Download PDF

1. Company Snapshot

1.a. Company Description

Construction Partners, Inc., a civil infrastructure company, engages in the construction and maintenance of roadways across Alabama, Florida, Georgia, North Carolina, and South Carolina.The company, through its subsidiaries, provides various products and services to public and private infrastructure projects, with a focus on highways, roads, bridges, airports, and commercial and residential developments.It also engages in manufacturing and distributing hot mix asphalt (HMA) for internal use and sales to third parties in connection with construction projects; paving activities, including the construction of roadway base layers and application of asphalt pavement; site development, including the installation of utility and drainage systems; mining aggregates, such as sand and gravel that are used as raw materials in the production of HMA; and distributing liquid asphalt cement for internal use and sales to third parties in connection with HMA production.


The company was formerly known as SunTx CPI Growth Company, Inc.and changed its name to Construction Partners, Inc.in September 2017.


Construction Partners, Inc.was incorporated in 1999 and is headquartered in Dothan, Alabama.

Show Full description

1.b. Last Insights on ROAD

Construction Partners, Inc.'s recent performance was negatively impacted by its Q4 2025 earnings miss, with quarterly earnings of $1.07 per share falling short of the Zacks Consensus Estimate of $1.11 per share. Despite a 54% year-over-year revenue growth and a record backlog of $3.0 billion, the company's earnings miss and subsequent analyst downgrades have been a drag. Analysts have cut their forecasts following the Q4 results, citing mixed financial performance. The company's fiscal 2025 results showed net income up 48% and adjusted EBITDA up 92% year-over-year.

1.c. Company Highlights

2. Construction Partners' Fiscal 2025: A Transformational Year

Construction Partners (CPI) reported a remarkable fiscal 2025 with total revenue surging 54% to $2.812 billion, driven by strategic acquisitions and 8.4% organic growth. Adjusted EBITDA reached $423.7 million, a 92% increase year-over-year, with a record EBITDA margin of 15%. The company's earnings per share (EPS) came in at $1.07, slightly below estimates of $1.11. Revenue for the fourth quarter stood at $900 million, up 67% year-over-year, with adjusted EBITDA of $154 million. The company's project backlog ended the year at a record $3 billion.

Publication Date: Nov -23

📋 Highlights
  • 2025 Revenue & EBITDA Surge: Achieved $2.812B revenue (+54% YoY) and $423.7M adjusted EBITDA (+92% YoY), with a record 15% EBITDA margin.
  • Road 2030 Growth Targets: Aims for $6B revenue by 2030, 17% EBITDA margin, and $1B+ adjusted EBITDA by 2030 (18% CAGR).
  • 2026 Guidance: Projects $3.435B revenue, $520-540M adjusted EBITDA, and $150-155M net income, with 15% contract award growth.
  • Acquisition Impact: 2025 acquisitions added $240-250M revenue, with 2026 deals adding $200M, maintaining margin stability via smooth integration.
  • Balance Sheet Strength: $156M cash, $303.5M credit facility, and debt-to-EBITDA target reduction to 2.5x by late 2026.

Growth Strategy and Outlook

CPI's growth strategy focuses on the Sunbelt region, driven by migration, reshoring, and infrastructure investments. The company outlined a new five-year plan, Road 2030, targeting over $6 billion in revenue by 2030 and a 17% EBITDA margin. For 2026, CPI expects revenue in the range of $3.435 billion, net income between $150-155 million, and adjusted EBITDA between $520-540 million, representing a 22.1% revenue growth, in line with analyst estimates.

Acquisition Strategy and Integration

CPI's acquisition strategy focuses on the right markets with the right partners, taking advantage of a generational transition in the industry. The company has a strong team for acquisitions and integration, with a focus on cultural fit and including employees throughout the company in the integration process. The 2025 acquisitions carried over $240-$250 million in revenue, with 2026 acquisitions adding another $200 million, having a combined impact neutral to the current margin position.

Financial Position and Deleveraging

The company has a strong balance sheet with $156 million in cash and $303.5 million available under its credit facility. It aims to reduce its debt-to-EBITDA ratio to approximately 2.5 times by late 2026, currently standing at a manageable level. With a Net Debt / EBITDA ratio of -0.12, CPI's financial position is robust.

Valuation

With a P/E Ratio of 54.88 and an EV/EBITDA of 16.8, the market is pricing in significant growth expectations. The P/S Ratio stands at 2.02, indicating a premium valuation. However, given CPI's growth prospects and expanding margins, the current valuation may be justified. As the company continues to execute its growth strategy and deleverage, investors may be rewarded with long-term returns.

