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AECOM (ACM): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q4 FY25, to Sep 30, 2025, filed Nov 19, 2025; rules v1.1
AECOM (ACM): 1 rule of 10 triggered on the filings to Sep 30, 2025: adjusted profit = economic profit. 1 to review; 3 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
Adjusted profit = economic profit Triggered · severity medium · confidence low
Adjusted EPS was at least 10% above GAAP in 3 of the last 3 quarters (on average 34% above). Costs excluded every quarter (restructuring, stock compensation, amortisation of acquired intangibles, litigation) are a recurring cost of the business, not a one-off.
Innocent reading: A genuine one-off this year (an impairment, a settlement) that happens to span several quarters.
A precise DCF value = the true value To review · confidence high
The DCF's point value is 39.35 a share (price 66.72); 74% of it is the terminal value, a number about years no one has seen. Moving operating margin by ±3 pts alone takes it from -1.02 to 79.72; across every method the research ran the range is -54 to 503. The value is a range; the decimals are not information.
Innocent reading: A stable, mature business with a narrow range of outcomes, where the point value is a fair summary.
Every rule
A01 FCF growth = the business improved Not triggered confidence high
Free cash flow did not rise ($708M → $685M): the trap does not arise.
The figures and how they are read
| Fiscal year before | FY24 |
| Fiscal year | FY25 |
| Operating cash flow, year before | $827M |
| Operating cash flow | $822M |
| Capex, year before | $120M |
| Capex | $137M |
| Free cash flow, year before | $708M |
| Free cash flow | $685M |
| Change in FCF | −$23M |
| Change in capex | $17M |
| Working capital: change in its cash contribution | −$827M |
FCF = operating cash flow − cash capex; ΔFCF = ΔOCF − ΔCapEx; the working-capital part is the change in the cash-bridge items (receivables, inventory, payables, accruals), with the sign of the cash flow statement
Source: FY25 (cash flow statement, fiscal year) · FY24 (cash flow statement, fiscal year before)
A07 Stock compensation added back = no economic cost Not triggered confidence high
Stock compensation is 0.4% of revenue: small enough that adding it back changes little.
The figures and how they are read
| Fiscal year | FY25 |
| Stock compensation | $61M |
| Revenue | $16.1B |
| SBC / revenue | +0.4% |
| Buybacks | $388M |
| Buybacks / SBC | 6.3 |
| Diluted shares, year before | 136.5M shares |
| Diluted shares | 133.3M shares |
| Diluted shares: change | -2.3% |
SBC / revenue from the cash flow statement's add-back; the diluted weighted share count year over year; buybacks from the financing section
Source: FY25 (stock compensation, buybacks and the diluted share count, fiscal year)
B02 Receivables growing = future cash is certain Not triggered confidence medium
Receivables grew -8% against revenue -14% in Q3 FY26; DSO 62 against a median of 58: collections are keeping pace with sales.
The figures and how they are read
| Quarter | Q3 FY26 |
| Revenue, year over year | -14.2% |
| Receivables, year over year | -8.0% |
| Quarter before | Q2 FY26 |
| Revenue y/y, quarter before | +0.8% |
| Receivables y/y, quarter before | -2.1% |
| Days sales outstanding | 61.6 |
| DSO, median of eight quarters | 58.2 |
| Receivables | $2.4B |
| Revenue | $3.6B |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q3 FY26 (receivables and revenue) · Q3 FY25 (the same quarter a year earlier)
B08 Adjusted profit = economic profit Triggered severity medium · confidence low
Adjusted EPS was at least 10% above GAAP in 3 of the last 3 quarters (on average 34% above). Costs excluded every quarter (restructuring, stock compensation, amortisation of acquired intangibles, litigation) are a recurring cost of the business, not a one-off.
