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North American Construction Group
(TSX:NOA)
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Rating:57Neutral
Price Target:
C$19.50
â–²(5.81% Upside)
Action:Reiterated
Date:08/19/26
The score is primarily held back by higher leverage and weak recent free-cash-flow conversion despite healthy operating cash flow and revenue growth. The earnings outlook is supportive (raised revenue guidance, maintained EBITDA/FCF guidance, record backlog), but elevated debt, interest costs, and higher capex temper the near-term risk/reward. Technically, the stock is trading below key moving averages, while valuation is reasonable with a moderate P/E and a ~2.5% yield.
Positive Factors
Backlog and Revenue Outlook
The raised revenue outlook and record backlog improve forward visibility, supporting sustained fleet utilization and resource deployment. A substantial contracted base can reduce reliance on winning new work each quarter and underpin growth over the next several months.
Negative Factors
Elevated Leverage
Higher debt following the IMC acquisition and equipment purchases reduces financial flexibility in a cyclical contracting business. Elevated leverage also increases dependence on successful integration and cash-flow delivery before balance-sheet capacity improves.
Read all positive and negative factors
Positive Factors
Negative Factors
Backlog and Revenue Outlook
The raised revenue outlook and record backlog improve forward visibility, supporting sustained fleet utilization and resource deployment. A substantial contracted base can reduce reliance on winning new work each quarter and underpin growth over the next several months.
Read all positive factors
North American Construction Group (NOA) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$496.29M
Dividend Yield2.6%
Average Volume (3M)97.93K
Price to Earnings (P/E)16.1
Beta (1Y)1.08
Revenue Growth7.11%
EPS Growth-9.71%
CountryCA
Employees693
SectorEnergy
Sector Strength52
IndustryOil & Gas Equipment & Services
Share Statistics
EPS (TTM)1.14
Shares Outstanding26,913,895
10 Day Avg. Volume73,097
30 Day Avg. Volume97,927
Financial Highlights & Ratios
PEG Ratio-0.59
Price to Book (P/B)1.24
Price to Sales (P/S)0.44
P/FCF Ratio-21.33
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$26.17Price Target Upside42.00% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)2.1
Revenue Forecast (FY)C$1.55B
North American Construction Group Business Overview & Revenue Model
Company Description
North American Construction Group Ltd. (NACG) specializes in providing heavy construction, mining, and equipment maintenance services across Canada, the United States, and Australia. Its Heavy Construction & Mining division undertakes a comprehens...
How the Company Makes Money
NOA makes money by contracting its heavy equipment fleet and operating workforce to customers (primarily resource operators) under service agreements to perform mining and heavy construction work. Revenue is generated when NOA delivers contracted ...
North American Construction Group Earnings Call Summary
Earnings Call Date:Aug 12, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive operational and strategic trajectory: material revenue growth, record backlog, successful IMC integration, and improved operating metrics supported a raised revenue guide and maintained EBITDA/FCF ranges. However, the quarter also showed notable financial trade-offs—an acquisition-driven rise in net debt and interest expense, higher sustaining/growth capital needs (particularly for oil sands), some missed bids, and indications that a portion of the revenue increase is flow-through with limited immediate margin uplift. On balance the company appears to be investing for sustainable growth while managing near-term cost and leverage implications.Positive Updates
Quarterly Revenue and Raised Full-Year Guidance
Combined revenue of $456 million in Q2 and a first-half foundation of over $875 million. Company raised full-year combined revenue guidance to $1.6 billion–$1.8 billion (midpoint $1.7 billion), $100 million above the prior midpoint and ~14% above full-year 2025.
Negative Updates
Increased Net Debt and Leverage
Net debt rose by $191 million to $1.1 billion, reflecting the IMC acquisition and growth equipment purchases. Trailing 12 net debt leverage reported at 2.9x (company states a 2.6x run-rate for H2 but not yet benefiting from 12 months of IMC EBITDA).
Read all updates
Q2-2026 Updates
Positive
Negative
Quarterly Revenue and Raised Full-Year Guidance
Combined revenue of $456 million in Q2 and a first-half foundation of over $875 million. Company raised full-year combined revenue guidance to $1.6 billion–$1.8 billion (midpoint $1.7 billion), $100 million above the prior midpoint and ~14% above full-year 2025.
