[Executive Summary & Key Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Key%20Highlights) Granite reported strong financial results for Q2 and H1 2025, achieving record Committed and Awarded Projects and updating its full-year guidance to reflect strategic acquisitions [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%202025%20Highlights) Granite reported strong second quarter 2025 results with significant increases in net income and adjusted diluted EPS, achieving record CAP and updating guidance after strategic acquisitions - 2025 guidance raised to reflect acquisitions of Warren Paving and Papich Construction businesses[8](index=8&type=chunk) - Record Committed and Awarded Projects ("CAP") increased sequentially by **$324 million** to **$6.1 billion**[8](index=8&type=chunk) Second Quarter 2025 Key Financial Highlights | Metric | Q2 2025 | Q2 2024 | YoY Change | Source Chunk | | :-------------------------------- | :------ | :------ | :--------- | :----------- | | Net income attributable to Granite | $72M | $37M | +94.6% | 3 | | Diluted EPS | $1.42 | $0.76 | +86.8% | 3, 8 | | Adjusted net income attributable to Granite | $86M | $77M | +11.7% | 3 | | Adjusted diluted EPS | $1.93 | $1.73 | +11.6% | 3, 8 | | Revenue | $1.13B | $1.08B | +4% | 8, 9 | | Gross profit | $199M | $165M | +20.6% | 9 | | Adjusted EBITDA | $152M | $130M | +16.9% | 9 | [Six Months Ended June 30, 2025 Highlights](index=1&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Highlights) For the first six months of 2025, Granite demonstrated significant financial improvement, with net income attributable to Granite increasing substantially compared to the prior year, alongside healthy revenue, gross profit, and adjusted EBITDA growth Six Months Ended June 30, 2025 Key Financial Highlights | Metric | H1 2025 | H1 2024 | YoY Change | Source Chunk | | :-------------------------------- | :------ | :------ | :--------- | :----------- | | Net income attributable to Granite | $38M | $6M | +533.3% | 5 | | Diluted EPS | $0.84 | $0.13 | +546.2% | 5 | | Adjusted net income attributable to Granite | $87M | $68M | +27.9% | 5 | | Adjusted diluted EPS | $1.94 | $1.52 | +27.6% | 5 | | Revenue | $1.83B | $1.75B | +4.6% | 10 | | Gross profit | $283M | $219M | +29.2% | 10 | | Adjusted EBITDA | $180M | $144M | +25.0% | 10 | | Year-to-date operating cash flow | $5M | N/A | N/A | 10 | - Year-to-date operating cash flow of **$5 million**, positioned to achieve target of **9% operating cash flow as a percent of revenue** for the year[10](index=10&type=chunk) [Consolidated Financial Performance](index=2&type=section&id=Consolidated%20Financial%20Performance) Granite's consolidated financial performance for both Q2 and H1 2025 showed robust year-over-year growth in revenue, gross profit, and net income [Second Quarter 2025 Consolidated Results](index=1&type=section&id=Second%20Quarter%202025%20Consolidated%20Results) Granite's consolidated financial performance for the second quarter of 2025 showed robust growth across key metrics, with revenue increasing 4% year-over-year and gross profit seeing a significant increase, despite rising SG&A expenses Consolidated Statements of Operations (Three Months Ended June 30, in thousands) | Metric | 2025 | 2024 | YoY Change | Source Chunk | | :--------------------------------------- | :------------------ | :------------------ | :--------- | :----------- | | Revenue | $1,125,964 | $1,082,486 | +4.0% | 27 | | Cost of revenue | $926,865 | $917,775 | +1.0% | 27 | | Gross profit | $199,099 | $164,711 | +20.9% | 27 | | Selling, general and administrative expenses | $85,887 | $70,052 | +22.6% | 27 | | Operating income | $103,565 | $85,821 | +20.7% | 27 | | Income before income taxes | $107,559 | $59,550 | +80.6% | 27 | | Net income attributable to Granite | $71,700 | $36,895 | +94.3% | 27 | | Diluted EPS | $1.42 | $0.76 | +86.8% | 27 | - SG&A expenses increased **$16 million** to **$86 million** (**7.6% of revenue**) from **$70 million** (**6.5% of revenue**) in the prior year, primarily due to additional salaries, related expenses, and a greater percentage of annual incentive compensation[9](index=9&type=chunk) [Six Months Ended June 30, 2025 Consolidated Results](index=1&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Consolidated%20Results) For the first half of 2025, Granite's consolidated results demonstrated strong growth, with revenue increasing by $71 million and gross profit by $64 million year-over-year, leading to a more than doubled operating income and substantial net income growth Consolidated Statements of Operations (Six Months Ended June 30, in thousands) | Metric | 2025 | 2024 | YoY Change | Source Chunk | | :--------------------------------------- | :------------------ | :------------------ | :--------- | :----------- | | Revenue | $1,825,511 | $1,754,761 | +4.0% | 27 | | Cost of revenue | $1,542,563 | $1,535,765 | +0.4% | 27 | | Gross profit | $282,948 | $218,996 | +29.2% | 27 | | Selling, general and administrative expenses | $201,798 | $158,045 | +27.7% | 27 | | Operating income | $63,814 | $42,521 | +50.1% | 27 | | Income before income taxes | $67,476 | $20,582 | +227.8% | 27 | | Net income attributable to Granite | $38,044 | $5,912 | +543.5% | 27 | | Diluted EPS | $0.84 | $0.13 | +546.2% | 27 | - SG&A expenses increased **$44 million** to **$202 million** (**11.1% of revenue**) from **$158 million** (**9.0% of revenue**) in the prior year, primarily due to additional stock-based compensation, salaries, and a greater percentage of annual incentive compensation[10](index=10&type=chunk) [Segment Performance Review](index=2&type=section&id=Segment%20Performance%20Review) Granite's Construction and Materials segments both demonstrated strong year-over-year growth in revenue and gross profit, driven by acquisitions, improved execution, and higher volumes [Construction Segment Performance](index=2&type=section&id=Construction%20Segment%20Performance) The Construction segment experienced year-over-year revenue growth, primarily driven by the newly acquired Dickerson & Bowen business, with increased gross profit due to improved project execution and favorable claim settlements, and record CAP indicating strong future organic growth potential - Revenue increased year-over-year, primarily driven by the newly acquired Dickerson & Bowen business. Legacy business revenue was consistent and is expected to accelerate in the second half of the year[13](index=13&type=chunk) - Gross profit increased year-over-year due to improved project execution across a higher quality project portfolio and favorable claim settlements[13](index=13&type=chunk) - CAP increased **$324 million** sequentially to **$6.1 billion** and **$488 million** year-over-year, with a robust bidding pipeline in both public and private markets[14](index=14&type=chunk) Construction Segment Financials (Three & Six Months Ended June 30, in thousands) | Metric | Q2 2025 | Q2 2024 | Q2 YoY Change | H1 2025 | H1 2024 | H1 YoY Change | Source Chunk | | :------- | :--------------------- | :--------------------- | :------------ | :--------------------- | :--------------------- | :------------ | :----------- | | Revenue | $937,426 | $917,954 | +2.1% | $1,552,044 | $1,513,167 | +2.6% | 11 | | Gross profit | $153,666 | $135,372 | +13.5% | $239,104 | $192,200 | +24.4% | 11 | | Gross profit as a percent of revenue | 16.4% | 14.7% | +1.7 pp | 15.4% | 12.7% | +2.7 pp | 11 | [Materials Segment Performance](index=2&type=section&id=Materials%20Segment%20Performance) The Materials segment demonstrated strong year-over-year improvements in revenue, gross profit, and cash gross profit for both the second quarter and the first six months of 2025, primarily driven by higher aggregates and asphalt volumes and increased aggregate sales prices - Revenue, gross profit, and cash gross profit improved year-over-year primarily driven by higher aggregates and asphalt volumes and higher aggregate sales prices[16](index=16&type=chunk) Materials Segment Financials (Three & Six Months Ended June 30, in thousands) | Metric | Q2 2025 | Q2 2024 | Q2 YoY Change | H1 2025 | H1 2024 | H1 YoY Change | Source Chunk | | :-------------------------------- | :--------------------- | :--------------------- | :------------ | :--------------------- | :--------------------- | :------------ | :----------- | | Revenue | $188,538 | $164,532 | +14.6% | $273,467 | $241,594 | +13.2% | 15 | | Gross profit | $45,433 | $29,339 | +54.9% | $43,844 | $26,796 | +63.6% | 15 | | Gross profit as a percent of revenue | 24.1% | 17.8% | +6.3 pp | 16.0% | 11.1% | +4.9 pp | 15 | | Cash gross profit | $59,001 | $39,300 | +50.1% | $69,478 | $46,516 | +49.4% | 15 | | Cash gross profit as a % of revenue | 31.3% | 23.9% | +7.4 pp | 25.4% | 19.3% | +6.1 pp | 15 | [Materials Product Line Performance (Three Months Ended June 30, 2025)](index=12&type=section&id=Materials%20Product%20Line%20Performance%20%28Three%20Months%20Ended%20June%2030%2C%202025%29) In Q2 2025, the Materials segment's Aggregate product line saw increased sales tons and average selling price, contributing to higher gross profit and cash gross profit, while the Asphalt product line also experienced growth in sales tons, leading to improved gross profit and cash gross profit Materials Product Line Performance (Q2 2025 vs. Q2 2024, in thousands) | Metric | Aggregate Q2 2025 | Aggregate Q2 2024 | Asphalt Q2 2025 | Asphalt Q2 2024 | Source Chunk | | :-------------------------- | :------------------ | :------------------ | :---------------- | :---------------- | :----------- | | External