Have you been paying attention to shares of Construction Partners (ROAD) ? Shares have been on the move with the stock up 29% over the past month. The stock hit a new 52-week high of $103.24 in the previous session. Construction Partners has gained 133.5% since the start of the year compared to the 29.5% move for the Zacks Construction sector and the 28.2% return for the Zacks Building Products - Miscellaneous industry.What's Driving the Outperformance?The stock has a great record of positive earnings surpr ...

Investors seek growth stocks to capitalize on above-average growth in financials that help these securities grab the market's attention and produce exceptional returns. But finding a growth stock that can live up to its true potential can be a tough task.In addition to volatility, these stocks carry above-average risk by their very nature. Also, one could end up losing from a stock whose growth story is actually over or nearing its end.However, the task of finding cutting-edge growth stocks is made easy wit ...

Financial Data and Key Metrics Changes - The company reported a revenue growth of 17% for fiscal year 2024, reaching $1.82 billion, with net income increasing by 41% to $68.9 million [7][25][26] - Adjusted EBITDA grew by 28% to $220.6 million, with an EBITDA margin of 12.1%, up from 11% in the previous year [7][26][27] - Cash flow from operations was $209 million, compared to $157 million in fiscal 2023 [9][31] Business Line Data and Key Metrics Changes - The revenue mix for the year included 7% organic growth and 10% from recent acquisitions [25] - Gross profit increased by approximately 32% to $258.3 million, with a gross profit margin of 14.2%, up from 12.6% [25][26] Market Data and Key Metrics Changes - The company reported a record project backlog of $1.96 billion, marking 16 consecutive quarters of backlog growth [17][27] - The demand environment remains robust in both commercial and public markets, with ongoing infrastructure funding from the IIJA [17][18][22] Company Strategy and Development Direction - The company aims to continue strategic acquisitions to expand market share and enhance operational excellence, with a focus on organic growth following acquisitions [15][23] - The acquisition of Lone Star Paving is expected to accelerate progress toward the company's roadmap 2027 goals by two years, with a focus on margin expansion [11][14][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing demand for infrastructure projects, particularly in Texas, which benefits from significant federal and state funding [19][21][49] - The company anticipates continued growth in fiscal 2025, with revenue guidance between $2.48 billion and $2.58 billion, and net income guidance between $97 million and $113 million [32][33] Other Important Information - The company completed eight acquisitions in fiscal 2024, expanding its geographic footprint and market share [9] - The company has an interest-rate swap agreement that fixes SOFR at 1.85%, resulting in a 3.1% interest rate on $300 million of term debt [30] Q&A Session Summary Question: Can you bridge the gap of how much of the margin progression is from Lone Star versus organic growth? - Management indicated that even without Lone Star, the company expected to achieve 50 to 60 basis points of margin expansion due to backlog and operational improvements [37][38] Question: Any thoughts on the perspective of TxDOT and visibility for revenues and top line growth? - Management highlighted that Texas receives a significant portion of federal funding and has created supplemental programs to enhance infrastructure spending, which will benefit growth opportunities [49][54] Question: Can you provide any EBITDA parameters for Q1? - Management noted that the guidance would reflect 11 months of EBITDA from Lone Star, with a typical seasonal distribution of 30% in the first half and 70% in the second half of the year [62] Question: Thoughts on cash from operations in '25 and proceeds from asset sales? - Management expects to convert EBITDA to cash flow from operations in the 85% to 90% range for 2025, with asset sales trending down due to improved supply chain conditions [65][66] Question: How much of the backlog is from Lone Star? - Management clarified that the reported backlog of $1.96 billion does not include Lone Star, as they joined on November 1, and their backlog will be included in the next quarter [73]

Group 1: Company Overview - Construction Partners, Inc. (ROAD) shares increased by 13.4% to close at $84.70, driven by higher trading volume compared to typical sessions [1] - The company announced the acquisition of Asphalt Inc., LLC, which is expected to generate $530 million in revenues and $120 million in Adjusted EBITDA for fiscal 2025 [1] - Preliminary results for fiscal 2024 were announced alongside guidance for fiscal 2025 [1] Group 2: Earnings Expectations - Construction Partners is projected to report quarterly earnings of $0.67 per share, reflecting a year-over-year increase of 13.6% [2] - Expected revenues for the upcoming quarter are $559.7 million, representing a 17.8% increase from the same quarter last year [2] - The consensus EPS estimate for the quarter has remained unchanged over the last 30 days, indicating stability in earnings expectations [2] Group 3: Industry Context - Construction Partners operates within the Zacks Building Products - Miscellaneous industry, where Advanced Drainage Systems (WMS) is another player, having closed 1.7% lower at $154.68 [2] - Advanced Drainage's consensus EPS estimate is $1.93, showing a year-over-year change of 12.9% [3] - Advanced Drainage currently holds a Zacks Rank of 4 (Sell), contrasting with Construction Partners' Zacks Rank of 3 (Hold) [2][3]

Construction Partners, Inc. (ROAD) or CPI, entered into a definitive agreement to acquire Asphalt Inc., LLC, doing business as Lone Star Paving. Based in Austin, TX, Lone Star focuses on asphalt manufacturing and paving. The company operates in high-growth markets with 10 hot-mix asphalt plants, four aggregate facilities and one liquid asphalt terminal across central Texas.This acquisition is expected to enhance Construction Partners' earnings and contribute $530 million in revenues and $120 million in Adju ...

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades. Even though momentum is a popular stock cha ...

Shares of Construction Partners (ROAD) have been strong performers lately, with the stock up 9.1% over the past month. The stock hit a new 52-week high of $67.21 in the previous session. Construction Partners has gained 54.4% since the start of the year compared to the 20.2% move for the Zacks Construction sector and the 16.5% return for the Zacks Building Products - Miscellaneous industry. What's Driving the Outperformance? The stock has a great record of positive earnings surprises, as it hasn't missed ou ...

Investors interested in Construction stocks should always be looking to find the best-performing companies in the group. Is Construction Partners (ROAD) one of those stocks right now? By taking a look at the stock's yearto-date performance in comparison to its Construction peers, we might be able to answer that question. Construction Partners is a member of the Construction sector. This group includes 91 individual stocks and currently holds a Zacks Sector Rank of #4. The Zacks Sector Rank considers 16 diff ...

Investors seek growth stocks to capitalize on above-average growth in financials that help these securities grab the market's attention and produce exceptional returns. But finding a growth stock that can live up to its true potential can be a tough task. By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss. However, it's pretty easy to find cutting-edge growth stocks with th ...

Investors might want to bet on Construction Partners (ROAD) , as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change. A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years. I ...