DOTHAN, Ala. - Construction Partners, Inc. (NASDAQ: NASDAQ:ROAD), a company specializing in the construction and maintenance of roadways with a market capitalization of $4.91 billion, announced today the acquisition of Overland Corporation, an asphalt manufacturing and paving company based in Ardmore, Oklahoma. The company, which has delivered an impressive 114% return over the past year according to InvestingPro data, is currently trading above its Fair Value. This strategic move allows Construction Partners to extend its reach into Oklahoma and northern Texas, marking its entry into an eighth state.
Overland operates eight hot-mix asphalt plants and has established itself as a notable infrastructure contractor in its local markets. CPI’s President and CEO, Fred J. (Jule) Smith, III, remarked on the cultural and operational alignment of the two companies, emphasizing the growth opportunities in the region, particularly as the Dallas metro area continues to expand. This strategic move aligns with the company’s strong revenue growth of 16.7% over the last twelve months, with analysts anticipating continued sales growth according to InvestingPro analysis.
The acquisition is in line with CPI’s strategy to manage its leverage ratio, aiming to reduce it to approximately 2.5x within the next four to six quarters to support sustainable growth. This approach reflects CPI’s broader business model, which includes a mix of publicly funded projects, such as roadways, highways, runways, and bridges, as well as private sector projects.
Construction Partners, Inc. operates across the Sunbelt, with a network of hot-mix asphalt plants, aggregate facilities, and liquid asphalt terminals to support its infrastructure projects. The company has a significant presence in Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee, and Texas.
The statement released today by CPI also contained forward-looking statements, cautioning that such statements involve risks and uncertainties that could alter actual results. These forward-looking statements include predictions about the benefits and expected results of the Overland acquisition.
The company’s expansion into Oklahoma is anticipated to bolster its position in the infrastructure sector, leveraging Overland’s local market presence and expertise. With annual revenue of $1.82 billion and a healthy current ratio of 1.54, Construction Partners demonstrates solid financial footing for this expansion. This information is based on a press release statement from Construction Partners, Inc. For deeper insights into ROAD’s financial health, growth prospects, and 18 additional exclusive ProTips, visit InvestingPro.
In other recent news, Construction Partners reported a record fiscal year in 2024, with revenue growing by 17% to $1.82 billion and net income up by 41% to $68.9 million. The company’s adjusted EBITDA also saw a significant rise of 28%, reaching $220.6 million. DA Davidson, considering these results and the contributions from the Lone Star Paving acquisition, raised the price target for Construction Partners to $95.00 from the previous target of $75.00, while maintaining a neutral rating on the stock. In addition to the Lone Star Paving acquisition, Construction Partners completed eight acquisitions in fiscal 2024, expanding its market share in Sunbelt states. The company anticipates robust demand in commercial and public markets, backed by the Infrastructure Investment and Jobs Act. For fiscal 2025, Construction Partners projects increased revenue between $2.48 billion and $2.58 billion, and adjusted EBITDA between $347 million and $377 million. These are among the recent developments for Construction Partners.
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