The figures and how they are read
| Quarter / adjusted EPS / GAAP EPS / gap | 2025-12-31 / 1.29 / 0.56 / 0.566; 2026-03-31 / 1.59 / 1.39 / 0.126; 2026-06-30 / -0.5 / -0.67 / 0.34 |
| Quarters with adjusted ≥ 10% above GAAP | 3 |
| Quarters compared | 3 |
| Latest gap | +34.0% |
the analysts' 'actual' (usually the company's adjusted EPS) against GAAP net income ÷ diluted shares for the matching quarter; a gap of 10% or more counts (the stand-in until three releases' reconciliation tables are on file)
Source: 2025-12-31 (adjusted 1.29 vs GAAP 0.56) · 2026-03-31 (adjusted 1.59 vs GAAP 1.39) · 2026-06-30 (adjusted -0.50 vs GAAP -0.67)
What would explain it innocently
- A genuine one-off this year (an impairment, a settlement) that happens to span several quarters
- Amortisation of acquired intangibles, which many investors also exclude by choice
- The analysts' 'actual' is not the company's own adjusted figure
What to look for in the filing
- The reconciliation table in the earnings release: which items, how much, how often
- Whether the same items were excluded in earlier years
What would show the trap does not apply
- The reconciliation shows the excluded items ending (a restructuring with its final charge, a settlement paid) and the gap to GAAP closes in the next quarters
- The excluded items are only amortisation of acquired intangibles and the cash paid for the deals is in the investing cash flow
Look again: next filing.
C02 Low net debt = no refinancing risk Not triggered confidence medium
$66M comes due within a year, 18.4× covered by cash and investments of $1.0B plus $203M of free cash flow.
The figures and how they are read
| Cash and investments | $1.0B |
| Debt | $2.7B |
| Net debt | $1.7B |
| Due within a year | $66M |
| Read from | the debt maturity table |
| Free cash flow, twelve months | $203M |
| Cash plus free cash flow | $1.2B |
| Coverage of what is due | 18.4 |
| Due in the second year | $31M |
| Balance sheet date | 2026-06-30 |
due within a year from the maturity table (else the current portion of debt), against cash and investments plus free cash flow over the last twelve months (zero if negative); no credit lines assumed
Source: FY25 (debt maturities, cash and investments)
D03 EPS growth = profit growth Not applicable
a loss in one of the quarters: EPS growth has no meaning
E02 Low P/E at a cyclical peak = undervalued Not triggered confidence medium
Net income of $423M is not at a cyclical high against the last eight years (median $173M, best $562M): the P/E of 20.3× is on a normal year.
The figures and how they are read
| market value | $8.6B |
| net income ttm | $423M |
| pe ttm | 20.30 |
| net income median fy | $173M |
| pe mid cycle | 49.50 |
| net income peak fy | $562M |
| years | FY18 / 136.0; FY19 / -261.0; FY20 / -186.0; FY21 / 173.0; FY22 / 311.0; FY23 / 55.0; FY24 / 402.0; FY25 / 562.0 |
| down years in window | 2 |
P/E on the trailing twelve months' net income against the P/E on the median net income of the last eight fiscal years (a mid-cycle stand-in); 'at a peak' = this year's profit at or above 90% of the best year and at least 1.3× the median
Source: Q4 FY25 (net income, trailing twelve months)
E07 A precise DCF value = the true value To review confidence high
The DCF's point value is 39.35 a share (price 66.72); 74% of it is the terminal value, a number about years no one has seen. Moving operating margin by ±3 pts alone takes it from -1.02 to 79.72; across every method the research ran the range is -54 to 503. The value is a range; the decimals are not information.
The figures and how they are read
| dcf value | 39.35 |
| price | 66.72 |
| terminal value share | +74.3% |
| swing by input | Operating margin / ±3 pts / -1.02 / 79.72; WACC / ±1 pt / 31.02 / 51.6; Revenue growth (each year) / ±5 pts / 30.36 / 50.25; Capex (share of revenue) / ±1 pt / 34.88 / 43.83 |
| range all methods | -54.25; 502.55 |
the DCF's point value against the share of it that is the terminal value and the value at each input moved by one step (growth ±5 pts, WACC ±1 pt, margin ±3 pts …); the range across every method the research ran
Source: 2026-11-08 (valuation research)
What would explain it innocently
- A stable, mature business with a narrow range of outcomes, where the point value is a fair summary
- The inputs that matter most are themselves well known (a regulated return, a long contract)
What to look for in the filing
- Which input you believe differs from the research's and why
- What the price implies for growth (the reverse DCF on the fair-value page)
What would show the trap does not apply
- The DCF's value is robust to the terminal growth and discount rate (the range's low end is still above the price)
- The company's cash flows over the next three years track the DCF's early years
Look again: next filing.
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → AECOM: cash flow → Earnings quality score →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.