revenue | $59,643 | $54,347 | $128,625 | $109,372 | 41 | | Sales tons | 6,299 | 5,658 | 2,329 | 2,163 | 41 | | Average selling price per ton | $16.76 | $16.36 | $79.85 | $79.49 | 41 | | Gross profit | $24,869 | $23,014 | $29,770 | $26,593 | 41 | | Gross profit as a % of revenue | 23.6% | 24.9% | 16.0% | 15.5% | 41 | | Cash gross profit | $34,299 | $29,574 | $33,830 | $29,270 | 41 | | Cash gross profit as a % of revenue | 32.5% | 31.9% | 18.2% | 17.0% | 41 | [Materials Product Line Performance (Six Months Ended June 30, 2025)](index=13&type=section&id=Materials%20Product%20Line%20Performance%20%28Six%20Months%20Ended%20June%2030%2C%202025%29) For the first six months of 2025, both Aggregate and Asphalt product lines within the Materials segment showed increased external revenue, sales tons, and improved gross and cash gross profits compared to the prior year, contributing to the segment's overall strong performance Materials Product Line Performance (H1 2025 vs. H1 2024, in thousands) | Metric | Aggregate H1 2025 | Aggregate H1 2024 | Asphalt H1 2025 | Asphalt H1 2024 | Source Chunk | | :-------------------------- | :------------------ | :------------------ | :---------------- | :---------------- | :----------- | | External revenue | $100,045 | $90,436 | $173,063 | $150,185 | 43 | | Sales tons | 10,067 | 8,886 | 3,062 | 2,712 | 43 | | Average selling price per ton | $16.34 | $15.86 | $80.81 | $80.88 | 43 | | Gross profit | $28,609 | $20,904 | $26,966 | $22,014 | 43 | | Gross profit as a % of revenue | 17.4% | 14.8% | 10.9% | 10.0% | 43 | | Cash gross profit | $46,359 | $34,585 | $34,696 | $27,903 | 43 | | Cash gross profit as a % of revenue | 28.2% | 24.5% | 14.0% | 12.7% | 43 | [Outlook and Strategic Initiatives](index=3&type=section&id=Outlook%20and%20Strategic%20Initiatives) Granite updated its 2025 fiscal year guidance to reflect recent strategic acquisitions, which are expected to enhance adjusted EBITDA margin and cash flows [2025 Fiscal Year Guidance Update](index=3&type=section&id=2025%20Fiscal%20Year%20Guidance%20Update) Granite has updated its 2025 fiscal year guidance to incorporate the impact of recent acquisitions, projecting increased revenue and an improved adjusted EBITDA margin, while SG&A expenses and the effective tax rate remain consistent with previous estimates Updated 2025 Fiscal Year Guidance | Metric | Guidance Range | Notes | Source Chunk | | :-------------------------- | :------------- | :------ | :----------- | | Revenue | $4.35B - $4.55B | Includes ~$150M from new acquisitions | 21 | | Adjusted EBITDA margin | 11.25% - 12.25% | Increased | 21 | | SG&A expense | ~9.0% of revenue | Unchanged, includes ~$40M stock-based compensation | 21 | | Effective tax rate for adjusted net income | Mid-20s | Unchanged | 21 | | Capital expenditures | $140M - $160M | Unchanged | 21 | [Strategic Acquisitions and Capital Allocation](index=1&type=section&id=Strategic%20Acquisitions%20and%20Capital%20Allocation) Granite's recent acquisitions of Warren Paving and Papich Construction are aligned with its capital allocation strategy to invest in high-quality businesses that strengthen and expand home markets, expected to be immediately accretive to adjusted EBITDA margin and cash flows, with the company well-positioned for future M&A opportunities - Two acquisitions announced: one in the Southeast providing significant aggregate supply on the Mississippi River, and another in California strengthening business with additional aggregates and a leading civil construction business[4](index=4&type=chunk) - Acquisitions are in alignment with capital allocation strategy to invest in high-quality businesses that strengthen and expand home markets and are immediately accretive to **adjusted EBITDA margin** and **cash flows**[18](index=18&type=chunk) - Pro-forma leverage is well within target, and an expanded credit facility positions the company to act on future M&A opportunities[18](index=18&type=chunk) [Corporate Information](index=3&type=section&id=Corporate%20Information) This section provides an overview of Granite's identity, details regarding its Q2 2025 conference call, and important disclaimers about forward-looking statements [About Granite](index=3&type=section&id=About%20Granite) Granite Construction Incorporated, established in 1922, is a leading diversified vertically-integrated civil contractor and construction materials producer in the United States, guided by its Code of Conduct and Core Values emphasizing safety, quality, and sustainability - Granite is America's Infrastructure Company™, one of the largest diversified vertically-integrated civil contractors and construction materials producers in the United States[20](index=20&type=chunk) - The company's Code of Conduct