North American Construction Will Start To Fire From All Cylinders (Upgrade)

2025-01-06 13:05:50 ET

Summary

• North American Construction Group Ltd.'s diversified contracts in Australia and Canada, coupled with improved fleet utilization, are expected to drive significant revenue and EBITDA growth in 2025.
• Despite high debt, improved profit margins and cash flow recovery are anticipated, enabling NOA to reduce leverage and increase dividends.
• NOA stock is undervalued compared to peers, which supports a “Buy” rating, with expectations of higher returns in the medium term.

NOA Has Upsides

I discussed North American Construction Group Ltd. ( NOA ) in the past, and you can read the previous article here , published on July 4, 2024. Increased activity in Australia and diversified resources in Canada helped it win several contracts in these regions recently. Stable oil sands business in Canada has led to fleet utilization, which should improve in Q4. Furthermore, it focuses on enhancing customer relationships, which has ensured extended contract terms and commitment over a longer period....

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