The primary benchmark index for Canadian stocks continues to advance, notwithstanding the tariff headwinds. However, investors must still be cautious, not aggressive, despite the recent record closings. The current earnings season can help you pick stocks wisely and firm up investment decisions.
If I invest in the TSX this month, AtkinsRéalis Group (TSX: ATRL) in the industrial sector is my top value pick. On May 15, 2025, the $15.3 billion global engineering services and nuclear organization reported strong first-quarter 2025 financial results. Moreover, the record-high backlog and nuclear revenue during the quarter are buying signals.
Regarding stock performance, the year-to-date gain and one-year price return are 15.6%-plus and 67%-plus, respectively. Had you invested $6,800 a year ago, your money would be $11,356.09 today. Also, at $88.16 per share, the dividend offer is a modest but super safe 0.09% (4.6% payout ratio).
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Pivoting to growth
AtkinsRéalis has shifted its focus on Engineering Services and Nuclear as part of its “Pivoting to Growth” strategy (2022 to 2024). Management said the company has exceeded its organic growth, profitability, and leverage targets since 2021 and is well-positioned in fast-growing markets. It has the nuclear expertise to support and meet the global demand for low-carbon energy.
The period from 2025 to 2027 is the next phase of the growth journey. AtkinsRéalis plans to reinvest in the business, seek or pursue accretive acquisitions, and expand its global footprint. By utilizing the strong balance sheet and accelerating free cash flow (FCF), there should be ample investible funds for growth.
Financial highlights
In the three months ending March 31, 2025, total revenues and net income increased 12.4% and 51.9% to $2.6 billion and $69.1 million, respectively, versus Q1 2024. Ian L. Edwards, President and CEO of AtkinsRéalis, said, “We had a strong start to the year, as the energy transition and aging infrastructure continue fueling our markets, where our unique end-to-end engineering expertise positions us for sustained growth.”
According to Edwards, the Nuclear backlog rose above $5 billion for the first time in the company’s history. Nuclear revenue reached $538.3 million, representing an 80.3% year-over-year jump. At the quarter’s end, the total backlog is $20.2 billion, a 32.2% increase from a year ago.
In 2024, sustainable projects accounted for or generated 50% of the total revenues. Because of the strong demand and record backlog, management raised its nuclear revenue outlook for the full year 2025 to between $1.9 billion and $2 billion from $1.6 billion and $1.7 billion.
On May 16, 2025, Rio Tinto awarded AtkinsRéalis a seven-year contract for the comprehensive refurbishment of the Isle-Maligne hydropower plant in Alma, Quebec. The engineering, integrated procurement, and construction management services will extend the hydropower plant’s operational life for decades.
Engineer a better future.
“While market dynamics continue to evolve, our businesses have historically been resilient and successful during times of economic uncertainty,” Edwards added. AtkinsRéalis commits to executing its Delivering Excellence, Driving Growth strategy.
The company commits to engineering a better future by leading the way in nuclear innovation and environmental cleanup. Thus far in 2025, investors are happy with the industrial stock’s market-beating returns.