and strong Core Values guide its operations, upholding high ethical standards and leadership in safety, quality, and sustainability[20](index=20&type=chunk) [Conference Call Details](index=3&type=section&id=Conference%20Call%20Details) Granite hosted a conference call on August 7, 2025, to discuss its second quarter 2025 results, with investors able to access a live audio webcast or dial-in, and replays available for a limited period - Conference call held on **August 7, 2025**, at **8:00 a.m. Pacific Time/11:00 a.m. Eastern Time** to discuss Q2 2025 results[19](index=19&type=chunk) - Live audio webcast available on the Investor Relations website (https://investor.graniteconstruction.com) and via dial-in[19](index=19&type=chunk) - An archive of the webcast and a replay were available after the live call through **August 14, 2025**[19](index=19&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section serves as a cautionary statement regarding forward-looking statements within the news release, highlighting that such statements are based on management's current beliefs and estimates, involve inherent risks and uncertainties, and may not be realized, advising readers not to place undue reliance on them - Statements not based on historical facts, including future events, performance, growth, and **2025 fiscal year guidance**, constitute forward-looking statements[22](index=22&type=chunk) - These statements are based on management's current beliefs, assumptions, and estimates, which may not be realized due to numerous risks and uncertainties beyond the company's control[22](index=22&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, and the company undertakes no obligation to revise or update them, except as required by law[23](index=23&type=chunk) [Condensed Consolidated Financial Statements](index=5&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents Granite's condensed consolidated balance sheets, statements of operations, and cash flows, highlighting key financial positions and performance for the periods presented [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The condensed consolidated balance sheets show Granite's financial position as of June 30, 2025, compared to December 31, 2024, with total assets increasing slightly due to higher receivables and long-term marketable securities, while cash and cash equivalents decreased and total liabilities rose Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | Change | | :-------------------------------- | :------------ | :---------------- | :----- | | **ASSETS** | | | | | Cash and cash equivalents | $322,017 | $578,330 | -$256,313 | | Total current assets | $1,691,615 | $1,716,663 | -$25,048 | | Total assets | $3,105,991 | $3,025,655 | +$80,336 | | **LIABILITIES AND EQUITY** | | | | | Total current liabilities | $1,076,151 | $1,031,959 | +$44,192 | | Total liabilities and equity | $3,105,991 | $3,025,655 | +$80,336 | | Total Granite Construction Incorporated shareholders' equity | $1,062,748 | $1,015,226 | +$47,522 | | Total equity | $1,114,355 | $1,079,363 | +$34,992 | - Receivables, net increased from **$511,742 thousand** at December 31, 2024, to **$704,988 thousand** at June 30, 2025[25](index=25&type=chunk) - Long-term marketable securities increased from **$0** at December 31, 2024, to **$98,069 thousand** at June 30, 2025[25](index=25&type=chunk) [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The condensed consolidated statements of operations highlight significant year-over-year improvements for both the three and six months ended June 30, 2025, with increased revenue and gross profit leading to substantial growth in operating income and net income attributable to Granite, despite higher SG&A expenses Condensed Consolidated Statements of Operations (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | Source Chunk | | :--------------------------------------- | :------ | :------ | :------ | :------ | :----------- | | Revenue | $1,125,964 | $1,082,486 | $1,825,511 | $1,754,761 | 27 | | Gross profit | $199,099 | $164,711 | $282,948 | $218,996 | 27 | | Selling, general and administrative expenses | $85,887 | $70,052 | $201,798 | $158,045 | 27 | | Operating income | $103,565 | $85,821 | $63,814 | $42,521 | 27 | | Income before income taxes | $107,559 | $59,550 | $67,476 | $20,582 | 27 | | Net income | $80,345 | $38,857 | $52,018 | $9,415 | 27 | | Net income attributable to Granite | $71,700 | $36,895 | $38,044 | $5,912 | 27 | | Diluted EPS | $1.42 | $0.76 | $0.84 | $0.13 | 27 | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, Granite reported net cash provided by operating activities of $5.4 million, a decrease from the prior year, with significant net cash outflows from investing activities due to marketable securities