09:51 AM EDT, 07/03/2024 (MT Newswires) -- Stifel GMP on Wednesday reiterated its hold rating on the shares of Aecon Group ( AEGXF ) while raising its price target to C$16.50 from C$16.25 after the construction and engineering company acquired a Michigan-based utility contractor.

"Aecon Utilities has announced a majority stake acquisition of a Michigan-based utility contractor for C$100 mm (plus potential earn-outs). This is the first acquisition for the company's utilities roll-up strategy, and we believe it has a strong strategic rationale with a reasonable valuation (5.0x EV/EBITDA). We find the Utilities' roll-up strategy attractive, and this deal depicts the ability to acquire at attractive multiples (which had been in question). However, it does not outweigh our concerns over the four fixed-price legacy contracts. We have modestly increased our target price to $16.50 from $16.25, but retain our HOLD rating (despite nearly 25% upside due to higher-than-average risk)," analyst Ian Gillies wrote.

(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)

Price: 14.41, Change: +0.40, Percent Change: +2.86