Stantec has more gains ahead

Article Excerpt

Engineering firm Stantec is now up roughly 200% since we promoted the company to our Successful Investor Aggressive Growth Portfolio (in the April 2020 issue) from our Power Growth Investor newsletter. That’s mainly because higher government spending on new infrastructure projects is spurring demand for its services. The company’s new growth strategy and better efficiency should also continue to push the stock higher. STANTEC INC. $110 is a buy. This engineering firm (Toronto symbol STN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 114.1 million; Market cap: $12.6 billion; Price-to-sales ratio: 1.9; Dividend yield: 0.8%; TSINetwork Rating: Extra Risk; www.stantec.com) is a leading seller of consulting, project-delivery, design and technology services. The U.S. supplied 53% of Stantec’s 2023 revenue, followed by Canada (25%) and other countries (22%). Stantec tends to use acquisitions to spur its growth. It nonetheless cuts related risk by targeting smaller firms that are easy to absorb. Moreover, sharing administrative expenses, financing and employee benefits among its businesses helps to cut costs…