SNC-Lavalin Group Inc. (ATRL.TO) Buy, Sell or…

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SNC-Lavalin Group Inc. (ATRL.TO)

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86.79

+5.25 (6.44%)

as of Jun 19, 2026, 8:00:00 pm Market Open.

252 watching

DON'T BUY

He owns no engineering firms. SNC shares have bounced back upon news of a settlement. It has normalized back to $30. It likely won't rise much from here--it has settled. SNC has always traded at a high multiple for a cyclical business. He prefers Aecon, though is trading high as well. The space has run up recently, and these companies will benefit from Canadian infrastructure spending. But the optimism is already priced in.

COMMENT

Guilty on federal charges Corruption acquisitions were dropped following a guilty decision on fraud. The stock is up almost 25% at the moment.

DON'T BUY

Avoid. Too much negativity attached to this stock with the threat of criminal charges prevents them from bidding on new contracts. It takes time to get bad contracts out of their system and off their books. They need a plan to monetize their infrastructure assets to create shareholder value; for 10 years they've alluded to this plan but haven't done it. They're protected from takeover, because they're based in Quebec, but they suffer from poor governance.

COMMENT

Owns a little bit in their Canadian equity fund and debates every day whether to sell it. Sold a big chunk of the 407 which was their best asset. Not saying it can't rebound to $40, but this is a stock that hasn't made you money in 20 years.

DON'T BUY

He doesn’t really like it. They have looked into it, and value investors, it is a good candidate. However, they’ve avoided it due to all the controversy. There is a lot of uncertainty around the future. He would stay away.

DON'T BUY

A tricky one. His view is in flux. A tough company to analyze. Maybe now is a dead-cat bounce (snaps back after a heavy drop). What is this business really worth? In two parts. They have concessions like the 407 toll road worth a lot on its own. So you get the engineering/construction side for free, but this side of the operation has performed poorly. He's not convinced they've turned the ship around under the new CEO. There have been governance problems. A lot of hair on this stock.

DON'T BUY

It's bounced back from depressed levels, and enjoyed a decent quarter. They;ve been penalized for cost overruns, so it's important how they execute on current fixed-price contracts. They also are battling a lawsuit that may go to court in 2020--she's watching this.

DON'T BUY

The results were half decent and there were a lot of short sellers that may have had to cover. It is hard to value as there is a lot of uncertainty. They have a lot of debt, and profit is very volatile. They have proven that they are not good operators on the engineering and construction side.

DON'T BUY

Other companies have gotten into trouble bidding on these large contracts. They got rid of part of the 407, which was their cash cow because they needed cash. They still have a stake, however. This whole global engineering space is hard to predict. It is so hard to know if these large companies underbid on these large contracts then 3 years later find they lost money on them.

DON'T BUY

They have a number of huge problems, including the threat of class-action litigation and official prosecution. The contracting business does not seem to be able to make money. The assets are worth more than $16 per share. The issue becomes what is your appetite to accept other people's problems. He does not know if this is the time to buy. It could be the falling knife. He is nervous about it and is not buying.

WAIT

Lower lows, lower highs. Not something he wants to be involved in yet. Signs of positive divergences. Spring is opportune time to get in.

WATCH

They got a reprieve when there was a large shareholder who injected cash. The engineering world is still going through some strife and of course there is the political issues around them. He would wait and see what the litigation will hold.

DON'T BUY

A classic value trap for several years. It has several issues, starting with a leadership void. They hold some great infrastructure assets, so there's some value here. But there is so much opposition to unlock that value. They got into some political trouble. Avoid.

RISKY

Why the big rally lately? Lots of volatility here. The problem is trying to understand the core business strategy. They used to do a "turnkey" construction business, with a fixed cap on construction costs -- moving towards cost plus instead. Now, with recent asset write downs, he is having a hard time value the underlying business as it changes strategy. He expects further write downs. He would like to see them de-risk things before coming back in. A big shareholder has come in recently to help recapitalize them. A speculative buy at this stage, but he is not back in.

WATCH

A good time to consider to buy more right now. The stock could be wroth $30 but a lot of things have to go right. They just sold a stake in the 407. They could sell the rest that can bring in money. They also made a valuable acquisition. There is risk of whether they can bid on contract. High risk, high reward.

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SNC-Lavalin Group Inc. (ATRL.TO)