Construction Partners (ROAD) could be a solid choice for investors given its recent upgrade to a Zacks Rank #1 (Strong Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by t ...

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, the Zacks Growth Style Score (part of the Zacks Style Scores ...

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 ...