Why ABM Industries Stock Sagged by Almost 10% Today

Core Viewpoint - Analysts and investors have turned bearish on ABM Industries following disappointing fourth-quarter results, leading to a nearly 10% decline in stock value [1]. Financial Performance - ABM Industries reported a record revenue of $2.3 billion for the fourth quarter, marking an increase of over 5% year-over-year [4]. - The company's net income, not in accordance with GAAP, was just under $55 million ($0.88 per share), which is a slight decrease from the previous year [4]. - ABM slightly exceeded the consensus analyst estimate for revenue of $2.28 billion but significantly missed the expected non-GAAP net profit of $1.09 per share [4]. Analyst Recommendations - Andrew Wittmann from Baird downgraded ABM's recommendation from buy to neutral and reduced the price target from $55 to $51 per share [2]. - Joshua Chan from UBS also lowered his fair value assessment from $54 to $52 per share while maintaining a neutral recommendation [3]. Future Guidance - Management provided guidance for the new fiscal year, projecting revenue growth of 3% to 4% and adjusted net income between $3.85 and $4.15, an improvement over the $3.44 of fiscal 2025 [5]. Market Data - As of the latest trading session, ABM's stock price is $43.47, with a market capitalization of $3.0 billion [7]. - The stock experienced a significant drop of 9.91%, equating to a loss of $4.78 [7]. - The company maintains a gross margin of 11.86% and a dividend yield of 2.20% [7]. Investment Perspective - Despite the negative market reaction, ABM is considered habitually profitable and presents a potential buying opportunity due to its status as a Dividend King, with a consistent history of dividend increases [8].