Arcosa, Inc. (ACA) vs Legence Corp. (LGN)

Arcosa, Inc. and Legence Corp. are both Engineering & Construction companies. Arcosa, Inc. is the larger, with a market value of $7.2B against $5.7B — 1.3× the size. Legence Corp. has negative trailing earnings, so its P/E is not meaningful; Arcosa, Inc. trades at 14.7×. Arcosa, Inc. has the higher net margin (16.8% vs −1.20%) and the higher return on invested capital (5.49% vs 1.07%). Across the 17 metrics below, Arcosa, Inc. leads on 12 and Legence Corp. on 5.

Valuation

Metric ACA LGN Engineering & Construction median
P/E 14.66 n/m 28.59
P/S 2.47 1.07 1.15
P/B 2.41 4.08 3.96
Price to free cash flow 38.23 12.34 25.24
EV/EBITDA 14.17 21.44 14.87
EV/Sales 2.81 1.26 1.42
Earnings yield 6.82% (1.28%) 2.47%
Free cash flow yield 2.62% 8.10% 1.91%

Profitability

Metric ACA LGN Engineering & Construction median
Gross margin 22.80% 18.74% 18.76%
Operating margin 12.00% 0.79% 6.26%
Net margin 16.84% (1.20%) 2.23%
Free cash flow margin 6.45% 8.64% 1.83%
Return on equity 17.90% (7.63%) 7.90%
Return on assets 9.53% (2.41%) 0.87%
Return on invested capital 5.49% 1.07% 2.52%

Growth

Metric ACA LGN Engineering & Construction median
Revenue growth (TTM) 16.67% — 16.67%
EPS growth (last fiscal year) 121.99% — —
Revenue growth, 5-year CAGR 8.30% — 11.76%
Net income growth, 5-year CAGR 14.35% — 0.00%

Health

Metric ACA LGN Engineering & Construction median
Debt to equity 0.48 1.06 0.40
Current ratio 3.12 1.35 1.39
Net debt to EBITDA 2.32 2.93 0.38

Dividend

Metric ACA LGN Engineering & Construction median
Dividend yield 0.24% — 0.65%
Payout ratio 0.03 — 0.00

Size

Metric ACA LGN Engineering & Construction median
Market cap 7.20b 5.67b 1.31b

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