Company Overview - Construction Partners, Inc. is a vertically integrated civil infrastructure company operating in local markets throughout the Sunbelt, including Alabama, Florida, Georgia, North Carolina, Oklahoma, South Carolina, Tennessee, and Texas [2] - The company specializes in the construction, repair, and maintenance of surface infrastructure, primarily focusing on publicly funded projects such as local and state roadways, interstate highways, airport runways, and bridges [2] - In addition to public projects, the company also engages in private sector projects, including paving and sitework for office and industrial parks, shopping centers, local businesses, and residential developments [2] Upcoming Financial Results - The company will release its fiscal 2025 third quarter results on August 7, 2025, before the market opens [1] - A conference call to discuss the results is scheduled for 10:00 a.m. Eastern Time on the same date, accessible via phone or webcast [1] - Participants can access the conference call by dialing (412) 902-0003 or through the company's Investor Relations website [1]

Core Insights - Construction Partners, Inc. (ROAD) is trading at a premium with a forward 12-month P/E ratio of 40.7, significantly higher than the broader Construction sector (18.76) and the S&P 500 index (22.64) [2][4] - The company's vertically integrated business model and diverse product offerings are enhancing its prospects amid favorable public infrastructure spending [4][18] - ROAD stock has increased by 37.1% over the past three months, outperforming both the industry and notable competitors [5] Business Model and Growth Strategy - The vertically integrated model reduces supply-chain risks and supports an EBITDA margin of 15.2% [6] - The Lone Star acquisition has expanded ROAD's geographic reach and added 10 HMA plants, aiding in the execution of its ROAD-Map 2027 strategy [6][10] - The company aims for annual revenue growth of 15-20% and EBITDA margin expansion of 13-14% through its strategic business model [8] Financial Outlook - For fiscal 2025, ROAD expects revenues between $2.77 billion and $2.83 billion, indicating a year-over-year growth of 52.2-55.5% [12] - Adjusted EBITDA is forecasted to be between $410 million and $430 million, reflecting a year-over-year growth of 85.9-94.9% [12] - Earnings per share (EPS) estimates for fiscal 2025 and 2026 have increased to $2.17 and $2.73, representing growth of 63.2% and 25.7% respectively [13] Technical Indicators - ROAD stock is trading above both the 50-day and 200-day simple moving averages, indicating a bullish trend and positive market sentiment [15] Analyst Sentiment - Analysts show optimism towards ROAD, with 60% of recommendations classified as "Strong Buy" [19][22]

Industry Overview - The Zacks Building Products - Miscellaneous industry is experiencing growth due to increased government infrastructure spending, which is driving demand for construction-related products and services [1] - Key players in the industry, such as United Rentals, Inc., Masco Corporation, Construction Partners, Inc., Hillman Solutions Corp., and Quanex Building Products Corporation, are well-positioned to capitalize on these trends [1] Current Challenges - The industry faces near-term challenges from high mortgage rates, affordability concerns, and inflation-related cost pressures, including tariffs on raw materials like iron, steel, and copper [2] - Despite these challenges, proactive cost management and pricing strategies are helping to mitigate headwinds [2] Industry Description - The industry comprises manufacturers, designers, and distributors of home improvement and building products, including ceiling systems, doors, windows, flooring, and metal products [3] - Companies also provide solutions for rehabilitating aging infrastructure and rent equipment to a diverse customer base [3] Future Trends - Strong global trends in infrastructure modernization and energy transition are expected to benefit industry players [4] - Improving residential construction markets are anticipated to drive growth, with builders cautiously optimistic for 2025 due to a lack of existing inventory [4] Operational Strategies - Industry participants are implementing cost-saving initiatives, including business consolidation and supply chain improvements, to boost profitability [5] - Strategic investments in new products and acquisitions are being pursued to supplement organic growth [5] Tariff Impact - U.S. tariff policies are increasing costs and disrupting supply chains, leading to heightened inflation [6] - Overall construction input prices were reported to be 1.1% higher in June compared to the previous year [6] Market Performance - The Zacks Building Products - Miscellaneous industry has underperformed the S&P 500 Composite and the broader Zacks Construction sector over the past year, losing 8.4% [12] - The industry is currently trading at a forward P/E ratio of 16.7X, lower than the S&P 500's 22.61X and the sector's 18.76X [15] Company Highlights - **Construction Partners**: Positioned for strong growth with a record project backlog of $2.84 billion and significant revenue growth from acquisitions [20][21] - **Quanex**: Benefiting from the acquisition of Tyman, contributing to a 67.3% year-over-year increase in consolidated sales [24][25] - **United Rentals**: Growth driven by strong demand in infrastructure projects and a stable customer sentiment, with a reaffirmed full-year guidance [27][28][29] - **Masco**: Facing a potential $400 million tariff headwind but expects to offset 50%-65% through pricing and cost reduction efforts [31][32] - **Hillman**: Aiming to reduce reliance on Chinese suppliers and maintain sales growth despite macroeconomic challenges [35][36]

