Bullish indicating open at $55-$60, IPO prices at $37
DOTHAN, Ala. - Construction Partners, Inc. (NASDAQ: ROAD), a civil infrastructure firm specializing in road construction and maintenance with a market capitalization of $4.9 billion, has expanded its operations in Tennessee with the acquisition of PRI of East Tennessee, Inc., a Knoxville-based asphalt manufacturing and construction business, and Pavement Restorations, Inc., a pavement preservation company located in Milan, Tennessee. According to InvestingPro data, the company has demonstrated robust growth with revenue increasing by 23% over the last twelve months.
Today, the company announced the integration of nearly 300 PRI employees into its existing workforce. The acquisition extends CPI’s reach across Tennessee, from Knoxville to the Memphis metropolitan area. The PRI leadership team will now include Jon Hargett as President and Greg Ailshie as Senior Vice President, both noted for their extensive industry experience in the region. InvestingPro analysis shows the company maintains a healthy financial position with a current ratio of 1.54, indicating strong ability to meet short-term obligations.
CPI’s President and CEO, Fred J. Smith III, expressed enthusiasm for the acquisition, highlighting Tennessee’s strong economic growth and favorable demographics as key drivers for the expansion. The state’s robust transportation funding program is also seen as a catalyst for organic and acquisitive growth opportunities within the infrastructure sector.
PRI’s expertise in pavement preservation and specialized services is expected to complement CPI’s existing operations. The company aims to leverage PRI’s capabilities to meet the growing demand for innovative solutions in maintaining and extending the life of pavements.
Construction Partners, Inc., operates throughout the Sunbelt, including Alabama, Florida, Georgia, North Carolina, Oklahoma, South Carolina, Tennessee, and Texas. The company’s primary focus is on publicly funded projects such as roadways, highways, airport runways, and bridges. CPI also undertakes private sector projects, including paving and sitework for various developments.
The press release also contained forward-looking statements regarding the expected benefits and outcomes of the acquisition. However, it noted that these statements are subject to risks and uncertainties that could cause actual results to differ materially.
This expansion is part of CPI’s strategy to strengthen its market position in the infrastructure industry, particularly in the pavement preservation niche. The information reported is based on a press release statement from Construction Partners, Inc. Investors should note that according to InvestingPro, the company’s next earnings report is scheduled for May 9, 2025, with analysts forecasting continued profitability. InvestingPro subscribers have access to 13 additional key insights about ROAD, including detailed valuation metrics and growth forecasts in the comprehensive Pro Research Report.
In other recent news, Construction Partners Inc. reported strong financial results for the first quarter of fiscal year 2025, with earnings per share (EPS) of $0.25, surpassing the forecast of $0.18. The company’s revenue reached $561.6 million, significantly exceeding the anticipated $508.75 million, marking a 41.6% year-over-year increase. This growth was bolstered by recent acquisitions and a strategic focus on infrastructure investments in the Sunbelt states. BofA Securities maintained a Buy rating on Construction Partners, despite lowering the stock’s price target to $100 from $107, following the company’s strong earnings report. The company also announced a substantial 68% year-over-year increase in EBITDA to $69 million, with a widened EBITDA margin of 12.3%. Meanwhile, DA Davidson reiterated a Neutral rating, noting the company’s robust bidding activity, particularly in Florida and North Carolina, which is expected to enhance backlog and bookings. Additionally, during its annual stockholders’ meeting, Construction Partners re-elected directors and ratified RSM US LLP as its independent registered public accountants. These developments reflect a positive outlook for the company, supported by strategic growth initiatives and strong financial performance.
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