08:24 AM EDT, 06/12/2024 (MT Newswires) -- CIBC Capital Markets raised its price target on Bird Construction Inc. ( BIRDF ) to $25.50 from $22.

Analyst Jacob Bout maintained a Neutral rating on shares of the Canadian construction and maintenance company following an announcement that it will acquire privately-owned Jacob Bros Constriction.

"We like BDT's acquisition of Jacob Bros for a number of reasons," Bout said in a note to clients.

"First, the purchase price (multiple of 3.7x on BDT's estimate of 2024 EBITDA excluding synergies, well below BDT's standalone multiple) for a significantly higher-margin business is attractive, and thus immediately margin / adj. EPS accretive," the analyst said.

"Second, the transaction expands BDT's self-perform capabilities in the B.C. civil infrastructure market (robust medium- to long-term outlook for infrastructure spending)," Bout said.

"Third, there is significant potential for cross-selling opportunities over time (highly complementary business with several new key clients gained)," the analyst said.

"Lastly, the project contract type mix is not that dissimilar to BDT's (i.e., consistent risk profile)."

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