Recommendation: Buy
| Entry Date | Symbol | Recommendation | Entry Price (USD) | Target 1 (USD) | Target 2 (USD) | Holding Duration | Position Status | Return(%)* |
|---|---|---|---|---|---|---|---|---|
| 16 Jun, 25 | AMRC | Buy | USD 16.41 | USD 17.2 | USD 18.0 | 27 days | Closed |
13.65%
|
*Return(%) represent the percentage change between the entry price and exit price of the recommendation.
Data Powered by EOD Historical Data (“EODHD”).
Ameresco, Inc., a clean technology integrator, provides a portfolio of energy efficiency and renewable energy supply solutions in the United States, Canada, Europe, and internationally. It operates through U.S. Regions, U.S. Federal, Canada, Europe, Alternative Fuels, and All Other segments. The company offers energy efficiency, infrastructure upgrades, energy security and resilience, asset sustainability, and renewable energy solutions for businesses and organizations. It designs, develops, engineers, and installs projects that reduce the energy, as well as operations and maintenance (O&M) costs of its customers' facilities; and projects primarily include various measures customized for the facility and designed to enhance the efficiency of building systems, such as heating, ventilation, cooling, and lighting systems. In addition, the company offers renewable energy solutions and services, such as the construction of small-scale plants that the company owns or develops for customers that produce electricity, gas, heat, or cooling from renewable sources of energy and O&M services; and electricity, processed renewable gas fuel, and heat or cooling produced from renewable sources of energy. Further, the company sells photovoltaic (PV) solar energy products and systems, as well as provides consulting, and enterprise energy management services; and operates wind farms. It serves the federal, state, local governments, healthcare and educational institutions, airports, public housing authorities and public universities, municipal utilities, and commercial and industrial customers. As of December 31, 2023, the company owned and operated 185 small-scale renewable energy plants and solar PV installations. Ameresco, Inc. was incorporated in 2000 and is headquartered in Framingham, Massachusetts.
Robust Profitability Expansion: Adjusted EBITDA increased 32% to $40.6 million in Q1 2025, reflecting strong operational execution and improved earnings quality
Significant Backlog Growth: Contracted project backlog surged 78% year-over-year to $2.6 billion, substantially enhancing future revenue visibility and business resilience
Weak Operating Cash Flow: Cash flow from operating activities was negative at $(28.3) million, before adjustments for Federal ESPC project proceeds, indicating challenges in cash generation from core operations
Net Loss in the Quarter: The Company reported a net loss of $5.5 million attributable to common shareholders, highlighting continued bottom-line pressure
Ameresco faces heightened exposure to regulatory and tariff changes that could increase costs and extend project timelines despite its mitigation strategies
| Entry Price | Support* | Target 1** | Target 2** |
|---|---|---|---|
| 16.41 | 14.0 | 17.2 | 18.0 |
Data Source: REFINITIV, Analysis: StockNextt
*Support can be considered as an indicative stop-loss, and if prices move below that level on closing basis individuals may evaluate exiting the position depending on their risk appetite, previous holdings, and other factors considered. The support and resistance levels may need to be re-evaluated within 4-6 weeks’ time frame depending on the stock price movements from the date of recommendation on the stock.
**Target prices may vary by ±0.5% depending on market volatility.
Strong Start to 2025 with Solid Revenue and EBITDA Growth: Ameresco, Inc. reported an 18% year-over-year increase in total revenue for the first quarter of 2025, reaching USD 352.8 million. This performance was supported by robust growth across the Company’s Projects and Energy Asset businesses. Adjusted EBITDA rose by 32% to USD 40.6 million, demonstrating effective cost management and operational efficiency. The Company attributed the revenue increase primarily to a 23% rise in Projects revenue and a 31% rise in Energy Asset revenue compared to the prior-year period.
Expansion of Backlog and Revenue Visibility: Ameresco significantly strengthened its future revenue prospects with notable increases in project backlog and visibility. The contracted project backlog reached USD 2.6 billion, representing a 78% increase over the previous year, while total project backlog grew 22% to USD 4.9 billion. The Company also reported total revenue visibility of approximately USD 9.6 billion, driven by strong contract conversions, awarded backlog additions of over USD 367 million, and the deployment of new energy assets.
Resilience in Federal and Tariff-Related Dynamics: The Company reported no new cancellations or delays in its Federal contracts, with previously delayed or paused projects now progressing as planned. Additionally, Ameresco highlighted that it has limited near-term exposure to changing tariff dynamics as most equipment for ongoing projects has already been procured and delivered. The Company emphasized its experience in managing such external challenges, referencing its ability to navigate similar issues during the COVID-19 pandemic and prior tariff adjustments.
Segment Performance and Margin Considerations: In terms of segment performance, the Projects business contributed USD 251.5 million in revenue and USD 8.7 million in adjusted EBITDA, while Energy Assets generated USD 56.7 million in revenue and USD 30.1 million in adjusted EBITDA. The O&M segment saw a modest decline in revenue to USD 24.8 million and adjusted EBITDA of USD 1.7 million, while Other revenue fell to USD 19.8 million due to the sale of AEG at the end of 2024. The gross margin stood at 14.7%, consistent with expectations but reflecting a mix of lower-margin EPC revenue from the Company’s European joint venture.
Debt Profile and Cash Flow Position: Ameresco reported total corporate debt of USD 270.0 million as of March 31, 2025, representing a reduction that enhances its balance sheet flexibility. The Company’s energy asset debt totaled approximately USD 1.45 billion with an advance rate of 74% against its USD 1.96 billion energy asset book value. Adjusted cash from operations for the quarter was USD 1.4 million, and the Company maintained USD 71.6 million in unrestricted cash. The extension and expansion of its revolving credit facility and term loan with Bank of America provided added liquidity to support its growth.
Considering recent key business, financial updates, current trading levels, and key business risks, a ‘Buy’ recommendation has been given on Ameresco, Inc (NYSE: AMRC) at the current market price of USD 16.41, as on June 16, 2025 at 9:20 AM PDT.
Data Powered by EOD Historical Data (“EODHD”).
Sector: Industrials Industry: Engineering & Construction
| Company | Change (USD) | Price (USD) | Trailing PE (x) | Forward PE (x) | Price Sales TTM (x) | Price to Book Value (x) | Enterprise Value to Revenue (x) | Enterprise Value to EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| AMRC Ameresco Inc |
0.81 2.65% | 31.38 | 26.59 | 17.04 | 0.85 | 1.52 | 1.81 | 17.24 |
| VCISF VINCI SA |
- -% | 141.49 | 14.66 | 12.94 | 1.06 | 2.37 | 1.40 | 8.24 |
| VCISY Vinci SA ADR |
0.10 0.28% | 36.14 | 14.51 | 12.97 | 1.07 | 2.38 | 1.40 | 8.26 |
| LTOUF Larsen & Toubro Limited |
- -% | 47.54 | 40.39 | 28.41 | 0.03 | 6.23 | 0.03 | 0.25 |
| PWR Quanta Services Inc |
10.28 2.15% | 488.05 | 45.64 | 24.88 | 1.58 | 5.17 | 1.79 | 20.64 |
Data Powered by EOD Historical Data (“EODHD”).
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.
Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.
Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on June 16, 2025. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned has been achieved and is subject to the factors discussed above.
Note 4: StockNextt reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Target: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Target 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Target 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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