Aecon vs AECOM Which Should You Buy?

Aecon and AECOM are two prominent companies in the construction and engineering industry, each with their own unique strengths and weaknesses in the stock market. Aecon, a Canadian-based firm, has a strong presence in the infrastructure sector and has been a consistent performer in recent years. On the other hand, AECOM, a global leader in design and consulting services, has faced challenges but has shown resilience in navigating market fluctuations. Investors should carefully analyze the financials and growth potential of both companies before making investment decisions.

Aecon or AECOM?

When comparing Aecon and AECOM, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Aecon and AECOM.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Aecon has a dividend yield of 2.47%, while AECOM has a dividend yield of 0.79%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Aecon reports a 5-year dividend growth of 7.71% year and a payout ratio of 352.38%. On the other hand, AECOM reports a 5-year dividend growth of 0.00% year and a payout ratio of 43.24%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Aecon P/E ratio at 134.30 and AECOM's P/E ratio at 59.48. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Aecon P/B ratio is 1.92 while AECOM's P/B ratio is 6.60.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Aecon has seen a 5-year revenue growth of 0.70%, while AECOM's is -0.18%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Aecon's ROE at 1.27% and AECOM's ROE at 11.40%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $19.80 for Aecon and $110.36 for AECOM. Over the past year, Aecon's prices ranged from $7.78 to $20.96, with a yearly change of 169.41%. AECOM's prices fluctuated between $79.95 and $115.74, with a yearly change of 44.77%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.