Aecom (ACM) is an Incredible Growth Stock: 3 Reasons Why

Core Viewpoint - Investors are seeking growth stocks that can deliver above-average growth and exceptional returns, but identifying such stocks can be challenging due to their inherent risks and volatility [1] Group 1: Growth Stock Identification - The Zacks Growth Style Score system simplifies the identification of growth stocks by analyzing a company's real growth prospects beyond traditional metrics [2] - Aecom Technology (ACM) is highlighted as a recommended growth stock, possessing a favorable Growth Score and a top Zacks Rank [2] Group 2: Earnings Growth - Earnings growth is a critical factor for growth investors, with double-digit growth being particularly attractive as it indicates strong future prospects [3] - Aecom's historical EPS growth rate is 17.9%, with projected EPS growth of 15.9% this year, significantly outperforming the industry average of 10.7% [4] Group 3: Asset Utilization - The asset utilization ratio, or sales-to-total-assets (S/TA) ratio, is an important metric for assessing a growth stock's efficiency in generating sales [5] - Aecom's S/TA ratio is 1.34, indicating that the company generates $1.34 in sales for every dollar in assets, compared to the industry average of 1.18 [5] Group 4: Sales Growth - Sales growth is another key indicator of a company's attractiveness, with Aecom expected to achieve a sales growth of 5.6% this year, far exceeding the industry average of 0.2% [6] Group 5: Earnings Estimate Revisions - Trends in earnings estimate revisions are crucial, as positive revisions correlate strongly with stock price movements [7] - Aecom's current-year earnings estimates have been revised upward, with the Zacks Consensus Estimate increasing by 1.7% over the past month [7] Group 6: Overall Assessment - Aecom has earned a Growth Score of B and a Zacks Rank of 2 due to positive earnings estimate revisions, indicating it is a potential outperformer and a solid choice for growth investors [9]