Stantec represents one of the highest-quality compounders in the industrial and infrastructure consulting sector. The company sits at the intersection of major long-term secular growth drivers, including government-backed water grid modernizations, global energy transition infrastructure, defense spending, and severe structural demand for mission-critical digital infrastructure like AI data centres. Because it provides specialized, high-intellectual-property engineering and architectural services rather than capital-intensive construction, the company generates exceptionally high returns for sahreholders.
The stock trades at 16.6 times the company’s forward earnings forecast. That’s an attractive valuation thanks to the company’s superior growth profile.
STANTEC INC. (Toronto symbol STN; www.stantec.com) is a leading seller of consulting, project-delivery, design and technology services.
The company tends to use acquisitions to spur its growth. It cuts the risk of this strategy by targeting smaller, easy-to-absorb firms. Moreover, sharing administrative expenses, financing and employee benefits among its businesses helps lower overall costs.
For example, in July 2025, Stantec paid $725.4 million for Page, a Washington D.C.-based provider of architectural and engineering services to clients in the U.S. and Mexico.
Meantime, Stantec has agreed to participate in the design and building of a new datacentre in Alberta for Meta Platforms Inc. (Nasdaq symbol META). Meta, the parent company of Facebook and Instagram, will spend $13 billion on this massive facility north of Edmonton; it will probably open in 2029.
Stantec has not yet said how much it will receive for its work. However, deals like this bolster the engineering firm’s reputation, particularly for its expertise with water management systems. Note: Meta plans to spend a further $60 million to upgrade local infrastructure such as roads and water systems.
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Stantec’s strategic acquisitions help power the latest results
Acquisitions helped lift Stantec’s revenue for the three months ended March 31, 2026, by 9.1%, to $1.69 billion from $1.55 billion a year earlier. However, that missed the consensus forecast of $1.72 billion. If you exclude new businesses, revenue increased 3.6%.
Also, earnings before unusual items rose 14.7%, to $1.33 a share (or a total of $152.2 million) from $1.16 a share (or $132.8 million). That beat the consensus estimate of $1.29 a share.
Stantec continues to win new orders, particularly for water management projects and building design. Its backlog at the end of the quarter was $9.0 billion, up from $8.0 billion a year earlier
For all of 2026, Stantec’s earnings should rise 17% to $6.20 a share, and the stock trades at an attractive 16.6 times that estimate. The $0.98 dividend yields 1.0%.
Recommendation in Dividend Advisor: Stantec Inc. is a buy.
