Ferrovial, S.A. (FER.MC) | Investment Case

1. Company Snapshot

1.a. Company Description

Ferrovial, S.A., together with its subsidiaries, operates as an infrastructure and mobility operator in the United States, Poland, Spain, the United Kingdom, Canada, and internationally.The company engages in the design and construction of various public and private works; and development, finance, and operation of toll roads.Its construction activities include highways, tunnels, railways, bridges and viaducts, airports, intelligent toll systems, port and airport infrastructures, buildings, energy restoration, aqueducts, water treatment plants, desalination plants, digesters, thermal drying plants, chimneys and silos, caissons, storage tanks, solar power towers, oil facilities, and other construction.

The company is also involved in the operation and maintenance services of urban and industrial waste water treatment plants, and water treatment and desalination plants.In addition, it develops, manufactures, and markets asphalt and bitumen products; develops, finances, and operates airports; provides integrated solutions for the development and management of electrical transmission networks; provides mobility services, including ZITY, an electric carsharing service application; undertakes engineering works; and sells hydraulic equipment.The company was founded in 1952 and is based in Madrid, Spain.

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1.b. Last Insights on FER

Ferrovial's recent performance has been driven by several positive factors. The company has announced a second 2025 interim scrip dividend of €342 million, payable in cash or shares, which will likely appeal to shareholders. Additionally, analysts have upgraded their price target to €49.58, indicating increased optimism about the company's growth prospects. Ferrovial's involvement in innovative construction startups and its $825M I-95 project in South Carolina and Georgia demonstrate its commitment to expansion and infrastructure development.

1.c. Company Highlights

Last Price	56.46
Change Percentage	-0.53%
Open	56.82
Previous Close	56.76
Market Cap ( Millions)	40625
Volume	1702557
Year High	57.2
Year Low	36.3
M A 50	53.92
M A 200	46.65

FCF Yield	2.28%
Dividend Yield	1.40%
ROE	32.61%
Debt / Equity	175.30%
Net Debt / EBIDTA	731.22%
Price To Book	7.06
Price Earnings Ratio	21.33
Price To FCF	43.92
Price To sales	5.88
EV / EBITDA	46.89

2. Ferrovial's Q3 2025 Earnings: A Strong Performance

Ferrovial's financial performance in the first nine months of 2025 was robust, with revenue growing 6.2% and adjusted EBITDA increasing 4.8%. The company's EPS came out at 0.763, significantly beating estimates of 0.24. The highways division was a major contributor to this growth, driven by North American assets, particularly the 407 ETR in Canada, which saw traffic growth of 9.4% in Q3 and revenue up 18.6%. The company's net debt, excluding infrastructure projects, stood at negative EUR 706 million, reflecting strong cash generation and disciplined investment.

Publication Date: Oct -30

                                    📋 Highlights
                                    Highways Revenue & EBITDA Growth:
                                                North American assets drove 6.2% revenue and 4.8% adjusted EBITDA growth in the first 9 months 2025.
407 ETR Performance:
                                                Traffic rose 9.4% (Q3) and 6.2% (9 months), with revenue up 18.6% (Q3) and 19.3% (9 months); EBITDA surged 20.1% (Q3) and 15.8% (9 months).
Airports Progress:
                                                New Terminal One at JFK is 78% complete with 21 airline commitments; Dalaman Airport reported 2.9% revenue and 1.8% EBITDA growth in 9 months.
Construction Order Book:
                                                EUR 17.2 billion order book (up 9.1% from 2024 end) with 3.7% adjusted EBIT margin for the first 9 months 2025.
Financial Strength:
                                                Net debt (excluding infrastructure) at negative EUR 706 million; EUR 142 million spent on EUR 500 million share buyback, to be completed by 2026.

