AECOM Stock Has Large Players Volume Turn Up and TMF Breaking Positive

AECOM reported both earnings and revenue beats which made the large players volume turn up sharply while the Twiggs Money Flow broke positive.

Large players volume in AECOM stock has turned up and the Twiggs Money Flow has just gone positive. These bullish technical signals happened because of today’s earnings and revenue beats.

AECOM reported EPS of $0.74 versus the $0.73 estimate. Revenue also beat coming in at $4.86 billion during the quarter, versus the $4.63 billion estimate. AECOM’s revenue for the quarter was up an impressive 12.3% year-over-year.

The catalyst driving this stock higher is the thesis that the Trump Administration is targeting the “I” (investment) component of the GDP formula which favors increased investment in infrastructure and the “G” (government spending) component as it relates to defense markets.

On October 27, 2017, Citigroup Inc. reiterated its Buy Rating on AECOM stock. Citigroup has a $40 price target on the stock.

AECOM is engaged in designing, building, financing and operating infrastructure assets for governments, businesses and organizations. The Company’s segments include design and consulting services, construction services, and management services.

ACM is a good setup opportunity. We see reduced volatility while prices have been consolidating in the most recent period. A pullback is taking place, which may present a good opportunity for an entry. There is a resistance zone just above the current price starting at $35.83. Right above this resistance zone may be a good entry point. There is a support zone below the current price at $35.58, a stop order could be placed below this zone. We notice that large players showed an interest for ACM in the last couple of days, which is a good sign. Very recently a Pocket Pivot signal was observed. This is another positive sign.

AECOM Review
2.3

Summary

Profitability

ACM's Return On Equity of 6.59% is in line with the rest of the industry. The industry average Return On Equity is 6.59%. ACM has a Piotroski-F score of 6. This indicates an average health and profitability for ACM. ACM has a Return On Assets of 1.87%. This is below the industry average of 2.32%. ACM has a Profit Margin of 1.46%. This is below the industry average of 2.19%.

Valuation

ACM's Price/Earning Ratio is rather cheap when compared to the industry average which is at 25.03. ACM is also cheaper than 85% of the companies in the same industry. The low PEG Ratio, which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company. Compared to an average industry price book ratio of 2.14, ACM is valued rather cheaply. Compared to an average industry Enterprise Value to EBITDA ratio of 12.68, ACM is valued rather cheaply. With a Price/Earnings Ratio of 17.09, ACM is valued on the expensive side. The Forward Price/Earnings Ratio of 13.25 indicates a correct valuation of ACM. When comparing the current price to the book value of ACM, we can conclude it is valued correctly. It is trading at 1.43 times its book value.

Growth

The Earnings Per Share has grown by an impressive 75.32% over the past year. The Earnings Per Share is expected to grow by 60.26% on average over the next 2 years. This is very strong growth! Measured over the past 5 years, ACM shows strong growth in revenue. Revenue has been growing by 16.54% on average per year. The Earnings Per Share has been decreasing by -3.32% on average over the past 5 years. The EPS growth is stable: in the next 2 years the growth will be about the same as the last 5 years.

Health

ACM has a Current Ratio of 1.22. This is a normal value and indicates that ACM is financially healthy and should not expect problems in meeting its short term obligations. A Quick Ratio of 1.22 indicates that ACM should not have too much problems paying its short term obligations. An Altman-Z score of 1.82 indicates that ACM is not a great score, but indicates only limited risk for bankruptcy at the moment. ACM has a Piotroski-F score of 6. This indicates an average health and profitability for ACM. When comparing the Current Ratio of ACM to the average industry Current Ratio of 1.91, ACM is less able to pay its short term obligations than its industry peers. 100% of its industry peers have a better Current Ratio. When comparing the Quick Ratio of ACM to the average industry Current Ratio of 1.59, ACM is less able to pay its short term obligations than its industry peers. 89% of its industry peers have a better Quick Ratio. When comparing the Debt to Equity Ratio of ACM to the average industry Debt to Equity Ratio of 0.36, ACM required more debt to finance its operations than its industry peers. Compared to an average industry Altman-Z score of 3.18, ACM is in worse financial state than most of its industry peers. 89% of its industry peers have a better Altman-Z score.

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Lance Jepsen

For ethical purposes, I try not to hold any position in any stock I profile on GuerillaStockTrading.com unless specifically stated in the article. Owner of GuerillaStockTrading.com. Seasoned entrepreneur, investor, and writer. I love God, family, country, stock trading, economics, and helping people learn how to trade.
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Author: Lance Jepsen

For ethical purposes, I try not to hold any position in any stock I profile on GuerillaStockTrading.com unless specifically stated in the article. Owner of GuerillaStockTrading.com. Seasoned entrepreneur, investor, and writer. I love God, family, country, stock trading, economics, and helping people learn how to trade.

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