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DOW: Major Contracts And Long-Term Agreements Will Support Measured Outlook

DOW: New Contracts And Buyback Program Will Support Steady Outlook Ahead

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DOW
AnalystConsensusTarget
Not Invested
Published 06 Feb 2025

Update shared on 30 Nov 2025

Fair value Increased 4.68%
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AnalystConsensusTarget's Fair Value
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1Y
46.4%
7D
1.3%

Analysts have raised their price target for Downer EDI from $7.36 to $7.70, citing improved revenue growth expectations, even though there is a slight reduction in forecast profit margins.

What's in the News

  • Downer EDI secured a new contract with Chevron Australia for maintenance and support services at the Wheatstone and Gorgon facilities. The contract offers potential revenue of $750 million over up to 15 years (Client Announcements).
  • The company was awarded a $3.05 billion contract to provide base and estate services to the Australian Department of Defence across major regions for an initial six-year term, with the possibility of extending to 10 years (Client Announcements).
  • Downer EDI signed a 10-year contract with Urban Utilities to deliver water and wastewater infrastructure in South East Queensland, with the initial term scheduled to begin in September 2025 (Client Announcements).
  • Analyst/Investor Day held to update stakeholders on Downer EDI's recent developments and strategic outlook (Analyst/Investor Day).

Valuation Changes

  • Consensus Analyst Price Target (Fair Value): Increased from A$7.36 to A$7.70.
  • Discount Rate: Marginally decreased from 7.06% to 7.05%.
  • Revenue Growth: Upgraded from 3.20% to 3.60%.
  • Net Profit Margin: Reduced slightly from 3.18% to 3.05%.
  • Future P/E: Increased from 16.6x to 17.8x.

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Disclaimer

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