Aecom (ACM) Balance Sheet

The balance sheet has shown remarkable stability, with total assets hovering around $12B and liabilities around $9.5B, indicating no major expansion or contraction. However, equity has declined from $2.5B in 2025Q4 to $2.2B in 2026Q3, reflecting the impact of the recent loss and possibly share repurchases. This stability may mask underlying earnings quality issues, as the equity decline aligns with the reported project-specific charge.

The D/E ratio has climbed steadily from 1.13 to 1.39 over the ten quarters, driven by a $600M increase in total debt while equity remained relatively flat. This suggests that the company is taking on more debt to fund operations or maintain liquidity, which may be a response to the recent earnings miss. The higher leverage, combined with thin margins, could amplify the impact of future cost overruns on equity.

The asset mix is heavily weighted towards goodwill and intangibles, with PPE essentially zero in the latest quarter, underscoring the professional services nature of the business. This structure implies that the company's value is tied to its brand and client relationships, but it also exposes the balance sheet to potential goodwill impairment if the recent operational issues persist. The absence of significant PPE suggests low capital intensity, but the goodwill concentration warrants monitoring for impairment risk.

The retained earnings deficit has widened by $500M over the period, reflecting the cumulative impact of losses, including the recent $86.7M net loss in 2026Q3. This suggests that the company has not been generating sufficient profits to offset historical losses, which may limit its ability to return capital to shareholders or invest in growth. The deficit also implies that equity is increasingly reliant on external capital, which could be a concern if leverage continues to rise.

The current ratio has declined from 1.17 in 2025Q3 to 1.06 in 2026Q3, and cash has decreased by $600M, indicating a reduced buffer against short-term obligations. This may be a result of the project-related cash outflows and the pause in buybacks, but it also suggests that the company is using cash to manage operations. With a current ratio barely above 1, ACM has limited room to absorb further shocks without tapping into its debt capacity.