Stantec (STN) Earnings Date & Reports
Stantec Inc is a sustainable engineering, architecture, and environmental consulting company... Show more
STN is expected to report earnings to rise 21.38% to $1.16 per share on August 12
Stantec Inc. (STN) Q1 2026 Earnings Recap: Record Backlog Powers Ahead
Key Takeaways
- Stantec reported Q1 2026 net revenue of C$1,694.3 million, up 9.1% year-over-year, driven by 3.6% organic and 7.2% acquisition growth.
- Adjusted EBITDA rose 13.8% to C$287.0 million (16.9% margin), while adjusted EPS increased 14.7% to C$1.33.
- GAAP diluted EPS was C$0.97, surpassing analyst consensus estimates around C$1.29 for normalized figures in some reports.
- Contract backlog hit a record C$8.98 billion, up 13.2% from Q1 2025, providing 13 months of visibility.
- Company reaffirmed full-year 2026 guidance, targeting 8.5%-11.5% net revenue growth and 15%-18% adjusted EPS growth.
- Stock fell about 6% post-earnings, reflecting revenue slightly below some USD consensus expectations amid high volume trading.
Earnings Context and Why It Matters
Stantec Inc. (STN), a global leader in sustainable engineering, architecture, and environmental consulting, released its first quarter 2026 results for the three months ended March 31, 2026, on May 13, 2026. This report is pivotal as it marks the first quarterly update since the company's record 2025 performance, which featured C$6.5 billion in net revenue and an expanded backlog. With infrastructure spending rising amid energy transitions and climate resilience needs, investors scrutinize backlog growth, organic momentum, and margin expansion. Prior quarters showed consistent beats on adjusted metrics, but revenue mix shifts can pressure results. Strong execution here reinforces Stantec's positioning in high-demand sectors like water and buildings, guiding expectations for accelerated growth throughout 2026.
Stantec delivered gross revenue of C$2,067.7 million and net revenue of C$1,694.3 million, a 9.1% increase from C$1,553.0 million in Q1 2025. This growth comprised 3.6% organic net revenue expansion across all regions and 7.2% from acquisitions like Page. Project margin was C$914.1 million (54.0% of net revenue), slightly down 30 basis points year-over-year due to project mix but stable operationally.
Adjusted EBITDA climbed 13.8% to C$287.0 million (16.9% margin, up 70 basis points), fueled by cost discipline and lower administrative expenses as a percentage of revenue. Net income rose 10.7% to C$110.8 million, yielding diluted EPS of C$0.97 (up from C$0.88). Adjusted net income hit C$152.2 million, with adjusted diluted EPS of C$1.33 (up 14.7% from C$1.16), exceeding analyst consensus of C$1.29.
Regionally, U.S. net revenue grew to C$892.5 million (2.8% organic), Canada C$376.3 million (1.1% organic), and Global C$425.5 million (7.9% organic), led by Water (14.3%) and Energy & Resources (8.6%). Backlog reached C$8.98 billion (up 13.2%), with organic gains of 5.4%. No new guidance updates; full-year outlook reaffirmed. Dividend increased to C$0.245 per share.
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Market Reaction and Investor Sentiment
Following the May 13 after-market release, STN shares dropped approximately 6% to around $78 in regular trading on May 14, amid elevated volume over 660,000 shares (2x average). Despite EPS beats and record backlog, the reaction likely stemmed from net revenue of ~$1.24B USD (C$1.69B) falling short of some ~$1.26B USD consensus views, seasonal cash outflows, and broader industrials sector softness. Sentiment remains cautiously positive on organic backlog strength and reaffirmed guidance, though investors parsed project mix impacts on margins.
Forward Outlook and Key Factors to Monitor
Stantec reaffirmed its 2026 outlook, projecting 8.5%-11.5% net revenue growth (mid- to high-single-digit organic across regions) and adjusted EBITDA margin of 17.6%-18.2%. Adjusted EPS growth is targeted at 15%-18%, with adjusted net income margin at or above 9.5% and ROIC (return on invested capital) above 13%. This assumes stable FX rates (USD/CAD 1.36) and no further M&A (mergers and acquisitions).
Investors should track quarterly organic backlog additions, especially in U.S. (accelerating to mid-high single digits) and Global (Water asset management, Energy & Resources). Page integration progress will be key for Buildings backlog conversion. Monitor days sales outstanding (74 days in Q1, target <75), net debt to adjusted EBITDA (1.3x, target 1.0x-2.0x), and operating cash flows amid seasonal patterns.
Broader dynamics include public sector spending in Canada, U.S. infrastructure funding, and demand for resilience projects. Margin pressures from project mix or labor costs warrant attention, alongside FX volatility. Upcoming catalysts: Q2 results in August, potential wins in renewables and health care.
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General Information
a provider of engineering, architecture, and related professional services
Industry EngineeringConstruction