# Balfour Beatty (BBY.LSE)

Canonical: https://gigainvestors.com/s/BBY.LSE

Analysis as of: 2026-10-16T07:37:29.054Z. Financial observations: FY1996–FY2025.

Listing currency: GBX. Reporting currency: GBP.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: GBX 823.50 per share; close as of 2026-10-15.

Estimated value: low GBX 1,066.50 per share, central GBX 1,157.88 per share, high GBX 1,279.53 per share. Buy at or below the central value GBX 1,157.88 per share. Valuation as of 2026-10-16T07:37:29.054Z; scenarios are not confidence intervals.

Expected annual return: 15.9% at the stated quote. About 15.9% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; GB 10-year bond 5.4% + 4 points).

## Checklist

### understandable: fail

- 4 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 0

- Operating margin variation: 0.46×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.00×

- FY2017: 0.02×

- FY2018: 0.02×

- FY2019: 0.02×

- FY2020: 0.01×

- FY2021: 0.01×

- FY2022: 0.04×

- FY2023: 0.03×

- FY2024: 0.02×

- FY2025: 0.02×

### moat: fail

- Years with nonpositive invested capital use equity plus debt and leases; positive earnings with no positive capital are shown above 100%.

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 31.8%

- ROIC, second-lowest year: 7.0%

- Typical minus recent gross margin: 0.3 pp

- Typical gross margin (annual median): 5.1%

- Recent gross margin (lower of latest and 3-year median): 4.8%

- Years with nonpositive capital: 3

- Capital spending / revenue: 0.5%

- ROIC including acquisitions, ten-year median: 16.2%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 0.7%

- FY2017: 53.0%

- FY2018: 36.2%

- FY2019: 27.4%

- FY2020: 10.6%

- FY2021: 72.4%

- FY2022: >100%

- FY2023: 7.7%

- FY2024: >100%

- FY2025: 7.0%

### economics: pass

- Owner earnings / net income, 5-yr: 1.21×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: GBP 1.3B

- Net income, five-year total: GBP 1.1B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: 0.4 pp

- Working capital / revenue, change between three-year averages: 3.2 pp

- Working capital / revenue, final three-year average: 8.8%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.33×

- FY2022: 1.18×

- FY2023: 1.10×

- FY2024: 1.39×

- FY2025: 1.13×

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 36.2% vs 7.7%

- Per-share earnings: 0.03 to 0.35 (three-year endpoint medians)

- acquired goodwill and intangibles (proxy) exceeds half of ten-year net income with low and deteriorating ROIC

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -3.0%

- Ordinary dilution, 5-year annual growth: -6.4%

- Market cap gain: GBP 1.7B

- Cumulative retained earnings: GBP 525M

- Diluted shares, 10-year annual growth: -3.0%

- Diluted shares, 5-year annual growth: -6.4%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 33.4%

- Per-share value change: GBP 0.31

- Per-share value, starting three-year median: GBP 0.03

- Per-share value, ending three-year median: GBP 0.35

- Buybacks concentrated in cheaper years (correlation): 0.42

- Average buyback yield: 4.2%

- Buyback history: 10 years

- Debt-funded buybacks: Yes

- Acquisition spending: GBP 1.0B

- Cumulative net income, 10 years: GBP 1.6B

- ROIC, first three-year median: 36.2%

- ROIC, last three-year median: 7.7%

Chart: Earnings per share; fiscal year observations.

- FY2016: GBP 0.03

- FY2017: GBP 0.24

- FY2018: GBP 0.20

- FY2019: GBP 0.19

- FY2020: GBP 0.04

- FY2021: GBP 0.20

- FY2022: GBP 0.47

- FY2023: GBP 0.35

- FY2024: GBP 0.34

- FY2025: GBP 0.53

### accounting: pass

- Sloan accruals: -7.0%

- Receivables to sales index (DSRI): 0.93×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 2.3%

- Earnings backed by cash: Yes

- Operating cash / earnings: 2.63×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.94×

Chart: Sloan accruals; fiscal year observations.

- FY2016: 3.3%

- FY2017: 2.7%

- FY2018: 5.8%

- FY2019: -1.7%

- FY2020: -5.2%

- FY2021: -4.4%

- FY2022: 2.3%

- FY2023: -1.7%

- FY2024: -1.5%

- FY2025: -7.0%

## Holders

## Price story

Price needs cash profits to shrink 6.5% a year for ten years · sales +15.2%

Story as of 2026-10-16T10:00:09.126Z; price observation 2026-10-15.

Price needs cash profits to shrink 6.5% a year for ten years

- 2025-08-13: Balfour Beatty profits lift as it eyes boost from UK construction projects ([uk.finance.yahoo.com](https://uk.finance.yahoo.com/news/balfour-beatty-profits-lift-eyes-111924661.html))

- 2026-08-12: Balfour Beatty shares jump as profit and cash guidance hiked ([uk.finance.yahoo.com](https://uk.finance.yahoo.com/news/balfour-beatty-shares-jump-profit-121713498.html))

### Sales · FY2024–2025

sales +15.2%; source https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml; observed 2026-04-07.