                                

Segment Performance

The Airports division saw steady performance, with Dalaman airport's revenue up 2.9% and EBITDA 1.8% in the first nine months. The Construction division delivered a 3.7% adjusted EBIT margin, with an order book of EUR 17.2 billion, up 9.1% from the end of 2024. The managed lanes business saw double-digit volume growth in Q3, driven by returns to office mandates, with the Texas managed lanes experiencing a positive effect due to traffic mix.

Outlook and Valuation

Ferrovial is optimistic about its prospects, with expectations of submitting bids for several North American highway projects in 2026. Analysts estimate revenue growth of 3.6% for next year. The company's valuation metrics indicate a P/E Ratio of 11.71, EV/EBITDA of 32.85, and a Dividend Yield of 1.49%. The ROIC is 14.4%, and ROE is 56.21%, indicating efficient capital allocation. The Net Debt / EBITDA ratio is 5.37, suggesting a manageable debt burden.

Key Highlights and Future Plans

Ferrovial's 407 ETR incentives are working well, promoting usage among infrequent users. The company is committed to returning EUR 500 million through a share buyback, with EUR 142 million spent so far, aiming to deliver on this commitment by the end of 2026. A new business plan is expected to be presented within the next 18 months. The company's strategy in data centers remains opportunistic, with a recent small acquisition adding capabilities to the Construction division.

3. NewsRoom

Ferrovial announces the dividend per share amount for the cash dividend announced on 25 November 2025

Dec -03

Source:

Ferrovial wins $721M in Texas water projects

Dec -03

Source:

Budimex completes $502m Warsaw West station reconstruction

Dec -01

Source:

Infrastructure construction projects are ‘becoming smarter,’ says Ferrovial Construction CEO

Nov -05

Source:

Ferrovial (BME:FER): Examining Valuation After Shares Gain 7% in the Past Month

Nov -04

Source:

Ferrovial announces a change in the dividend payment date

Nov -04

Source:

Ferrovial SE (FER) Q3 2025 Earnings Call Highlights: Strong Growth in North American Assets and ...

Oct -30

Source:

Highway Business Is Strong in North America, Says Ferrovial CEO

Oct -29

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.48%)

6. Segments

Construction

Expected Growth: 4.5%

Ferrovial SE's construction segment growth of 4.5% is driven by increased infrastructure investments, government projects, and a recovering European construction market. The company's diversified portfolio, strong project pipeline, and efficient project execution also contribute to this growth. Additionally, Ferrovial's expertise in sustainable and innovative construction solutions supports its expansion.

Toll Roads

Expected Growth: 3.8%

Ferrovial SE's toll roads segment growth of 3.8% is driven by increased traffic volume, higher toll rates, and strategic investments in road infrastructure. Strong economic conditions and government partnerships also contribute to the growth, with a focus on efficient operations and customer satisfaction.

Other

Expected Growth: 2.9%

Ferrovial SE's 'Other' segment growth of 2.9% is driven by increased construction activity, particularly in airports and highways, partly offset by lower energy services revenue. This growth is supported by the company's diversified portfolio and strategic investments in key markets, positioning it for long-term stability and expansion.

Unallocated Adjustments

Expected Growth: 0.0%

Unallocated adjustments from Ferrovial SE show 0.0% growth, driven by stable corporate costs and absence of significant one-off effects. This suggests that the company's central operations and overheads remain under control, with no major adjustments needed, resulting in a neutral impact on the financial performance.

Energy

Expected Growth: 6.2%

Ferrovial SE's energy segment growth of 6.2% is driven by increased investment in renewable energy projects, particularly wind and solar, as well as a focus on sustainable infrastructure development. Government policies supporting clean energy and a strong project pipeline contribute to this growth.

Airports

Expected Growth: 5.5%

Ferrovial SE's airport segment growth of 5.5% is driven by increasing air passenger traffic, driven by tourism and business travel, and efficient operations. The company's strategic focus on optimizing airport services, investing in digital transformation, and expanding capacity through smart investments also contribute to growth.

7. Detailed Products

Airport Services

Ferrovial SE's airport services include managing and operating airports, providing services such as security, ground handling, and retail management.