and property purchases, and cash used in financing activities for debt repayments and distributions Condensed Consolidated Statements of Cash Flows (Six Months Ended June 30, in thousands) | Activity | 2025 | 2024 | Change | | :-------------------------------- | :----- | :----- | :----- | | Net cash provided by operating activities | $5,438 | $22,084 | -$16,646 | | Net cash used in investing activities | $(207,255) | $(50,122) | -$157,133 | | Net cash used in financing activities | $(54,496) | $(22,879) | -$31,617 | | Net decrease in cash and cash equivalents | $(256,313) | $(50,917) | -$205,396 | | Cash and cash equivalents at end of period | $322,017 | $366,746 | -$44,729 | - Purchases of marketable securities amounted to **$172,578 thousand** in H1 2025, compared to none in H1 2024[29](index=29&type=chunk) - Stock-based compensation increased significantly from **$15,084 thousand** in H1 2024 to **$34,632 thousand** in H1 2025[29](index=29&type=chunk) [Non-GAAP Financial Measures and Reconciliations](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section defines Granite's non-GAAP financial measures and provides reconciliations to their most directly comparable GAAP measures, offering additional insights into operational performance [Non-GAAP Measures Description](index=9&type=section&id=Non-GAAP%20Measures%20Description) Granite provides several non-GAAP financial measures, including EBITDA, Adjusted EBITDA, Adjusted Net Income, and Materials segment cash gross profit, to offer additional insights into its operating performance, used by management and investors to facilitate comparisons and evaluate performance by excluding certain non-recurring or non-cash items, but not intended as substitutes for GAAP results - Non-GAAP measures like **EBITDA** and **EBITDA margin** are useful for evaluating operating performance and facilitating comparisons between companies with different capital structures and tax rates[30](index=30&type=chunk) - **Adjusted EBITDA** and **Adjusted EBITDA margin** exclude the impact of stock-based compensation, loss on debt extinguishment, and other costs (legal fees, reorganization, acquisition/integration expenses, impairment charges)[30](index=30&type=chunk) - Materials segment **cash gross profit** excludes depreciation, depletion, and amortization to better illustrate operational performance from segment assets[31](index=31&type=chunk) - Non-GAAP measures are provided in addition to, not as alternatives for, GAAP results and may not be comparable to similar measures used by other companies[32](index=32&type=chunk) [EBITDA and Adjusted EBITDA Reconciliation](index=10&type=section&id=EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) The reconciliation of GAAP net income to EBITDA and Adjusted EBITDA demonstrates the impact of non-operating and non-cash items on the company's profitability, with both EBITDA and Adjusted EBITDA showing significant year-over-year increases for the three and six months ended June 30, 2025, reflecting improved operational performance after adjustments EBITDA and Adjusted EBITDA (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | Source Chunk | | :-------------------------- | :------ | :------ | :------ | :------ | :----------- | | Net income attributable to Granite | $71,700 | $36,895 | $38,044 | $5,912 | 35 | | EBITDA | $136,758 | $89,628 | $123,187 | $79,773 | 35 | | EBITDA margin | 12.1% | 8.3% | 6.7% | 4.5% | 35 | | Adjusted EBITDA | $152,426 | $129,866 | $180,498 | $143,916 | 35 | | Adjusted EBITDA margin | 13.5% | 12.0% | 9.9% | 8.2% | 35 | - Adjustments for Adjusted EBITDA include other costs, net (**$13.3M** in Q2 2025), stock-based compensation (**$2.4M** in Q2 2025), and loss on debt extinguishment (none in Q2 2025, **$27.8M** in Q2 2024)[35](index=35&type=chunk) [Adjusted Net Income Reconciliation](index=11&type=section&id=Adjusted%20Net%20Income%20Reconciliation) The adjusted net income reconciliation provides a clearer view of Granite's underlying profitability by removing the impact of specific non-GAAP adjustments such as other costs, transaction costs, stock-based compensation, and loss on debt extinguishment, resulting in higher adjusted net income and adjusted diluted EPS compared to GAAP figures for both periods Adjusted Net Income Reconciliation (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | Source Chunk | | :--------------------------------------- | :------ | :------ | :------ | :------ | :----------- | | Income before income taxes | $107,559 | $59,550 | $67,476 | $20,582 | 38 | | Adjusted income before income taxes | $127,219 | $104,101 | $132,766 | $94,665 | 38 | | Net income attributable to Granite | $71,700 | $36,895 | $38,044 | $5,912 | 38 | | Adjusted net income attributable to Granite | $86,298 | $76,977 | $86,522 | $67,848 | 38 | | Diluted net income per share attributable to common shareholders | $1.42 | $0.76 | $0.84 | $0.13 | 38 | | Adjusted diluted earnings per share attributable to common shareholders | $1.93 | $1.73 | $1.94 | $1.52 | 38 | - Adjusting items include other costs, net, transaction costs, stock-based compensation, and loss on debt extinguishment, which are added back to GAAP income before income taxes[38](index=38&type=chunk) - The dilutive effect of convertible notes is removed for **adjusted diluted EPS** calculation to reflect the impact of capped call transactions[39](index=39&type=chunk)

