenue
Engineering Services Regions revenue organically declined 1% to $1.9 billion, with a revised outlook for organic growth in 2025 now expected to be mid-single-digit percentage.
Challenges in USLA and EMEA Segments
Due to lower-than-expected revenue growth in the USLA and EMEA segments, the 2025 Engineering Services Regions revenue organic growth outlook was decreased.
Negative Free Cash Flow
Free cash flow stood at negative $163 million for the quarter, mainly due to higher working capital usage.
Delays in Major Projects
Delays or termination of a handful of major projects in EMEA and the USLA regions impacted the first half of the year.
Company Guidance
In the AtkinsRéalis Second Quarter 2025 Conference Call, the company reported strong financial performance with a 15% increase in services revenue, reaching $2.6 billion, and a record high total backlog of $21 billion. Notably, Nuclear revenue saw a significant 56% organic growth to $567 million, while Linxon grew by 11%. Adjusted EBIT for the AtkinsRéalis Services segment rose by 21% to $246 million. The company adjusted its 2025 revenue outlook, increasing expectations for the Nuclear segment but lowering projections for the Engineering Services Regions due to lower growth in the USLA and EMEA segments. Capital allocation included a $2.6 billion acquisition of a majority stake in David Evans, a $900 million debt repayment, and a $800 million share repurchase, leaving the company net cash positive. Looking forward, AtkinsRéalis plans to focus on organic and inorganic growth, particularly through strategic acquisitions in high-growth markets such as transport, water, and nuclear services.AtkinsRealis Financial Statement Overview
Summary
AtkinsRealis demonstrates solid growth and profitability with stable revenue and profit margins. The company effectively manages leverage, but cash flow efficiency needs improvement to sustain operations.Income Statement
AtkinsRealis has shown consistent revenue growth, with a TTM revenue growth rate of 3.54%. The gross profit margin is stable at around 8.71%, and the net profit margin has improved to 3.09% in the TTM. EBIT and EBITDA margins are also healthy, indicating efficient operations. However, the company needs to maintain this trajectory to ensure long-term profitability.75
Positive
Balance Sheet
The company's debt-to-equity ratio has improved to 0.56 in the TTM, indicating better leverage management. Return on equity is at 8.40%, showing decent profitability relative to shareholder equity. The equity ratio is stable, suggesting a balanced capital structure. Continued focus on reducing debt could enhance financial stability.70
Positive
Cash Flow
Operating cash flow remains positive, but free cash flow has declined slightly by 3.33% in the TTM. The operating cash flow to net income ratio is low at 0.11, indicating potential challenges in converting income into cash. Improving cash flow efficiency will be crucial for sustaining operations.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 10.20B | 9.57B | 8.53B | 7.47B | 7.29B | 6.92B |
| Gross Profit | 734.04M | 665.27M | 574.53M | 251.22M | -122.17M | -88.77M |
| EBITDA | 3.29B | 693.40M | 673.37M | 283.59M | 383.82M | -14.32M |
| Net Income | 2.54B | 283.87M | 287.21M | 9.75M | 666.56M | -965.45M |
Balance Sheet | ||||||
| Total Assets | 12.07B | 11.29B | 10.28B | 9.46B | 9.88B | 10.34B |
| Cash, Cash Equivalents and Short-Term Investments | 966.27M | 679.01M | 486.63M | 599.35M | 628.04M | 968.40M |
| Total Debt | 1.32B | 2.20B | 2.37B | 2.49B | 2.16B | 2.50B |
| Total Liabilities | 6.74B | 7.50B | 6.99B | 6.58B | 6.88B | 7.77B |
| Stockholders Equity | 5.26B | 3.77B | 3.28B | 2.87B | 2.97B | 2.56B |
Cash Flow | ||||||
| Free Cash Flow | 350.07M | 365.86M | -25.82M | -355.19M | 27.91M | 45.66M |
| Operating Cash Flow | 514.75M | 525.78M | 65.96M | -245.36M | 134.20M | 121.48M |
| Investing Cash Flow | 2.17B | 70.27M | 9.48M | -82.47M | -263.71M | -185.12M |
| Financing Cash Flow | -2.15B | -408.35M | -170.91M | 283.12M | -192.53M | -190.43M |
AtkinsRealis Technical Analysis
Negative
87.27
Price Trends
97.63
Negative
97.07
Negative
86.65
Positive
Market Momentum
-2.93
Positive
38.73
Neutral
21.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ATRL, the sentiment is Negative. The current price of 87.27 is below the 20-day moving average (MA) of 93.65, below the 50-day MA of 97.63, and above the 200-day MA of 86.65, indicating a neutral trend. The MACD of -2.93 indicates Positive momentum. The RSI at 38.73 is Neutral, neither overbought nor oversold. The STOCH value of 21.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ATRL.
AtkinsRealis Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | C$34.51B | 42.90 | 11.21% | 0.62% | 18.85% | 29.60% | |
70 Outperform | C$15.39B | 31.83 | 15.96% | 0.67% | 11.73% | 41.17% | |
67 Neutral | $2.44B | 31.99 | 22.05% | 1.04% | 13.02% | 52.88% | |
66 Neutral | $15.68B | 6.46 | 56.38% | 0.09% | 13.97% | 715.65% | |
64 Neutral | C$1.62B | 16.39 | 21.68% | 3.32% | 6.26% | 0.52% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | C$1.83B | 222.05 | 0.92% | 2.96% | 25.68% | ― |
* Industrials Sector Average
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AtkinsRealis Corporate Events
AtkinsRéalis Earnings Call: Mixed Results and Strategic Moves
Aug 13, 2025
AtkinsRéalis Earnings Call: Mixed Sentiments Amid Achievements and Challenges
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.