Core Viewpoint - Heidelberg Materials AG Unsponsored ADR (HDLMY) is currently viewed as a better value opportunity compared to Construction Partners (ROAD) based on various valuation metrics [1][7]. Valuation Metrics - HDLMY has a forward P/E ratio of 15.88, while ROAD has a significantly higher forward P/E of 48.55 [5]. - The PEG ratio for HDLMY is 1.23, which is comparable to ROAD's PEG ratio of 1.31, indicating that HDLMY may offer better value relative to its expected earnings growth [5]. - HDLMY's P/B ratio stands at 2.16, contrasting with ROAD's P/B ratio of 7.3, further supporting the notion that HDLMY is undervalued [6]. Earnings Outlook - Both HDLMY and ROAD hold a Zacks Rank of 2 (Buy), indicating a positive earnings outlook due to favorable analyst estimate revisions [3]. - Despite both companies having solid earnings prospects, HDLMY's valuation metrics suggest it is the superior value option at this time [7].

Core Viewpoint - The partnership between Spectrum and Nexar aims to enhance road intelligence through improved network connectivity, enabling faster data delivery and insights for vehicle safety and autonomy [1][2]. Group 1: Partnership Details - Spectrum provides Nexar access to its extensive managed wireless network, which includes over 17 million secure wireless access points, facilitating efficient data transfer [3]. - The collaboration is expected to scale Nexar's data delivery capabilities across the United States, transforming everyday vehicles into data-generating assets for various applications [2][5]. Group 2: Technological Advancements - Nexar's AI platform captures anonymized road insights that can be utilized by insurers, mobility platforms, and cities to enhance safety and operational efficiency [2]. - The partnership is positioned to support time-sensitive, high-volume data transfer, which is crucial for the development of autonomous vehicle technologies [3][4]. Group 3: Industry Impact - This collaboration reflects Spectrum's strategy to leverage its network through innovative partnerships, contributing to the evolution of connected mobility solutions [4]. - The partnership aligns with Nexar's ongoing expansion into commercial fleets and urban environments, promoting the use of data-rich vehicles for insurance, mapping, and autonomous vehicle development [5].

Core Insights - Kellanova's survey reveals that Cheez-It and Pringles are the top favorite snack brands for summer road trips among U.S. adults [1][2][3] - The survey indicates that snacking preferences vary significantly across different generations and regions [3][4][6] Generational Snacking Preferences - Gen Z prefers adventurous flavors like sour and spicy, often traveling with friends and valuing shareability [6] - Millennials gravitate towards tangy flavors, focusing on family-friendly snacks, with 40% of respondents noting their kids snack frequently during trips [6] - Gen X enjoys a variety of snacks, favoring sweet, salty, and chocolatey options, typically traveling with a buddy [6] - Boomers also prefer salty, sweet, and chocolatey snacks, often traveling solo or with a partner, and are more likely to purchase snacks during stops [6] Regional Snacking Habits - The South tends to stock up on salty, sweet, and chocolatey snacks during their journeys [6] - Northeasterners are more inclined to choose creamy-flavored snacks compared to Midwesterners, with one-third of Midwesterners ranking cheesy snacks in their top three [6] - Residents of the Mountain West and Pacific Coast are less likely to plan snacks, preferring whatever is available, but still favor salty, sweet, and chocolatey flavors [6] Company Overview - Kellanova is a leader in global snacking, with a diverse portfolio of brands including Pringles, Cheez-It, and Pop-Tarts, and reported net sales of $13 billion in 2023 [7]