Group 1 - Granite Construction operates in the construction industry, providing infrastructure solutions for both public and private clients [1] - The company has shown impressive performance and continues to attract attention in the market [1] Group 2 - Crude Value Insights focuses on the oil and natural gas sector, emphasizing cash flow and the potential for value and growth [1] - Subscribers benefit from a stock model account, detailed cash flow analyses of exploration and production firms, and live discussions about the sector [2]

Company Overview - Fluor (FLR) is a notable stock in the Construction sector, which consists of 88 individual stocks and currently holds a Zacks Sector Rank of 14 out of 16 groups [2] - Fluor has a Zacks Rank of 1 (Strong Buy), indicating a positive earnings outlook based on earnings estimates and revisions [3] Performance Analysis - The Zacks Consensus Estimate for Fluor's full-year earnings has increased by 0.4% over the past quarter, reflecting improved analyst sentiment [4] - Year-to-date, Fluor has returned approximately 4.2%, outperforming the average loss of 1.7% in the Construction sector [4] - In comparison, Granite Construction (GVA) has also returned 4.2% this year, with an 8.2% increase in the consensus EPS estimate over the past three months, and holds a Zacks Rank of 2 (Buy) [5] Industry Context - Fluor is part of the Engineering - R and D Services industry, which includes 17 companies and is currently ranked 74 in the Zacks Industry Rank, with an average gain of 8.5% this year, indicating that Fluor is slightly underperforming its industry [6] - Granite Construction belongs to the Building Products - Heavy Construction industry, which is ranked 3 and has seen an increase of 11.8% this year [7]

Core Insights - Tutor Perini Corporation (TPC) and Granite Construction Incorporated (GVA) are benefiting from a strong cycle of infrastructure investment, particularly in large-scale civil and transportation contracts [1][2] Company Overview - Both companies specialize in large-scale public infrastructure projects, including highways, bridges, and rail systems, often supported by state and federal funding [2] - Their operations align closely with national infrastructure initiatives, positioning them as key players in upcoming federally funded projects [2] Current Market Environment - Infrastructure spending remains robust, with public funding supporting long-term project pipelines, prompting both companies to focus on expanding backlog, winning contracts, and improving execution efficiency [3] - Strong demand is anticipated from both public and private markets, making operational scaling and project visibility central to their strategies [3] Tutor Perini Corporation (TPC) - TPC is leveraging the surge in infrastructure spending to enhance its backlog and diversify its exposure to large-scale projects across various sectors [5] - In Q1 2025, TPC secured approximately $2 billion in new awards, increasing its backlog to a record $19.4 billion, nearly doubling from the previous year [6] - The company raised its 2025 earnings guidance, indicating strong performance and a favorable project environment [7] - TPC's projected EPS for 2025 suggests a significant year-over-year increase of 155.9% [17] Granite Construction Incorporated (GVA) - GVA is experiencing momentum in both public and private markets, with a disciplined focus on core markets and risk-managed project selection [8] - In Q1 2025, GVA's Committed and Awarded Projects (CAP) reached a record $5.7 billion, reflecting a 7.5% sequential increase and a 3.6% year-over-year rise [9] - GVA expects to maintain its growth trajectory, with projected revenues of $4.2-$4.4 billion and adjusted EBITDA margins of 11-12% for 2025 [11] Stock Performance and Valuation - TPC's stock has surged 82.3% over the past three months, outperforming the industry average of 30.1%, while GVA shares have risen 21% [12] - TPC is trading at a premium compared to GVA based on the forward 12-month price-to-earnings (P/E) ratio [13] Final Assessment - Both companies are well-positioned to benefit from strong infrastructure spending and multi-year project pipelines [20] - TPC stands out with a record backlog, stronger earnings growth outlook, and rising momentum in civil and commercial markets [21] - GVA, while maintaining steady growth, is viewed as less compelling in the near term due to its more measured pace and valuation [22]

