Bird Construction: A Fortress of Sector Leadership in a Growing World

The construction sector is rarely seen as a bastion of stability, but Bird Construction Inc. (BCI) is defying expectations. With a record $4.3 billion contracted backlog as of Q1 2025—up 16.4% from the prior quarter—and a pipeline of $525 million in new contracts announced since March, BCI is positioned as a leader in infrastructure, defense, and net-zero energy projects. These sectors are primed to boom amid urbanization, geopolitical shifts, and decarbonization mandates. Investors who act now could capitalize on a stock that’s up 21% year-to-date but remains undervalued relative to peers.

Why BCI’s Backlog Matters
Bird’s backlog isn’t just a number—it’s a roadmap to future revenue. The company’s Q1 wins include:
- $500 million+ in infrastructure projects, including the East Harbour Transit Hub (a 50/50 joint venture with Metrolinx) and civil work for the Government of British Columbia.
- $140 million in defense contracts, such as 200 new housing units for Canadian Armed Forces personnel.
- $180 million in net-zero energy projects, including expansions at Dow’s Path2Zero site and Woodfibre LNG.
- $75 million in long-term care facilities, such as a multi-phase BC care center renovation.

This diversification is no accident. BCI’s strategy of targeting ESG-aligned projects (net-zero energy), high-margin defense work, and critical infrastructure ensures resilience in volatile markets.

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Tailwinds from Secular Trends
1. Infrastructure Boom: Governments worldwide are pouring trillions into roads, transit, and energy grids. In Canada alone, federal spending on public transit and broadband could hit $100 billion by 2030. Bird’s backlog includes projects like the East Harbour Hub, which fits perfectly into this trend.

1. Defense Spending Surge: Global defense budgets are rising, with Canada’s increasing by 15% over five years. BCI’s defense contracts—like its housing projects—tap into this demand, offering recurring revenue through master service agreements.

2. Decarbonization Push: The net-zero transition is creating demand for projects like LNG facilities and industrial decarbonization. Bird’s work with Dow and Woodfibre positions it as a partner to energy giants betting on cleaner infrastructure.

3. Aging Populations Needing Care: North America’s demographic shift is driving demand for long-term care facilities. Bird’s $75 million in recent wins here signal a growing niche.

Why the Stock is Undervalued
Despite its 21% YTD rise, Bird trades at a 12.5x forward P/E ratio, below peers like Quebecor (QBRBF) at 14.8x or BCE (BCE) at 16.2x. This discount ignores Bird’s:
- Margin Expansion: Adjusted EBITDA rose 41% to $34.1 million in Q1, with margins hitting 4.8%—up from 3.5% a year earlier.
- Strong Balance Sheet: $137.8 million in cash and $336.7 million in credit facility headroom provide fuel for acquisitions or share buybacks.
- Dividend Consistency: A monthly $0.07 dividend since 2018, with payouts covering just 33% of earnings, leaving room to grow.

Risks? Yes—but Manageable
Supply chain bottlenecks and project delays are risks, but Bird’s backlog includes collaborative contracts (e.g., joint ventures with public agencies) that reduce execution risk. Its liquidity also buffers against inflationary pressures.

The Case for Immediate Action
Bird Construction is a rare blend of sector leadership, diversified backlog, and valuation upside. With secular trends favoring its core markets and a stock that’s lagging peers, now is the time to buy. The $4.3 billion backlog ensures visibility through 2026, while its ESG focus and defense wins position it to outperform as global spending accelerates.

Investors, Take Note:
- Buy now before the market fully prices in its backlog-to-revenue conversion.
- Hold for the long term: Bird’s strategic bets align with 10-year trends in infrastructure, defense, and energy.

In a world hungry for construction that’s sustainable, secure, and scalable, Bird isn’t just building projects—it’s building a fortress of future earnings.