Key Takeaways:
AECOM (NYSE: ACM) shares fell 12% after law firm Kirby McInerney LLP announced an investigation into potential securities fraud, following the company's disclosure of a 98% drop in operating cash flow.
"The investigation concerns whether the Company and/or members of its senior management may have violated federal securities laws or engaged in other unlawful business practices," Kirby McInerney LLP said in a statement.
The infrastructure consulting firm reported operating cash flow of approximately $4 million for its second quarter of fiscal 2026, down 98% year-over-year, and a negative free cash flow of $27 million. Subsequently, the stock price declined by $9.55 per share, falling from $79.50 on May 11 to $69.95 on May 12. A quarterly report also revealed contract asset claims had swelled to $680 million, up from $400 million six months prior.
The investigation and sharp stock decline create significant uncertainty for investors. AECOM attributed the poor cash flow to delayed payments in the Middle East and protracted claim resolutions on two major projects from 2019 and 2020.
The decline marks the stock's lowest point since early 2025, putting pressure on management to restore investor confidence. Investors will be closely watching for the results of the law firm's investigation and any potential lawsuits that may follow.
This article is for informational purposes only and does not constitute investment advice.
