Stantec (STN) AI Stock Analysis

• Market Cap: $17.03B
• Dividend Yield: 0.58%
• Average Volume (3M): 299.97K
• Price to Earnings (P/E): 39.5
• Beta (1Y): 0.74
• Revenue Growth: 12.49%
• EPS Growth: 26.18%
• Country: CA
• Employees: 32,000
• Sector: Industrials
• Sector Strength: 78
• Industry: Engineering & Construction
• EPS (TTM): 1.36
• Shares Outstanding: 114,066,990
• 10 Day Avg. Volume: 300,681
• 30 Day Avg. Volume: 299,966
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.10
• Enterprise Value/Revenue: 2.40
• Enterprise Value/Gross Profit: 5.58
• Enterprise Value/Ebitda: 19.08
• 1Y Price Target: $161.66
• Price Target Upside: 8.29% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

• Rating: 78 Outperform
• Price Target: C$172.00 ▲(15.22% Upside)

Stantec's overall stock score is driven by its strong financial performance and positive earnings call, which highlight robust growth and strategic positioning. While technical analysis shows a stable trend, the high valuation and modest dividend yield slightly temper the overall score.

Positive Factors

Earnings

Stantec's EBITDA increased 19% year-over-year, surpassing both the consensus and the analyst's estimates.

Financial Performance

Backlog ended the quarter 12.8% higher year-over-year at a record high, providing excellent visibility for future work.

Strategic Positioning

STN remains well-positioned to capitalize on secular demand trends including infrastructure development, energy transition, climate change, and reshoring.

Negative Factors

Market Expectations

The target price increased to $145 due to upward estimate revisions and rolling forward the valuation base.

Stantec Business Overview & Revenue Model

Company Description

Stantec Inc. provides engineering, architecture, and environmental consulting services in the areas of infrastructure and facilities in Canada, the United States, and internationally. The company provides consulting services in engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics. It also offers structural, mechanical, electrical, plumbing, and hydraulics engineering services; transportation advisory, planning and analytics, transport engineering, and technical design; paleontological and archaeological services for the rail, transportation, water, and power and energy sectors; environmental and infrastructure services; and environmental and cultural resource compliance services. The company was formerly known as Stanley Technology Group Inc. and changed its name to Stantec Inc. in October 1998. Stantec Inc. was founded in 1954 and is headquartered in Edmonton, Canada.

How the Company Makes Money

Stantec generates revenue primarily through professional services provided in the sectors of engineering, architecture, and consulting. The company's revenue model is predominantly project-based, with fees charged for design, consulting, project management, and other related services. Key revenue streams include contracts with public and private sector clients for infrastructure projects, environmental assessments, and urban development initiatives. Stantec also benefits from long-term relationships with clients, which can lead to repeat business and ongoing projects. Additionally, the company engages in strategic partnerships and collaborations that enhance its service offerings and market reach, contributing to its overall earnings. Factors such as market demand for infrastructure development, urbanization trends, and government investment in public projects also play a significant role in driving Stantec's revenue growth.

Stantec Financial Statement Overview

Summary

Stantec demonstrates strong financial performance with consistent revenue growth, improving margins, and effective cash flow management. The company maintains a stable leverage position, but managing debt levels remains crucial.

Income Statement

Stantec's income statement reveals robust growth with a steady increase in revenue over the years, culminating in a TTM revenue of $7.7 billion. Gross profit margin remains strong, and the net profit margin has improved to 5.01% in TTM from 4.82% in 2024, indicating efficient cost management. The EBIT and EBITDA margins have also shown consistent improvement, reflecting operational efficiency and profitability.

Balance Sheet

The balance sheet reflects a balanced growth trajectory with a healthy equity base. The debt-to-equity ratio has remained stable, indicating effective leverage management. Return on equity has been steadily growing, showing improved profitability relative to equity. However, the equity ratio indicates a moderate reliance on debt financing, which could pose risks if not managed well.

Cash Flow

Stantec's cash flow statement demonstrates strong cash generation capabilities, with TTM operating cash flow surpassing $666 million. The free cash flow has consistently grown, showing effective capital expenditure management. The operating cash flow to net income ratio indicates solid cash conversion efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.78B	7.50B	6.48B	5.68B	4.58B	4.73B
Gross Profit	3.35B	3.20B	2.46B	2.42B	1.96B	1.93B
EBITDA	980.20M	901.70M	801.00M	677.50M	523.40M	491.50M
Net Income	436.70M	361.50M	331.20M	247.00M	200.70M	171.10M
Balance Sheet
Total Assets	6.97B	6.96B	6.08B	5.65B	5.23B	4.39B
Cash, Cash Equivalents and Short-Term Investments	363.70M	254.70M	352.90M	148.30M	193.90M	285.00M
Total Debt	2.14B	2.04B	1.73B	1.92B	1.92B	1.32B
Total Liabilities	3.93B	4.01B	3.32B	3.37B	3.22B	2.46B
Stockholders Equity	3.04B	2.95B	2.76B	2.29B	2.00B	1.93B
Cash Flow
Free Cash Flow	647.10M	504.10M	444.10M	229.40M	346.40M	569.60M
Operating Cash Flow	720.40M	603.10M	544.70M	304.30M	397.00M	603.80M
Investing Cash Flow	-113.40M	-605.00M	-201.70M	-73.80M	-764.80M	-102.00M
Financing Cash Flow	-484.30M	-152.10M	-134.00M	-296.70M	276.50M	-412.60M

Stantec Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 149.28
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:STN, the sentiment is Neutral. The current price of 149.28 is below the 20-day moving average (MA) of 149.88, below the 50-day MA of 149.87, and above the 200-day MA of 128.35, indicating a neutral trend. The MACD of 0.20 indicates Negative momentum. The RSI at 48.50 is Neutral, neither overbought nor oversold. The STOCH value of 61.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:STN.

Stantec Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STN	78 Outperform	$17.03B	39.55	14.26%	0.58%	12.49%	26.18%
Sector *	64 Neutral	$10.84B	16.09	8.89%	1.97%	2.67%	-15.04%
SNCAF	―	$11.39B	6.47	57.95%	0.08%	―	―
BDGIF	―	$1.41B	25.63	21.65%	1.26%	―	―
WSP	78 Outperform	C$36.51B	45.81	10.52%	0.54%	18.24%	28.47%
ARE	68 Neutral	C$1.29B	50.72	2.78%	3.72%	20.53%	74.96%
BDT	66 Neutral	C$1.25B	12.90	25.25%	3.51%	8.49%	14.10%

Stantec Corporate Events

Stantec to Announce Q2 2025 Financial Results

Stantec announced it will release its second quarter 2025 financial results on August 13, 2025, followed by a webcast and conference call on August 14, 2025, led by CEO Gord Johnston and CFO Vito Culmone. This announcement is significant for stakeholders as it provides insights into the company’s financial performance and strategic direction, reinforcing its position as a leader in sustainable design and engineering.

The most recent analyst rating on (TSE:STN) stock is a Buy with a C$134.00 price target. To see the full list of analyst forecasts on Stantec stock, see the TSE:STN Stock Forecast page.