For your consideration: Bird Construction has soared like a tech stock lately, but it’s as old school as they get

Bird Construction Inc.
Mississauga
Revenue (2023) $2.8 billion
Profit (2023) $71.5 million
Three-year share price gain 108%
P/E ratio (trailing) 14.4
Bird BDT-T is the kind of company that can make seasoned value investors nervous. Its share price has more than doubled since last summer. But it’s no flash in the pan.
Founded in 1920 in Moose Jaw, Sask., Bird expanded first west, then east across Canada, and went public on the Winnipeg Stock Exchange in 1949. Richard Bird, grandson of founder Hubert J. Bird, a military engineer during the First World War, still sits on the board.
In recent decades, however, the big picture got muddier. Bird was an income trust from 2006 to 2011, paying out much of its earnings in distributions to investors. The company did a fair amount of work in Alberta’s oil sands, which were pounded by the 2015-16 petroleum downturn. Bird also participated in several public-private partnerships, which were hot vehicles for contractors in the early 2010s, but Bird transitioned away from using them in complex projects in 2019.
Then COVID-19 hit, just before Bird announced the acquisition of Calgary-based construction services company Stuart Olson Inc. for $96.5 million in July 2020. “We were all working remote,” says CEO Teri McKibbon, 60. He’s proud of that deal—it showed his company could “pivot and do something transformational.” Bird now operates coast to coast, with head offices in Mississauga and Calgary.
McKibbon’s long background in construction should also soothe investors. He’s been in the business since 1982, first with George Wimpey Canada, then 21 years with rival Aecon Group before he joined Bird in 2017, assuming the top job two years later.
With upheavals now in the rear-view mirror, investors can focus on Bird’s sound fundamentals and strong outlook . At any given time, the company has hundreds of projects on the go, and it finished 2023 with a record backlog (order book) of more than $3.4 billion.
Assignments are getting larger, too, but Bird isn’t flashy. It’s not a lead contractor on megaprojects such as Toronto’s Pearson Airport or Ontario’s highway 407. Among the recent initiatives McKibbon is proud of is work on the new LNG Canada and Woodfibre LNG export terminals in British Columbia; 50 schools across Western Canada; and the proposed east harbour transit hub in Toronto.
Bird has embarked on its second strategic plan under McKibbon, which will cover 2025 to 2027. He’s also pleased about the use of “collaborative contracting” in recent years, which more appropriately balances risk between contractors and their clients.
The stock market metrics are encouraging as well—hardly any debt on the balance sheet, and a still-modest price-to-earnings ratio despite the recent share-price surge. “It feels like we’ve got a long runway ahead of us for growth,” he says.
Risher, CEO of Lyft, is a key executive in a third great disruption of his career, after roles at Microsoft and Amazon in the 1990s and early 2000s. Uber and Lyft shares both sank after the ride-hailing companies went public in 2019. But Uber soared starting in 2022, while Lyft lagged. Even so, Risher is pumped about prospects for his company and the sector.
1. Risher, now 58, joined Lyft’s board in 2021. At Microsoft, he helped launch Windows 95, and he shifted to Amazon as senior VP U.S. retail in 1997. He then founded the kids’ charity Worldreader in 2009. But when Lyft searched for a new CEO in early 2023, co-founder Logan Green called and said, “David, I’ve got an offer I think you won’t refuse.”
2. Investors were euphoric about ride hailing in the early years. “But then COVID hit,” says Risher. In some ways, Uber got luckier than Lyft. It grew horizontally, founding Uber Eats and other spin-offs, and replicating its model overseas. “People really didn’t want to go out during COVID, but they did want to have food delivered to them,” he says.
3. Lyft has grown vertically, has stuck to North America, and focuses on drivers and customers. In part, that reflects Risher’s resumé—Bill Gates was very competitive, and Jeff Bezos was “all about customer obsession.” But Risher is also an idealist who wants people to get out of the house. “That’s really your life. You’re not just on your phone,” he says.
4. One huge debate: Are the drivers employees or independent contractors? Risher says they’re clearly contractors, and he drives himself once every six weeks or so. Most drivers are part time—about 20 hours a week. And he says many are “dual apping”—they look at Lyft, Uber and maybe a food delivery service. “They’re making all these choices,” he says.
5. Ride hailing may still be shiny and new, but for growth investors, it’s not rocket science. Uber now makes money, and Lyft should be profitable as it grows and exceeds fixed costs. They’re a duopoly in North America—Uber at about 70% market share and Lyft at 30%. “We’ll be cash-flow positive this year,” Risher says. And profitable? “Soon.”