Arcadis 3Q25 broadly in line, no room for upgrades, TP reached & downgrade
Arcadis' 3Q25 trading update was broadly in line. Revenues were up organically by 1% (-4.3% FX impact) and landed at €936m (vs. our €939m (+1.2%) and CSS of € 962m (+1.6%)). Operating EBITA stood at €108m in line with our €110m estimate and slightly below €112m CSS. Posted margins are up 20bps in spite of limited revenue growth. Some €7m non operating costs hit the P&L linked to further restructurings in the UK & Australia. BtB of 0.94x (from 1.3x 3Q24) and BL of €3544m up 1.6% y/y org. but down -2.8% q/q. The numbers and outlook drawn confirm our scenario but leave little room for earnings upgrades. In such a context we see little triggers for a further reduction of the valuation discount versus peers, especially as the stock jumped >10% after announcing the unexpected €175m SBB early October. As our €51 target price was almost reached yesterday, we downgrade to Hold from Accum.Arcadis NV is a global asset design and consultancy company. The Company is engaged in providing consultancy, design, engineering and management services in the area of infrastructure, water, environment and buildings. The Company's segments include Americas; Europe and Middle East; Asia Pacific, and CallisonRTKL. Its business lines include infrastructure, water, environment and buildings. Infrastructure business line focuses on sustainable infrastructure solutions for transportation by road, rail, air and over water, and creating reliable energy supply systems. The Company is an environmental solutions provider to private industry, and delivers projects that protect the earth's resources. It offers water supply, treatment, management and conveyance solutions. The Company also offers contract solutions, master planning and sustainable urban development, commercially led program management, business advisory, data analysis and architecture and design solutions.
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