- FY2016: GBP 6.9B 

- FY2017: GBP 6.9B 

- FY2018: GBP 6.6B 

- FY2019: GBP 7.3B 

- FY2020: GBP 7.3B 

- FY2021: GBP 7.2B 

- FY2022: GBP 7.6B 

- FY2023: GBP 8.0B 

- FY2024: GBP 8.2B 

- FY2025: GBP 9.5B 

### Gross margin · FY2025

gross margin 4.8%; source https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml; observed 2026-04-07.

- FY2016: 4.1% 

- FY2017: 5.1% 

- FY2018: 5.6% 

- FY2019: 5.1% 

- FY2020: 3.2% 

- FY2021: 4.7% 

- FY2022: 5.5% 

- FY2023: 5.2% 

- FY2024: 5.1% 

- FY2025: 4.8% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in engineering & construction; annual sales are GBP 9.5 billion.

- Source: https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml (filed 2026-04-07); FY2025: revenue 9489000000; grossProfit 453000000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 4.8% to 5.2% during 2023–25; it earns 31.8% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2023: grossProfit / revenue = 5.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2024: grossProfit / revenue = 5.1%.

- Source: https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml (filed 2026-04-07); FY2025: grossProfit / revenue = 4.8%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); 10-year return on capital observations [[2016,0.0069672131147540985],[2017,0.5304659498207885],[2018,0.3620689655172414],[2019,0.2736413043478261],[2020,0.1060880829015544],[2021,0.7238805970149254],[2022,4.508196721311475],[2023,0.07699049797244938],[2024,1.6732232123451423],[2025,0.07018687340805983]]; median 0.3178551349325337. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

Kept about a 6% gross margin through 2022 cost inflation.

- Source: https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml (filed 2026-04-07); Gross margin observations: [[2021,0.046514856984171064],[2022,0.05518416568357583],[2023,0.051545101964218694]]; range within 2 percentage points.

### Where the cash goes

Paid dividends in 10 of 10 years; bought back GBP 157 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2016: growth capex 0; upkeep 41000000; owner earnings 34000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2017: growth capex 0; upkeep 20000000; owner earnings 199000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2018: growth capex 0; upkeep 38000000; owner earnings 146000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2019: growth capex 0; upkeep 75000000; owner earnings 122000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2020: growth capex 0; upkeep 66000000; owner earnings 38000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2021: growth capex 0; upkeep 37000000; owner earnings 186200000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2022: growth capex 0; upkeep 32000000; owner earnings 340600000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2023: growth capex 0; upkeep 66000000; owner earnings 216400000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); FY2024: growth capex 0; upkeep 28000000; owner earnings 246600000. Growth capex / owner earnings = 0.

- Source: https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml (filed 2026-04-07); FY2025: growth capex 0; upkeep 49000000; owner earnings 297400000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); Dividend observations: [[2016,18000000],[2017,32000000],[2018,39000000],[2019,48000000],[2020,6000000],[2021,29000000],[2022,58000000],[2023,58000000],[2024,61000000],[2025,64000000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml (filed 2026-04-07); FY2025: cash repurchases 157000000 GBP.

### Are managers owners

Insiders own 1.4% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); BBY.LSE SharesStats.PercentInsiders = 1.407 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits shrink 6.5% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-04-07); Ten-year compound average after fade. Initial solved rate -0.10371857292928804. Price 823.5; FX 100; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share -0.2676470588235294 → FY2025 0.5953512952994473. Closing-price date 2026-10-15.