Read all positive updates
Company Guidance
The company raised full‑year combined revenue guidance to $1.6–$1.8 billion (midpoint $1.7B) while maintaining adjusted EBITDA guidance of $380–$420 million (midpoint $400M) and free cash flow guidance of $110–$130 million (midpoint $120M); this outlook is supported by a record contractual backlog of ~$3.8B (Australia ~$3.4B plus a $3.9B AU bid pipeline), a total corporate bid pipeline >$12B with $3.6B active (≈$1.8B Australia / $1.8B North America), Q2 revenue of $456M and H1 revenue >$875M, Q2 adjusted EPS of $0.32, operating cash flow before working capital of $78M and Q2 free cash flow of $23M (after a $13M positive WC change). Financial posture: net debt rose $191M to $1.1B with trailing 12‑month leverage 2.9x (operating at ~2.6x on a second‑half run rate), senior secured debt steady at 1.7x, interest expense $18.9M and average cost of debt 6.4%; efficiency metrics include depreciation at 13% of revenue (down from 16%), direct adjusted G&A $15M (3.8% of revenue), a ~30% FCF conversion target, IMC representing ~15% of the business, total capex now a little north of $200M for 2026 (including ~$50M to drive oil sands fleet availability), and operational KPIs such as a targeted 70% mechanical availability in the oil sands, a 260‑unit multi‑life target fleet, Nuna fleet ~230 assets with ~20% site revenue growth expected, and margin/return targets of ~15% gross profit and IRRs >40%.North American Construction Group Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
44
Neutral
Cash Flow
56
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.34B | 1.28B | 1.17B | 957.22M | 769.54M | 654.14M |
| Gross Profit | 172.50M | 160.33M | 210.05M | 154.22M | 101.55M | 90.42M |
| EBITDA | 326.08M | 329.19M | 283.06M | 252.59M | 227.18M | 186.74M |
| Net Income | 32.35M | 33.83M | 44.09M | 63.14M | 67.37M | 51.41M |
Balance Sheet | ||||||
| Total Assets | 2.25B | 1.82B | 1.69B | 1.55B | 979.51M | 869.28M |
| Cash, Cash Equivalents and Short-Term Investments | 167.68M | 100.13M | 77.88M | 88.61M | 69.14M | 16.60M |
| Total Debt | 1.19B | 921.58M | 825.10M | 717.05M | 435.39M | 395.23M |
| Total Liabilities | 1.77B | 1.36B | 1.31B | 1.19B | 673.59M | 590.82M |
| Stockholders Equity | 480.24M | 456.62M | 388.90M | 356.65M | 305.92M | 278.46M |
Cash Flow | ||||||
| Free Cash Flow | 5.34M | -26.55M | -66.74M | 66.90M | 53.94M | 51.39M |
| Operating Cash Flow | 261.20M | 254.54M | 217.61M | 270.39M | 169.20M | 165.18M |
| Investing Cash Flow | -280.19M | -264.83M | -274.68M | -244.88M | -97.47M | -99.27M |
| Financing Cash Flow | 99.39M | 31.11M | 45.98M | -7.75M | -19.49M | -92.76M |
North American Construction Group Technical Analysis
Negative
18.43
Price Trends
19.03
Negative
19.19
Negative
19.59
Negative
Market Momentum
-0.26
Positive
44.60
Neutral
34.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:NOA, the sentiment is Negative. The current price of 18.43 is below the 20-day moving average (MA) of 19.02, below the 50-day MA of 19.03, and below the 200-day MA of 19.59, indicating a bearish trend. The MACD of -0.26 indicates Positive momentum. The RSI at 44.60 is Neutral, neither overbought nor oversold. The STOCH value of 34.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:NOA.
North American Construction Group Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | C$1.20B | 13.59 | 14.51% | 1.34% | 21.71% | 40.07% | |
71 Outperform | C$707.61M | 11.40 | 8.75% | 9.98% | -14.91% | 442.58% | |
70 Outperform | C$1.34B | 14.88 | 12.81% | 3.44% | 20.43% | -20.30% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
63 Neutral | C$119.38M | 30.06 | 4.32% | 130.90% | 28.46% | 41.76% | |
57 Neutral | C$496.29M | 16.11 | 7.40% | 2.60% | 7.11% | -9.71% |
* Energy Sector Average
TSE:NOA
North American Construction Group
18.44
0.33
1.80%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.