# AtkinsRéalis (ATRL)

Sector: Engineering services & nuclear

| Field | Value |
|---|---|
| Price | CA$86.01 |
| Fair value (Analysts) | CA$105.00 |
| Discount to fair value | 18.1% |
| Fair value uncertainty (Analysts) | Medium |
| Economic moat (Analysts) | None |
| LSEG analyst rating (1 strong buy to 5 strong sell) | 1.87 |
| Data as of | 2026-10-16 |
| Next earnings | 2026-11-05 (confirmed) |

## In short

The market doubts the pace of growth in engineering services and the timing of large CANDU contracts, and new nuclear orders with steady margins over the next year can close the gap.

## Themes and gap

- Themes: Power and energy (power-energy), AI disruption risk (ai-disruption)
- Gap type: Can close (closable)
- Why: The Q3 2026 report on November 5, 2026 and new CANDU contracts over the next year show whether nuclear growth and engineering margins continue.

## About

AtkinsRéalis is a Canadian engineering services and nuclear company with about 41,000 employees. Its Engineering Services Regions (Canada, the United Kingdom and Ireland, the United States and Latin America, and Asia, the Middle East and Australia) design and manage projects in transportation, water, energy, defence and buildings. Its Nuclear segment owns the CANDU reactor technology and provides reactor design, life extension, new build and services. It also has other segments, including Capital. Revenue was $3.0 billion (Canadian dollars) in Q2 2026, with Nuclear revenue of $671.2 million. In Q2 2025, it sold its remaining 6.76% interest in Highway 407 ETR for an after-tax gain of $2.2 billion, and it uses the cash for share buybacks and acquisitions.

## Thesis

The market doubts the pace of growth in engineering services and the timing of large CANDU contracts. In Q2 2026, organic revenue growth in Engineering Services Regions was only 2.2%, while Nuclear grew 18.1%. Total backlog fell to $20.2 billion at June 30, 2026, from $20.9 billion a year earlier, because Nuclear and Canada backlog fell. Investors also fear that AI tools can reduce the hours that clients pay for in design work. For the gap to close, three things must be true. Nuclear revenue must reach about $2.7 billion in 2026, as the company now expects, and new CANDU contracts must refill the Nuclear backlog. Engineering Services must keep its margin near the 16.4% Segment Adjusted EBITDA to net revenue ratio of Q2 2026 and return to faster organic growth. The company must keep returning cash through buybacks without adding much debt. The Q3 2026 report on November 5, 2026 gives the next test. New CANDU orders in Canada, Romania or the United States over the next year give the larger test. If these checks pass, the gap can close over the next four to six quarters. The main reason it may not close is a delay in large nuclear contracts, because governments decide their timing.

## Checkpoints

- Nov 5, 2026: Q3 2026 earnings: Nuclear and engineering margins. Status: Pending. Watch: Nuclear revenue on track for about $2.7 billion in 2026, faster organic growth in Engineering Services and steady margins pass; a cut in the outlook or a lower backlog fail.
- Q2 2027 (estimate): New CANDU contracts. Status: Pending. Watch: A new CANDU new-build or life extension contract in Canada, Romania or another country by mid-2027 passes; no new large nuclear award and a falling Nuclear backlog fail.

## Balance sheet

- Cash: CA$833M
- Debt: CA$696M
- Net cash: CA$137M
- EBITDA, last 12 months: CA$1.1B
- Undrawn credit line: CA$1.2B
- Last debt due: 2033

AtkinsRéalis has more cash than recourse debt. At June 30, 2026, recourse debt was $696.4 million (Canadian dollars), made of the new Series 9 and Series 10 debentures, and cash was $833.0 million. Net limited recourse and recourse debt was minus $136.6 million, a negative ratio of 0.1 times adjusted EBITDA of $1,084.5 million for the 12 months to June 30, 2026. Cash fell from $1,156.5 million at December 31, 2025, mainly because of share buybacks of $325.8 million and acquisitions. The committed revolving facility of $1,250.0 million had $1,212.5 million unused. Its covenant requires net recourse debt to EBITDA of no more than 3.25 times. The debentures mature in June 2031 and March 2033.

As of 2026-06-30.

Sources:

- https://www.atkinsrealis.com/~/media/Files/A/atkinsrealis/investor-briefcase/en/2026/e_mda-q226.pdf
- https://www.newswire.ca/news-releases/atkinsrealis-reports-second-quarter-2026-results-893822144.html

## Recent events

- 2026-10-06: AtkinsRéalis said it will release its Q3 2026 results before the market opens on November 5, 2026, and hold its call that morning.
- 2026-08-06: AtkinsRéalis reported Q2 2026 results. Revenue rose 10.0% to $3.0 billion. Adjusted EBITDA was a quarterly record of $292.9 million, and adjusted diluted EPS rose 20% to $0.97. Net income attributable to shareholders was $95.7 million. Backlog was $20.2 billion. The company raised its 2026 Nuclear revenue outlook to about $2.7 billion from about $2.5 billion and kept its other targets.
- 2026-08-06: AtkinsRéalis returned $245.0 million to shareholders in Q2 2026, mostly through buybacks of $242 million. It announced the purchases of WGA and Coras Solutions in Australia and TOBIN in Ireland. The board kept the quarterly dividend at $0.02 per share. In the quarter, the company also issued $400 million of 4.411% Series 9 debentures due June 2031 and $300 million of 4.756% Series 10 debentures due March 2033, and it used the money to redeem its Series 7 and Series 8 debentures.
- 2026-03-13: The Toronto Stock Exchange approved the renewal of the company's normal course issuer bid. It allows the company to buy back up to 13,649,009 common shares for cancellation.

## Risks

- Medium: Large nuclear contracts depend on government decisions, which can be late. Nuclear backlog fell in the year to June 30, 2026. A delay in new CANDU orders slows growth in the most profitable segment.
- Medium: Organic growth in Engineering Services Regions was 2.2% in Q2 2026. Lower public spending, delayed projects or AI tools that reduce paid hours can slow this business further.
- Low: The company makes many small acquisitions under its Land and Expand strategy. If integration fails or it pays too much, returns fall. Acquisition and integration costs were $13.8 million in Q2 2026.
- Low: Cash fell from $1,156.5 million to $833.0 million in the first half of 2026 because of buybacks and acquisitions. More buybacks leave less cash for a weaker period.

## Links

- Page: https://picks.kamadorueda.com/company/ATRL/
- History of changes: https://picks.kamadorueda.com/company/ATRL/history/
- JSON with full history: https://picks.kamadorueda.com/data/company/ATRL.json

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