Canadian Investors: Buy the World’s Top Infrastructure Company

SNC-Lavalin Inc. (TSX:SNC) operates a resources service business and is actively working with clients to design clean energy solutions and meet carbon-reduction targets.

| More on:
Construction work on a site

Image source: Getty Images

SNC-Lavalin (TSX:SNC) operates a resources service business and is actively working with clients to design clean energy solutions and meet carbon-reduction targets. SNC-Lavalin is the engineer and integrator for HyNet, the world’s first low carbon hydrogen project located in the northern United Kingdom, and this year, the company delivered designs for three offshore wind projects in northern Europe.

Broad, end-to-end capabilities and integrated approach to sustainability

The project, however, that perhaps best showcases SNC-Lavalin’s broad, end-to-end capabilities and integrated approach to sustainability is Montreal’s Réseau express métropolitain, or REM. The latest in a long track record of signature light-rail transit projects that SNC-Lavalin has helped to design, build, operate and maintain, the 67-km REM is the largest public transit project of the past 50 years in Quebec. An electric and fully automated network that will connect the Montreal region, it is being designed and built using advanced digital solutions and offsite modular manufacturing of the line’s 26 stations.

Complex and leading-edge projects

SNC-Lavalin’s work on complex, leading edge projects like REM continues to garner the company a number of awards, including the prestigious Schreyer Award and Award of Excellence for the highest degree of technical merit at the 2020 Canadian Consulting Engineering Awards for the company’s work on the Samuel De Champlain Bridge. Atkins, an SNC-Lavalin Group company, was also recognized with a 2020 Hong Kong Institution of Engineers Innovation Award for the company’s cofferdam design work on the world’s longest and largest subsea road link between Hong Kong and Macau.

Refocus the business on engineering services

In short, SNC-Lavalin has much to look forward to. The company’s decision in 2019 to refocus the business on engineering services and exit lump-sum turnkey construction contracting (LSTK) was clearly the right one, as engineering services have proven resilient through the pandemic with a robust pipeline of new business as the company heads into 2022.

Leveraging digital capabilities as part of a more integrated focus on sustainable infrastructure development

Further, SNC-Lavalin continued to reduce the LSTK backlog by $800 million as of the end of the second quarter of fiscal 2021. SNC-Lavalin is working with the company’s partners to develop new, more collaborative contracting models, which will allow the industry to more fully leverage digital capabilities as part of a more integrated focus on sustainable infrastructure development.

Providing solutions to the world’s most pressing challenges

That foundation positions SNC-Lavalin well, as the company looks to provide solutions to the world’s most pressing challenges. It also allows SNC-Lavalin to contribute and give back to the company’s communities in other ways. Earlier this month, SNC-Lavalin announced a donation to two leading hospital foundations: the McGill University Health Centre (MUHC) and the Montreal Children’s Hospital Foundations.

Strong tailwinds and bright future outlook

That is in addition to other contributions, including donating to Feeding America, the largest hunger-relief network in the United States, and supporting St. Mary’s Hospital in London in the United Kingdom. SNC-Lavalin is also supporting oil and gas multinational BP in ambitious carbon-reduction efforts. Overall, SNC-Lavalin’s has some pretty strong tailwinds and could outperform the general market over the next decade.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

The Motley Fool has no position in any of the stocks mentioned. Fool contributor Nikhil Kumar has no position in any of the stocks mentioned. 

More on Investing

Young adult woman walking up the stairs with sun sport background
Dividend Stocks

Beginning Investors: 3 TSX Stocks I’d Buy With $500 Right Now

These TSX stocks are easy to follow and high-quality companies you can commit to owning long term, making them some…

Read more »

Person holds banknotes of Canadian dollars
Dividend Stocks

TFSA Passive Income: Earn Over $600 Per Month

Here's how Canadian investors can use the TFSA to create a steady and recurring passive-income stream for life.

Read more »

grow dividends
Dividend Stocks

2 Top TSX Dividend Stocks With Huge Upside Potential

These top dividend stocks could go much higher in 2025.

Read more »

Canadian Red maple leaves seamless wallpaper pattern
Dividend Stocks

Canadian Tire is Paying $7 per Share in Dividends – Time to Buy the Stock?

Canadian Tire stock (TSX:CTC.A) has one of the best dividends in the business, with a dividend at $7 per year.…

Read more »

gaming, tech
Tech Stocks

Should You Load Up on Spotify Stock?

Spotify shares (NYSE:SPOT) surged on earnings, leaving investors to wonder whether they've missed the boat on this growth stock.

Read more »

edit Sale sign, value, discount
Investing

3 Growth Stocks Available at a Great Discount

Given their healthy long-term growth prospects and discounted stock prices, these three stocks look like appealing buys.

Read more »

Businessperson's Hand Putting Coin In Piggybank
Dividend Stocks

How to Earn $480 in Passive Income With Just $10,000 in Savings

Want to earn some passive income from your savings. Here's how to earn nearly $500 per year from a $10,000…

Read more »

money while you sleep
Investing

Where Will Fairfax Financial Stock Be in 5 Years?

Fairfax Financial Holdings (TSX:FFH) stock looks like a bargain after its latest acquisition!

Read more »