## Monthly share-price history (GBX per share)

- 2016-10: GBX 271.00 per share

- 2016-11: GBX 267.70 per share

- 2016-12: GBX 268.90 per share

- 2017-01: GBX 258.50 per share

- 2017-02: GBX 276.60 per share

- 2017-03: GBX 269.40 per share

- 2017-04: GBX 291.80 per share

- 2017-05: GBX 281.80 per share

- 2017-06: GBX 270.60 per share

- 2017-07: GBX 264.00 per share

- 2017-08: GBX 268.90 per share

- 2017-09: GBX 269.20 per share

- 2017-10: GBX 274.00 per share

- 2017-11: GBX 264.80 per share

- 2017-12: GBX 297.00 per share

- 2018-01: GBX 282.50 per share

- 2018-02: GBX 265.20 per share

- 2018-03: GBX 267.60 per share

- 2018-04: GBX 294.20 per share

- 2018-05: GBX 305.60 per share

- 2018-06: GBX 283.70 per share

- 2018-07: GBX 293.60 per share

- 2018-08: GBX 289.70 per share

- 2018-09: GBX 274.10 per share

- 2018-10: GBX 263.10 per share

- 2018-11: GBX 251.00 per share

- 2018-12: GBX 249.30 per share

- 2019-01: GBX 274.00 per share

- 2019-02: GBX 288.00 per share

- 2019-03: GBX 262.10 per share

- 2019-04: GBX 251.20 per share

- 2019-05: GBX 237.60 per share

- 2019-06: GBX 242.00 per share

- 2019-07: GBX 206.00 per share

- 2019-08: GBX 215.60 per share

- 2019-09: GBX 222.00 per share

- 2019-10: GBX 225.40 per share

- 2019-11: GBX 220.80 per share

- 2019-12: GBX 261.40 per share

- 2020-01: GBX 265.80 per share

- 2020-02: GBX 246.20 per share

- 2020-03: GBX 216.60 per share

- 2020-04: GBX 259.60 per share

- 2020-05: GBX 250.60 per share

- 2020-06: GBX 260.80 per share

- 2020-07: GBX 240.60 per share

- 2020-08: GBX 223.00 per share

- 2020-09: GBX 223.60 per share

- 2020-10: GBX 213.60 per share

- 2020-11: GBX 255.40 per share

- 2020-12: GBX 270.20 per share

- 2021-01: GBX 269.20 per share

- 2021-02: GBX 275.40 per share

- 2021-03: GBX 295.20 per share

- 2021-04: GBX 312.00 per share

- 2021-05: GBX 310.80 per share

- 2021-06: GBX 306.60 per share

- 2021-07: GBX 303.00 per share

- 2021-08: GBX 286.00 per share

- 2021-09: GBX 271.00 per share

- 2021-10: GBX 254.00 per share

- 2021-11: GBX 233.80 per share

- 2021-12: GBX 262.00 per share

- 2022-01: GBX 251.60 per share

- 2022-02: GBX 239.80 per share

- 2022-03: GBX 257.00 per share

- 2022-04: GBX 242.80 per share

- 2022-05: GBX 260.40 per share

- 2022-06: GBX 254.20 per share

- 2022-07: GBX 280.60 per share

- 2022-08: GBX 315.20 per share

- 2022-09: GBX 306.40 per share

- 2022-10: GBX 298.60 per share

- 2022-11: GBX 323.80 per share

- 2022-12: GBX 337.60 per share

- 2023-01: GBX 366.40 per share

- 2023-02: GBX 364.80 per share

- 2023-03: GBX 372.40 per share

- 2023-04: GBX 383.00 per share

- 2023-05: GBX 367.20 per share

- 2023-06: GBX 340.80 per share

- 2023-07: GBX 349.40 per share

- 2023-08: GBX 327.20 per share

- 2023-09: GBX 321.00 per share

- 2023-10: GBX 309.20 per share

- 2023-11: GBX 325.20 per share

- 2023-12: GBX 331.20 per share

- 2024-01: GBX 332.00 per share

- 2024-02: GBX 339.40 per share

- 2024-03: GBX 382.20 per share

- 2024-04: GBX 363.80 per share

- 2024-05: GBX 371.40 per share

- 2024-06: GBX 365.20 per share

- 2024-07: GBX 421.20 per share

- 2024-08: GBX 419.00 per share

- 2024-09: GBX 430.80 per share

- 2024-10: GBX 444.80 per share

- 2024-11: GBX 450.40 per share

- 2024-12: GBX 454.80 per share

- 2025-01: GBX 465.20 per share

- 2025-02: GBX 464.40 per share

- 2025-03: GBX 434.00 per share

- 2025-04: GBX 457.60 per share

- 2025-05: GBX 499.80 per share

- 2025-06: GBX 522.00 per share

- 2025-07: GBX 543.00 per share

- 2025-08: GBX 593.50 per share

- 2025-09: GBX 647.00 per share

- 2025-10: GBX 672.00 per share

- 2025-11: GBX 704.00 per share

- 2025-12: GBX 711.00 per share

- 2026-01: GBX 714.00 per share

- 2026-02: GBX 759.50 per share

- 2026-03: GBX 756.00 per share

- 2026-04: GBX 816.00 per share

- 2026-05: GBX 796.50 per share

- 2026-06: GBX 867.50 per share

- 2026-07: GBX 862.50 per share

- 2026-08: GBX 884.50 per share

- 2026-09: GBX 922.00 per share

- 2026-10: GBX 823.50 per share

## Annual estimated value (GBX per share)

- FY2018: low GBX 128.93 per share, central GBX 136.08 per share, high GBX 145.61 per share

- FY2019: low GBX 285.01 per share, central GBX 311.67 per share, high GBX 347.16 per share

- FY2020: low GBX 285.32 per share, central GBX 311.83 per share, high GBX 347.13 per share

- FY2021: low GBX 380.58 per share, central GBX 415.25 per share, high GBX 461.42 per share

- FY2022: low GBX 466.14 per share, central GBX 507.35 per share, high GBX 562.22 per share

- FY2023: low GBX 623.21 per share, central GBX 678.46 per share, high GBX 752.00 per share

- FY2024: low GBX 681.12 per share, central GBX 745.31 per share, high GBX 830.76 per share

- FY2025: low GBX 956.17 per share, central GBX 1,041.91 per share, high GBX 1,156.04 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:43:12.125Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original ESEF filing](https://filings.xbrl.org/CT4UIJ3TUKGYYHMENQ17/2025-12-31/ESEF/GB/0/CT4UIJ3TUKGYYHMENQ17-2025-12-31/reports/CT4UIJ3TUKGYYHMENQ17-2025-12-31-T01.xhtml); period 2025-12-31, filed 2026-04-07.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.