3. NewsRoom

Card image cap

Advisors Asset Management Inc. Has $7.29 Million Position in Construction Partners, Inc. $ROAD

Nov -26

Source: defenseworld.net

Card image cap

These Analysts Cut Their Forecasts On Construction Partners After Q4 Results

Nov -21

Source: benzinga.com

Card image cap

Construction Partners, Inc. (ROAD) Q4 2025 Earnings Call Transcript

Nov -20

Source: seekingalpha.com

Card image cap

Construction Partners (ROAD) Misses Q4 Earnings and Revenue Estimates

Nov -20

Source: zacks.com

Card image cap

Construction Partners, Inc. Announces Fiscal 2025 Fourth Quarter and Full Year Results

Nov -20

Source: prnewswire.com

Card image cap

Construction Partners (ROAD) Earnings Expected to Grow: Should You Buy?

Nov -13

Source: zacks.com

Card image cap

Construction Partners, Inc. Announces Schedule for Fiscal 2025 Fourth Quarter and Full Year Earnings Release and Conference Call

Nov -06

Source: prnewswire.com

Card image cap

Best Growth Stocks to Buy for Oct. 23

Oct -23

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (14.00%)

6. Segments

Infrastructure and Road Construction

Expected Growth: 14%

Strong demand for infrastructure development, increasing government investments in road construction, and strategic partnerships with local authorities drive the 14% growth of Infrastructure and Road Construction from Construction Partners, Inc. Additionally, the company's focus on sustainable and environmentally-friendly projects, as well as its ability to navigate complex regulatory environments, contribute to its success.

7. Detailed Products

Asphalt Paving

Construction Partners, Inc. provides high-quality asphalt paving services for roads, highways, and commercial properties.

Site Preparation

The company offers site preparation services, including land clearing, excavation, and grading, to prepare sites for construction projects.

Concrete Services

Construction Partners, Inc. provides concrete services, including concrete paving, curbs, and sidewalks, for various construction projects.

Bridge Construction

The company specializes in bridge construction, rehabilitation, and repair services for highways, roads, and local governments.

Utility Installation

Construction Partners, Inc. provides utility installation services, including water, sewer, and storm drain systems, for various construction projects.

Earthwork and Grading

The company offers earthwork and grading services, including excavation, filling, and grading, for construction projects.

8. Construction Partners, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes is low for Construction Partners, Inc. because the company's specialized services and strong relationships with clients create a high barrier to entry for potential substitutes.

Bargaining Power Of Customers

The bargaining power of customers is medium for Construction Partners, Inc. because while clients have some negotiating power, the company's reputation and expertise in the industry limit their ability to dictate prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low for Construction Partners, Inc. because the company's large scale of operations and strong relationships with suppliers give it significant negotiating power.

Threat Of New Entrants

The threat of new entrants is high for Construction Partners, Inc. because the industry is attractive and there are low barriers to entry, making it easy for new companies to enter the market.

Intensity Of Rivalry

The intensity of rivalry is medium for Construction Partners, Inc. because while there is some competition in the industry, the company's strong reputation and differentiated services help to mitigate the impact of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 43.06%
Debt Cost 5.93%
Equity Weight 56.94%
Equity Cost 7.33%
WACC 6.73%
Leverage 75.64%

11. Quality Control: Construction Partners, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
AECOM

A-Score: 5.5/10

Value: 3.5

Growth: 5.7

Quality: 5.2

Yield: 1.0

Momentum: 8.0

Volatility: 9.7

1-Year Total Return ->

View Full Report
Stock-Card
API Group

A-Score: 5.4/10

Value: 2.5

Growth: 6.4

Quality: 6.4

Yield: 0.0

Momentum: 8.5

Volatility: 8.3

1-Year Total Return ->

View Full Report
Stock-Card
Dycom Industries

A-Score: 5.0/10

Value: 2.4

Growth: 8.0

Quality: 4.9

Yield: 0.0

Momentum: 9.0

Volatility: 5.7

1-Year Total Return ->

View Full Report
Stock-Card
TopBuild

A-Score: 4.8/10

Value: 3.5

Growth: 9.0

Quality: 6.4

Yield: 0.0

Momentum: 5.0

Volatility: 5.0

1-Year Total Return ->

View Full Report
Stock-Card
MYR Group

A-Score: 4.7/10

Value: 3.2

Growth: 4.9

Quality: 5.8

Yield: 0.0

Momentum: 9.5

Volatility: 4.7

1-Year Total Return ->

View Full Report
Stock-Card
Construction Partners

A-Score: 4.5/10

Value: 1.5

Growth: 8.6

Quality: 3.4

Yield: 0.0

Momentum: 9.0

Volatility: 4.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

103.04$

Current Price

103.04$

Potential

-0.00%

Expected Cash-Flows