Group 1 - Dream Finders Homes Inc. (DFH) has outperformed the Construction sector with a year-to-date gain of approximately 5.4%, while the sector has returned an average of -2.1% [4] - DFH currently holds a Zacks Rank of 2 (Buy), indicating a positive earnings outlook and strong analyst sentiment, with the consensus estimate for full-year earnings moving 2.9% higher in the past quarter [3][4] - The company is part of the Building Products - Home Builders industry, which has seen an average loss of 12% this year, further highlighting DFH's relative strength [6] Group 2 - Granite Construction (GVA) is another stock in the Construction sector that has outperformed, with a year-to-date increase of 2.5% and a Zacks Rank of 2 (Buy) [5] - The Building Products - Heavy Construction industry, to which Granite Construction belongs, is currently ranked 3 and has gained 3.7% this year [6] - Investors are encouraged to monitor both Dream Finders Homes Inc. and Granite Construction for potential continued strong performance in the Construction sector [7]

Core Viewpoint - Granite Construction Incorporated (GVA) has demonstrated strong stock performance, rising 41.4% over the past year, significantly outperforming the Zacks Building Products - Heavy Construction industry's growth of 16.8% and the overall market's increase of 9.3% [1][2]. Group 1: Market Performance - GVA stock has outperformed competitors such as MasTec, Inc. (MTZ), EMCOR Group, Inc. (EME), and Dycom Industries, Inc. (DY), which saw gains of 38.2%, 17.7%, and 26.6% respectively over the same period [3]. - Technical indicators show GVA stock trading above both the 50 and 200-day simple moving averages, indicating a bullish trend and positive market sentiment [7]. Group 2: Growth Opportunities - The company anticipates strong opportunities in both public and private markets, securing high-quality projects that align with its growth and margin targets [2][10]. - GVA's Committed and Awarded Projects (CAP) reached $5.7 billion in Q1 2025, reflecting a 7.5% sequential growth and a 3.6% year-over-year increase, driven by increased public spending [13]. Group 3: Strategic Expansion - Granite is focused on enhancing its market presence through acquisitions and investments, having increased its reserves by 56% to 1.6 billion tons from 2022 to 2024 [14]. - The company aims to complete two to three targeted acquisitions in 2025, focusing on vertically integrated, materials-focused businesses [15]. Group 4: Earnings Estimates and Valuation - The Zacks Consensus Estimate for Granite's 2025 earnings has increased, indicating a growth of 23.2% from the previous year [17]. - GVA is currently trading at a discount compared to industry peers, making it an attractive option for investors despite its recent stock price increase [18][20].

Core Viewpoint - Granite Construction Incorporated (GVA) has secured a $26-million contract for upgrades at San Francisco International Airport, which will enhance taxiway safety and functionality [1][2][3]. Group 1: Contract Details - The project involves upgrades to Taxiway Z and a section of Taxiway S, funded by SFO and included in GVA's second-quarter Committed and Awarded Projects (CAP) [1][2]. - The work will improve key taxiways used for aircraft movement, supporting ongoing airport operations [2][3]. - GVA's responsibilities include reconstructing asphalt concrete pavement, upgrading airfield lighting to LED, improving signage, enhancing electrical duct banks, and updating pavement markings and drainage [4]. Group 2: Project Timeline and Resources - Construction is scheduled to start in August 2025 and finish by November 2025 [5]. - GVA's Santa Clara hot plant will supply 24,105 tons of hot mix asphalt for the project [5]. Group 3: CAP Portfolio and Growth - GVA is focusing on expanding its high-quality CAP portfolio, which totaled $5.7 billion as of Q1 2025, reflecting a 7.5% sequential growth from $5.3 billion at the end of 2024 [6][7]. - The growth in CAP is attributed to increased public spending trends, providing favorable bidding opportunities despite macroeconomic challenges [7]. Group 4: Stock Performance and Market Outlook - GVA's shares have gained 39.7% over the past year, outperforming the Zacks Building Products - Heavy Construction industry's growth of 16.5% [9]. - The company anticipates strong opportunities across public and private markets to foster growth, despite market uncertainties and inflation concerns [9].

