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1. Company Snapshot

1.a. Company Description

ABM Industries Incorporated provides integrated facility solutions in the United States and internationally.The company operates through Business & Industry, Technology & Manufacturing, Education, Aviation, and Technical Solutions segments.It provides janitorial, facilities engineering, parking, custodial, landscaping and ground, and mechanical and electrical services; and vehicle maintenance and other services to rental car providers.


The company was incorporated in 1985 and is based in New York, New York.

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1.b. Last Insights on ABM

ABM Industries' recent performance was driven by strategic expansions, including semiconductor and fleet electrification wins. The company's ELEVATE plan and AI-driven acquisitions, such as the recent WGNSTAR acquisition, are expected to fuel revenue growth. A $35 million cost-cutting program and contract price escalations are anticipated to support margin improvement. Despite near-term margin pressure in manufacturing and aviation, Technical Solutions and AI initiatives are poised to drive long-term margin expansion, with a strong backlog and 16% projected EPS growth.

1.c. Company Highlights

2. ABM Industries' Q4 2025 Earnings: A Strong Finish to a Record Year

ABM Industries Incorporated reported a robust fourth quarter 2025, with record quarterly revenue of $2.3 billion, a 5.4% year-over-year increase driven by 4.8% organic growth. Adjusted EPS was $0.88, below analyst estimates of $1.09, while adjusted EBITDA margin was 5.6%. The company generated record annual revenue of $8.7 billion, a 5% increase over the previous year, and record new sales bookings of $1.9 billion, a 12% rise from 2024.

Publication Date: Dec -20

📋 Highlights
  • Record Quarterly Revenue:: Q4 2025 revenue hit $2.3 billion, up 5.4% YoY with 4.8% organic growth.
  • Strategic Acquisition:: Acquired WGNSTAR for technical workforce expansion, adding 1,300+ employees and boosting semiconductor sector presence.
  • 2026 Guidance:: Organic revenue growth of 3-4%, adjusted EPS $3.85-$4.15, and segment operating margin of 7.8-8%.
  • Share Repurchases:: $73 million spent in Q4, reducing shares by 4% annually, with $681.6 million in liquidity.
  • High-Margin Segment Performance:: Technical Solutions revenue surged 16% to $298.7 million with 12.4% operating margin.

Segment Performance

The company's segment performance was mixed, with B&I revenue up 2% to over $1 billion, and operating profit margin at 7.7%. Aviation revenue grew 7% to $296.7 million, with an operating profit margin of 5.7%. Technical Solutions revenue increased 16% to $298.7 million, with an operating profit margin of 12.4%. Education revenue rose 2% to $233.7 million, with an operating profit margin of 8%. These results demonstrate the company's diversified revenue streams and ability to grow across various segments.

Acquisition and Growth Prospects

The acquisition of WGNSTAR, a leading provider of managed technical workforce solutions, is expected to close in the first calendar quarter of 2026 and will contribute roughly 1 additional point of revenue growth. ABM expects organic revenue growth of 3% to 4% in fiscal 2026, with adjusted EPS in the range of $3.85 to $4.15. The introduction of a new metric, segment operating margin, is expected to be between 7.8% and 8% for fiscal 2026.

Valuation and Financial Health

With a P/E Ratio of 15.97 and EV/EBITDA of 9.97, the market appears to have priced in moderate growth expectations. The company's financial health is solid, with a total debt to pro forma adjusted EBITDA ratio of 2.7x and available liquidity of $681.6 million. Analysts estimate next year's revenue growth at 4.8%, which is slightly higher than the company's guidance. The company's share repurchase program has reduced its outstanding share count by 4% in fiscal 2025.

Outlook

ABM's strong Q4 2025 results and guidance for fiscal 2026 demonstrate the company's ability to drive growth through a combination of organic initiatives and strategic acquisitions. The WGNSTAR acquisition is expected to enhance ABM's technical capabilities and strengthen its position in the semiconductor sector. With a Dividend Yield of 2.51% and a Free Cash Flow Yield of 5.9%, the stock appears to offer a relatively attractive return profile.

3. NewsRoom

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ABM Industries Incorporated $ABM Shares Sold by Citigroup Inc.

Mar -08

Source: defenseworld.net

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ABM Industries (ABM) Q1 Earnings on the Horizon: Analysts' Insights on Key Performance Measures

Mar -05

Source: zacks.com

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ABM to Announce First Quarter 2026 Financial Results

Feb -24

Source: globenewswire.com

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ABM Banks on Multi-Year Strategic Plan ELEVATE Amid Macroeconomic Risk

Feb -13

Source: zacks.com

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Here's Why You Should Retain ABM Stock in Your Portfolio Now

Feb -11

Source: zacks.com

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Dividend Kings: No Ideal Buys In February's 57

Feb -10

Source: seekingalpha.com

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ABM Completes Acquisition of WGNSTAR, Strengthening Leadership in Semiconductor Technical Services

Feb -04

Source: globenewswire.com

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Critical Review: ABM Industries (NYSE:ABM) vs. BrightView (NYSE:BV)

Feb -01

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.56%)

6. Segments

Business & Industry

Expected Growth: 8.37%

ABM Industries Incorporated's 8.37% growth is driven by increasing demand for facilities management services, expansion into new markets, and strategic acquisitions. The company's diversified portfolio of services, including janitorial, parking, and landscaping, has enabled it to capitalize on growth opportunities in various industries, such as healthcare, education, and commercial real estate.

