Hi Kevin,
I have been long ARE since before the failed takeover attempt by China CCC. I still own it for a reason. It has impressive long-term growth prospects and is one of the more respected names in the industry. ARE, WSP and STN are all poised to benefit from SNC Lavalin's downfall and the global industry is rife with big infrastructure projects.
I originally bought ARE for my dividend growth portfolio. Although it lost its status as a Dividend Aristocrat, it is important to note that the only reason why it did was because the dividend was kept steady as it was being acquired. It has since returned to dividend growth and raised dividends by 16% this past March.
It dipped recently as it posted disappointing third quarterly results in which the backlog shrunk. It did however beat estimates, and several analysts have since come out and re-iterated their 'buy' ratings on the stock. Likewise, management has called for strong EBITDA growth in 2020 on the back of a 22% rise in the next twelve month backlog. Will it meet estimates? Considering it has beat in 5 of the past 6 quarters by a 20%+ margin, the company has been underestimated. All 11 analysts rate the company a "buy" and they have a one-year price target of $25.1 which implies 40% upside.
Today, the company is trading at a reasonable 13.5 times forward earnings, a price-to-book of 1.26 and a tiny price-to-sales of 0.26. In my opinion, the company is cheap, should provide decent growth over the next couple of years and a rising dividend.
Mat
(Long ARE)