We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
ABM Stock Gains 13% in 3 Months: Here's What You Should Know
Read MoreHide Full Article
Key Takeaways
ABM's first-half sales bookings of a record $1.2B signal strong demand and customer acquisition.
ABM's WGNSTAR buyout strengthened its semiconductor presence and drove high-double-digit organic growth.
ABM's FCF improved nearly $180M in the first six months as it reaffirmed its 2026 growth outlook.
ABM (ABM - Free Report) stock has had an impressive run over the past three months. The company’s shares have ascended 13.4%, outpacing the industry’s 1.8% rise and the Zacks S&P 500 Composite's 10.8% rally.
3-Month Share Price Performance
Image Source: Zacks Investment Research
Let us delve into the factors that have contributed to the company’s outperformance.
Unprecedented Sales & Organic Revenue Expansion
In the second quarter of fiscal 2026, ABM achieved a record $1.2 billion in sales bookings for the first half of the year. This indicates strong market demand for its services and the success of its customer acquisition strategies.
In the first quarter of fiscal 2026, ABM's organic revenues grew 5.5% year over year, moving up to 6.1% in the following quarter. Capitalizing on the lofty sales bookings, expectations around sustained momentum in organic revenues, which support the top line, are further solidified.
WGNSTAR Buyout Completion
ABM completed the WGNSTAR acquisition at the beginning of the second quarter of fiscal 2026. This buyout bolstered the company’s presence within the semiconductor fabrication environment.
During the second-quarter fiscal 2026 earnings call, Scott Salmirs, president, CEO and director, stated that the company has landed “tens of millions of dollars in new business,” hinting at the immediate benefits enjoyed from ABM’s market strength, facilitated by WGNSTAR. Moreover, this buyout led to delivering high double-digit growth in organic revenues across the company’s semiconductor market.
FCF Recovery Bolsters Liquidity
The company ended the second quarter of fiscal 2026 with a current ratio of 1.46. A current ratio exceeding 1 bodes well with investors as it suggests efficient coverage of short-term obligations. ABM’s liquidity position is better than its peers, as evidenced by an industry average of 1.13.
Image Source: Zacks Investment Research
ABM recorded $71.2 million in free cash flow (FCF) for the first six months of 2026 compared with the preceding year’s negative FCF of $107.8 million. It marks a hefty FCF enhancement worth nearly $180 million in the first six months. As the company recovered FCF, it raised management’s prospects to pay off short-term obligations, bolstering ABM’s liquidity position.
Reaffirmed 2026 Outlook Raises Investors’ Rapport
In the second quarter of fiscal 2026, ABM reaffirmed its full-year outlook, aiming at the top end of 3-4% organic growth and a 4-5% top-line improvement. The reaffirmed guidance indicates consistency that accumulates premium in the market. Investors gain confidence as sticking to a growth rate is a sign of a competitive moat and a resilient business model. ABM’s outlook acts as a safety net that leads to an increase in stock prices.
View the Zacks #1 Rank List
Image: Shutterstock
ABM Stock Gains 13% in 3 Months: Here's What You Should Know
Key Takeaways
ABM (ABM - Free Report) stock has had an impressive run over the past three months. The company’s shares have ascended 13.4%, outpacing the industry’s 1.8% rise and the Zacks S&P 500 Composite's 10.8% rally.
3-Month Share Price Performance
Let us delve into the factors that have contributed to the company’s outperformance.
Unprecedented Sales & Organic Revenue Expansion
In the second quarter of fiscal 2026, ABM achieved a record $1.2 billion in sales bookings for the first half of the year. This indicates strong market demand for its services and the success of its customer acquisition strategies.
In the first quarter of fiscal 2026, ABM's organic revenues grew 5.5% year over year, moving up to 6.1% in the following quarter. Capitalizing on the lofty sales bookings, expectations around sustained momentum in organic revenues, which support the top line, are further solidified.
WGNSTAR Buyout Completion
ABM completed the WGNSTAR acquisition at the beginning of the second quarter of fiscal 2026. This buyout bolstered the company’s presence within the semiconductor fabrication environment.
During the second-quarter fiscal 2026 earnings call, Scott Salmirs, president, CEO and director, stated that the company has landed “tens of millions of dollars in new business,” hinting at the immediate benefits enjoyed from ABM’s market strength, facilitated by WGNSTAR. Moreover, this buyout led to delivering high double-digit growth in organic revenues across the company’s semiconductor market.
FCF Recovery Bolsters Liquidity
The company ended the second quarter of fiscal 2026 with a current ratio of 1.46. A current ratio exceeding 1 bodes well with investors as it suggests efficient coverage of short-term obligations. ABM’s liquidity position is better than its peers, as evidenced by an industry average of 1.13.
ABM recorded $71.2 million in free cash flow (FCF) for the first six months of 2026 compared with the preceding year’s negative FCF of $107.8 million. It marks a hefty FCF enhancement worth nearly $180 million in the first six months. As the company recovered FCF, it raised management’s prospects to pay off short-term obligations, bolstering ABM’s liquidity position.
Reaffirmed 2026 Outlook Raises Investors’ Rapport
In the second quarter of fiscal 2026, ABM reaffirmed its full-year outlook, aiming at the top end of 3-4% organic growth and a 4-5% top-line improvement. The reaffirmed guidance indicates consistency that accumulates premium in the market. Investors gain confidence as sticking to a growth rate is a sign of a competitive moat and a resilient business model. ABM’s outlook acts as a safety net that leads to an increase in stock prices.
Zacks Rank & Stocks to Consider
ABM currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Business Services sector are Coherent Corp. (COHR - Free Report) and AppLovin (APP - Free Report) .
Coherent presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
COHR has a long-term earnings growth expectation of 46.8%.
Coherent delivered a trailing four-quarter earnings surprise of 6.2% on average.
AppLovin currently has a Zacks Rank of 2. APP has a long-term earnings growth expectation of 38.8%.
AppLovin delivered a trailing four-quarter earnings surprise of 8.4%, on average.