Stantec’s Raised 2025 Guidance Might Change the Case for Investing in Stantec (TSX:STN)

• Stantec Inc. recently reported its second quarter 2025 results, posting sales of C$1.96 billion and net income of C$135.4 million, alongside raising its full-year 2025 net revenue growth guidance to 10%–12% from the previously forecasted 7%–10%.
• The company’s strong performance was further highlighted by a substantial year-over-year increase in basic earnings per share, reflecting enhanced profit generation from its core operations.
• We'll examine how Stantec's increased full-year guidance signals management's confidence and may reshape its current investment outlook.

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Stantec Investment Narrative Recap

To own Stantec stock, you need to believe in the company’s ability to capitalize on robust infrastructure spending, integration of recent acquisitions, and expansion into higher-value consulting services. The announcement of improved full-year revenue guidance suggests management sees clear visibility on earnings for 2025, offering momentum for organic growth; however, persistent challenges from labor shortages and cost escalations in delivery centers may still act as the biggest risk and have not materially changed as a result of the latest results.

Among recent company announcements, the affirmation of a $0.225 quarterly dividend stands out. This reinforces Stantec’s history of consistent capital returns and aligns with their messaging of confidence in ongoing revenue streams, a factor likely contributing to investor sentiment along with the upgraded growth forecast.

In contrast, investors should pay close attention to lingering pressures from industry-wide labor shortages and rising operational costs, which could ...

Read the full narrative on Stantec (it's free!)

Stantec's outlook anticipates CA$8.2 billion in revenue and CA$785.7 million in earnings by 2028. This projection assumes a 10.0% annual revenue growth rate and a CA$349 million increase in earnings from the current level of CA$436.7 million.

Uncover how Stantec's forecasts yield a CA$162.36 fair value, a 8% upside to its current price.

Exploring Other Perspectives

The Simply Wall St Community offers five distinct fair value views for Stantec, ranging from CA$105 to CA$162 per share. While opinions vary, continued pressure on labor and wage costs remains a key operational challenge influencing many assessments on the company’s future performance.

Explore 5 other fair value estimates on Stantec - why the stock might be worth 30% less than the current price!

Build Your Own Stantec Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Stantec research is our analysis highlighting 2 key rewards that could impact your investment decision.
• Our free Stantec research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Stantec's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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