Highways and Motorways

Ferrovial SE's highways and motorways segment involves managing and operating toll roads, highways, and motorways.

Urban Services

Ferrovial SE's urban services segment involves providing waste collection, street cleaning, and other municipal services to cities.

Water Management

Ferrovial SE's water management segment involves providing services such as water treatment, supply, and distribution.

Rail and Metro

Ferrovial SE's rail and metro segment involves managing and operating rail and metro systems.

8. Ferrovial, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Ferrovial SE operates in the infrastructure and services sector, specifically in transportation, which has limited substitutes. The company's diversified portfolio across different geographies and sectors reduces the threat of substitutes.

Bargaining Power Of Customers

Ferrovial SE's customers include governments, private companies, and individuals. While some customers, such as governments, may have significant bargaining power, the company's diversified customer base and long-term contracts mitigate this risk.

Bargaining Power Of Suppliers

Ferrovial SE has a large and diversified supplier base, which reduces the bargaining power of individual suppliers. Additionally, the company has a strong track record of negotiating favorable contracts with its suppliers.

Threat Of New Entrants

The infrastructure and services sector has significant barriers to entry, including high capital requirements and regulatory hurdles. However, Ferrovial SE faces competition from established players and potential new entrants in specific markets.

Intensity Of Rivalry

Ferrovial SE operates in a highly competitive market with numerous established players. The company's main competitors include other large infrastructure and services companies, which increases the intensity of rivalry.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	65.50%
Debt Cost	4.31%
Equity Weight	34.50%
Equity Cost	8.92%
WACC	5.90%
Leverage	189.83%

11. Quality Control: Ferrovial, S.A. passed 2 out of 9 key points

Strong Liquidity

Low Deb

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Aena

A-Score: 7.5/10

Value: 6.7

Growth: 7.1

Quality: 8.2

Yield: 6.9

Momentum: 6.5

Volatility: 9.3

1-Year Total Return ->

Vinci

A-Score: 6.6/10

Value: 6.3

Growth: 6.2

Quality: 4.6

Yield: 6.9

Momentum: 6.0

Volatility: 9.3

1-Year Total Return ->

Ferrovial

A-Score: 6.1/10

Value: 2.4

Growth: 6.3

Quality: 6.6

Yield: 3.8

Momentum: 8.0

Volatility: 9.7

1-Year Total Return ->

Volvo

A-Score: 6.1/10

Value: 4.7

Growth: 6.4

Quality: 4.4

Yield: 9.4

Momentum: 5.0

Volatility: 6.7

1-Year Total Return ->

BAE Systems

A-Score: 5.7/10

Value: 2.4

Growth: 6.9

Quality: 4.8

Yield: 4.4

Momentum: 9.5

Volatility: 6.3

1-Year Total Return ->

Saint-Gobain

A-Score: 5.2/10

Value: 4.8

Growth: 5.8

Quality: 4.3

Yield: 4.4

Momentum: 6.5

Volatility: 5.7

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

8.57%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

5.90%

Ferrovial, S.A. - NL0015001FS8

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on FER

1.c. Company Highlights

Less Volatile

Expensive

Stable Momentum

Earnings Beats

Lower Quality

Lower Growth

Revenues Miss

Average Quality

Strong Momentum

Revenues Beats

2. Ferrovial's Q3 2025 Earnings: A Strong Performance

Segment Performance

Outlook and Valuation

Key Highlights and Future Plans

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.48%)

6. Segments

Construction

Expected Growth: 4.5%

Toll Roads

Expected Growth: 3.8%

Other

Expected Growth: 2.9%

Unallocated Adjustments

Expected Growth: 0.0%

Energy

Expected Growth: 6.2%

Airports

Expected Growth: 5.5%

7. Detailed Products

Airport Services

Highways and Motorways

Urban Services

Water Management

Rail and Metro

8. Ferrovial, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Ferrovial, S.A. passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

56.46$

Current Price

56.46$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA