April 26, 2018 11:00 am eastern

Stantec is up 4.6% this morning to $33.20 on news that it has put the construction company portion of its relatively recently acquired MWH division under strategic review (it wants to sell the division). This would be good in that it would get Stantec out of the construction business and back to being basically a 100% fee for services business. However, this decision may also be a hint that problems with the division that impacted earnings in Q4 have continued into Q1. Also we don’t know if Stantec will take a loss on the potential sale of the division.

I will likely maintain my position but this news could indicate continued volatility in Stantec’s share price. Hopefully strength in the rest of its business in Q1 will offset any problems in the construction division.