Core Viewpoint - Construction Partners (ROAD) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are closely correlated with stock price movements [4][6]. - Rising earnings estimates for Construction Partners suggest an improvement in the company's underlying business, likely leading to an increase in stock price [5][10]. Recent Performance and Projections - For the fiscal year ending September 2025, Construction Partners is expected to earn $2.17 per share, unchanged from the previous year, but the Zacks Consensus Estimate has increased by 10.8% over the past three months [8]. Zacks Rating System Overview - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% receiving a "Strong Buy" or "Buy" rating, indicating superior earnings estimate revisions [9][10]. - The Zacks Rank 2 upgrade places Construction Partners in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Group 1: Momentum Investing Overview - Momentum investing involves following a stock's recent trend, with the aim of buying high and selling higher, capitalizing on established price movements [1] - The Zacks Momentum Style Score helps define momentum characteristics, with Construction Partners (ROAD) currently holding a Momentum Style Score of B [2][3] Group 2: Performance Metrics of Construction Partners - Construction Partners has a Zacks Rank of 2 (Buy), indicating strong potential for outperformance [3] - Over the past week, ROAD shares increased by 2.1%, while the Zacks Building Products - Miscellaneous industry rose by only 0.06% [5] - In the last quarter, ROAD shares surged by 49.11%, and over the past year, they have risen by 84.36%, significantly outperforming the S&P 500's gains of 3.59% and 14.21% respectively [6] Group 3: Trading Volume and Earnings Outlook - ROAD's average 20-day trading volume is 501,201 shares, which is a bullish indicator when combined with rising stock prices [7] - In the past two months, three earnings estimates for ROAD have increased, raising the consensus estimate from $1.96 to $2.14 [9] - For the next fiscal year, two estimates have moved upwards, while one has been revised downwards [9] Group 4: Conclusion - Given the positive performance metrics and earnings outlook, Construction Partners is positioned as a 2 (Buy) stock with a Momentum Score of B, making it a strong candidate for near-term investment [11]

Core Viewpoint - Construction Partners, Inc. (ROAD) has experienced a significant share price increase of 52.3% over the past three months, outperforming its industry, sector, and the S&P 500 index [1][2]. Group 1: Business Model and Growth Prospects - The company's vertically integrated business model provides a competitive advantage, optimizing the supply chain and enhancing profitability while reducing volatility risks [4][20]. - ROAD aims for annual revenue growth of 15-20% and EBITDA margin expansion of 13-14% as part of its ROAD-Map 2027 goals [5]. - The company has diversified its offerings, allowing for both organic growth through service expansion and inorganic growth via acquisitions, enhancing its market reach [6][20]. Group 2: Recent Developments and Financial Outlook - The Lone Star Acquisition, completed on November 1, 2024, has expanded ROAD's geographic footprint and contributed positively to its business [7][9]. - For fiscal 2025, ROAD expects revenues between $2.77 billion and $2.83 billion, reflecting a year-over-year growth of 52.2-55.5% [10]. - Adjusted EBITDA is forecasted to be between $410 million and $430 million, indicating a year-over-year growth of 85.9% to 94.9% [10]. Group 3: Earnings Estimates and Market Sentiment - Earnings estimates for fiscal 2025 and 2026 have increased by 10.3% and 1.5%, respectively, reflecting strong growth expectations of 60.9% and 26.5% year-over-year [11][12]. - Technical indicators show that ROAD stock is trading above both the 50-day and 200-day simple moving averages, indicating a bullish trend and positive market sentiment [13][20]. Group 4: Valuation and Investment Considerations - ROAD is currently trading at a premium compared to its industry peers based on a forward 12-month price-to-earnings (P/E) ratio, suggesting strong market potential despite challenges in determining a suitable entry point for investors [17][19]. - The favorable fundamentals and technical trends support the view that ROAD is a solid investment choice in the current market environment [21].

Core Insights - Construction Partners (ROAD) is experiencing solid improvement in earnings estimates, which may lead to continued short-term price momentum [1][2] - The rising trend in estimate revisions reflects growing analyst optimism regarding the company's earnings prospects, which is expected to positively impact its stock price [2][3] Current-Quarter Estimate Revisions - The company is projected to earn $0.93 per share for the current quarter, indicating a year-over-year increase of +57.63% [6] - Over the past 30 days, one estimate has been revised upward with no negative revisions, resulting in a 7.75% increase in the Zacks Consensus Estimate [6] Current-Year Estimate Revisions - For the full year, Construction Partners is expected to earn $2.14 per share, representing a +60.9% change from the previous year [7] - The consensus estimate has increased by 10.29% due to three upward revisions and no negative revisions in the past month [7][8] Zacks Rank and Performance - The favorable estimate revisions have led to a Zacks Rank 2 (Buy) for Construction Partners, indicating strong potential for outperformance [9] - Stocks with Zacks Rank 1 (Strong Buy) and 2 (Buy) have historically outperformed the S&P 500 [9] Recent Stock Performance - Construction Partners shares have increased by 18.8% over the past four weeks, suggesting investor confidence in its earnings growth prospects [10]