Core Viewpoint - Growth stocks are appealing due to their potential for above-average financial growth, but identifying those that can fulfill their potential is challenging due to associated risks and volatility [1] Group 1: Company Overview - Granite Construction (GVA) is currently highlighted as a promising growth stock, supported by a favorable Growth Score and a top Zacks Rank [2] - The company has a historical EPS growth rate of 48.6%, with projected EPS growth of 23.2% this year, significantly surpassing the industry average of 13.3% [5] - Granite Construction's year-over-year cash flow growth stands at 47.2%, well above the industry average of 13.4% [6] Group 2: Financial Metrics - The annualized cash flow growth rate for Granite Construction over the past 3-5 years is 29.1%, compared to the industry average of 8% [7] - The Zacks Consensus Estimate for the current year's earnings has increased by 8.2% over the past month, indicating a positive trend in earnings estimate revisions [8] Group 3: Investment Positioning - Granite Construction has achieved a Zacks Rank of 2 (Buy) and a Growth Score of A, positioning it favorably for potential outperformance in the growth stock category [10]

Group 1: Contract Announcement - Granite Construction Incorporated (GVA) has been awarded a $54 million CMGC contract by the Alaska Department of Transportation and Public Facilities for the first phase of a construction project [1] - Following the announcement, GVA's stock increased by 0.3% in after-hours trading [1] Group 2: Project Details - The first phase involves realigning the Parks Highway from milepost 319 to 322, which includes 2.5 million cubic yards of onsite earthwork, 25,000 tons of asphalt paving, and full traffic diversion [2] - The project will utilize GVA's equipment fleet, including a portable crusher and hot plant [2] - Construction is set to begin on May 1, 2025, and is expected to be completed by September 2027 [3] Group 3: Growth Strategy - Granite is focusing on expanding a high-quality CAP portfolio, driven by a favorable public funding environment and a resilient private market [4] - The company aims to pursue best-value projects to leverage established relationships and minimize risk [4] Group 4: Financial Performance - As of Q1 2025, Granite's CAP totaled $5.7 billion, reflecting a 7.5% sequential growth from $5.3 billion at the end of 2024 and a 3.6% year-over-year growth from $5.5 billion [5] - The growth is attributed to increased public spending trends, providing favorable bidding opportunities despite macroeconomic challenges [5] - GVA's shares have increased by 39.8% over the past year, outperforming the Zacks Building Products - Heavy Construction industry's growth of 19.5% [6] Group 5: Market Outlook - The company anticipates strong opportunities in both public and private markets, which are expected to support growth despite market uncertainties and inflation concerns [8]

Industry Overview - The Zacks Building Products - Heavy Construction industry is experiencing strong growth driven by favorable long-term trends, despite facing near-term challenges such as high interest rates and labor market pressures [1][8] - The industry includes mechanical and electrical construction, industrial and energy infrastructure, and building service providers, focusing on heavy civil construction projects like highways, bridges, and ports [3] Growth Drivers - A robust federal infrastructure agenda is unlocking significant investments in transportation, broadband, and energy networks, leading to increased demand in high-growth sectors [2] - The data center market's expansion is creating new opportunities for heavy construction companies, as demand for large-scale infrastructure solutions rises [5] - The ramp-up of 5G projects is benefiting industry players, with increased demand for wireline and wireless networks [6] Company Performance - EMCOR Group Inc. is benefiting from surging demand in data centers and healthcare, with a backlog of $11.8 billion reflecting strong long-term demand [32] - MasTec, with a backlog of $15.88 billion, has seen a 23.7% year-over-year increase, driven by growth across all segments [29] - Granite Construction has a record-high CAP of $5.7 billion, supported by federal and state infrastructure funding [21] Market Outlook - The industry's Zacks Industry Rank is 10, placing it in the top 4% of over 250 Zacks industries, indicating solid near-term prospects [10][11] - Aggregate earnings estimates for the industry have increased from $5.61 to $5.76 per share for 2025, reflecting growing analyst confidence [12] Recent Performance - The Zacks Building Products - Heavy Construction industry has outperformed the broader Zacks Construction sector and the S&P 500, gaining 12.3% over the past year compared to the sector's 7.9% decline [14] - The industry's current forward P/E ratio is 17.43, lower than the S&P 500's 20.43, suggesting potential value [17]