Manufacturing & Distribution

Expected Growth: 4.77%

ABM Industries' Manufacturing & Distribution segment growth of 4.77% is driven by increasing demand for outsourced facility services, strategic acquisitions, and expansion into high-growth markets. Additionally, the company's focus on technology-enabled services, such as IoT-based facility management, and its commitment to sustainability and energy efficiency also contribute to its growth.

Aviation

Expected Growth: 9.72%

The 9.72% growth in Aviation segment of ABM Industries Incorporated is driven by increasing air travel demand, expansion of airport infrastructure, and rising need for efficient facility management services. Additionally, the company's focus on sustainability and energy-efficient solutions, as well as its strategic acquisitions, contribute to the segment's growth.

Education

Expected Growth: 8.5%

ABM Industries Incorporated's 8.5% growth in Education segment is driven by increasing demand for facilities management services, expansion of existing contracts, and strategic acquisitions. Additionally, the company's focus on sustainability and energy-efficient solutions resonates with educational institutions, leading to new business opportunities and revenue growth.

Technical Solutions

Expected Growth: 4.83%

ABM Industries' Technical Solutions segment growth is driven by increasing demand for energy-efficient and sustainable solutions, expansion into new markets, and strategic acquisitions. Additionally, the company's focus on innovation, technology, and customer service has enabled it to capitalize on the growing trend of outsourcing facilities management services.

7. Detailed Products

Facilities Services

ABM Industries provides facilities services including janitorial, landscaping, and parking services to commercial, industrial, and institutional clients.

Aerospace & Defense Services

ABM provides specialized services to the aerospace and defense industries, including aircraft cleaning, maintenance, and support services.

Energy Solutions

ABM offers energy-efficient solutions, including energy audits, retrofits, and sustainability services to help clients reduce energy consumption and costs.

Technical Services

ABM provides technical services, including HVAC, electrical, and plumbing maintenance and repair services to commercial and industrial clients.

Aviation Services

ABM offers aviation services, including aircraft cleaning, catering, and ground handling services to airlines and airports.

8. ABM Industries Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

ABM Industries Incorporated operates in a industry with moderate threat of substitutes. The company's services are specialized, but there are alternative solutions available to customers.

Bargaining Power Of Customers

ABM Industries Incorporated has a diverse customer base, which reduces the bargaining power of individual customers. The company's services are also essential to its customers, making it difficult for them to switch to alternative providers.

Bargaining Power Of Suppliers

ABM Industries Incorporated has a moderate bargaining power of suppliers. The company relies on a network of suppliers for equipment, materials, and services, but it also has some flexibility to switch suppliers if necessary.

Threat Of New Entrants

ABM Industries Incorporated operates in an industry with high barriers to entry, making it difficult for new entrants to join the market. The company's established brand and customer relationships also make it challenging for new entrants to gain traction.

Intensity Of Rivalry

ABM Industries Incorporated operates in a highly competitive industry with many established players. The company must continually innovate and improve its services to maintain its market share and competitiveness.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 44.49%
Debt Cost 7.51%
Equity Weight 55.51%
Equity Cost 9.71%
WACC 8.73%
Leverage 80.15%

11. Quality Control: ABM Industries Incorporated passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Mueller Industries

A-Score: 6.4/10

Value: 4.3

Growth: 7.1

Quality: 7.9

Yield: 2.0

Momentum: 9.0

Volatility: 8.0

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Worthington Industries

A-Score: 5.3/10

Value: 3.9

Growth: 3.1

Quality: 5.9

Yield: 4.0

Momentum: 8.5

Volatility: 6.3

1-Year Total Return ->

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ABM Industries

A-Score: 5.1/10

Value: 6.1

Growth: 5.7

Quality: 5.4

Yield: 4.0

Momentum: 1.5

Volatility: 7.7

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Aramark

A-Score: 4.9/10

Value: 4.6

Growth: 5.9

Quality: 3.4

Yield: 2.0

Momentum: 5.0

Volatility: 8.3

1-Year Total Return ->

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UniFirst

A-Score: 4.6/10

Value: 5.7

Growth: 5.2

Quality: 6.2

Yield: 1.0

Momentum: 2.5

Volatility: 7.0

1-Year Total Return ->

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CBIZ

A-Score: 3.8/10

Value: 4.9

Growth: 5.2

Quality: 5.6

Yield: 0.0

Momentum: 1.0

Volatility: 6.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

42.0$

Current Price

42$

Potential

-0.00%

Expected Cash-Flows