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AECOM (ACM) Initiates Quarterly Dividend Program, Retains View

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To consistently return capital to shareholders, AECOM (ACM - Free Report) initiated a recurring quarterly dividend program. On Dec 13, AECOM announced a quarterly cash dividend of 15 cents per share. The dividend will be payable on Jan 21, 2022, to shareholders of record as of the close of business on Jan 5.

This  trusted infrastructure consulting firm intends to increase the dividend per share by a double-digit percentage annually. AECOM reiterated its fiscal 2022 and long-term financial targets. For fiscal 2022, it expects adjusted earnings per share (EPS) in the range of $3.20-$3.40, adjusted EBITDA within $880-$920 million and free cash flow in the band of $450-$650 million.

In the long term (through fiscal 2024), it anticipates generating adjusted EPS of at least $4.75, 15% segment adjusted operating margin and continued high conviction in delivering on its 17% longer-term margin goal.

Troy Rudd, AECOM’s chief executive officer, said, "Today’s announcement reflects the confidence we have in our operating performance and outlook for organic growth, the strength of our balance sheet, and our expectation for continued compounding of earnings at a high rate and strong free cash flow. We intend to continue to repurchase stock as part of our capital allocation program, with dividends complementing repurchases as we seek to enhance total shareholder return and attract the broadest investor base possible."

Strategic Moves to Aid AECOM

AECOM is a leading solutions provider for supporting professional, technical and management solutions for diverse industries across end markets like transportation, facilities, government as well as environmental, energy and water businesses. A major part of the U.S. government’s broad infrastructural plan is focused on transit and water markets, wherein AECOM enjoys a dominant position.

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AECOM is executing a plan to transit into a pure-play professional services firm to improve profitability and de-risk the business profile. To that end, it is in the process of exiting more than 30 countries globally to prioritize investments in markets with higher prospects and competitive advantages.

The leading professional, technical and management solution provider has been witnessing a robust pipeline of pursuits across the business. The company’s net service revenues or NSR — defined as revenues excluding subcontractors and other direct costs — are benefiting from strength across the core transportation, water and environment markets.

The stock has rallied 53.5% in a year compared with the industry’s 35.4% growth. Earnings estimates for fiscal 2022 have moved up 3.1% in the past 30 days, depicting analysts' optimism over bottom-line growth potential. The Zacks Consensus Estimate for the Zacks Rank #3 (Hold) company’s fiscal 2022 earnings indicates a 17% increase from the 2021 level. AECOM currently has good visibility into growth and a strong backlog for the upcoming quarters.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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