Construction Partners (ROAD) AI Stock Analysis

• Market Cap: $6.45B
• Dividend Yield: N/A
• Average Volume (3M): 385.37K
• Price to Earnings (P/E): 64.5
• Beta (1Y): 1.65
• Revenue Growth: 54.20%
• EPS Growth: 38.64%
• Country: US
• Employees: 1,325
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): N/A
• Shares Outstanding: 47,956,257
• 10 Day Avg. Volume: 318,633
• 30 Day Avg. Volume: 385,368
• PEG Ratio: 1.75
• Price to Book (P/B): 7.65
• Price to Sales (P/S): 2.48
• P/FCF Ratio: 45.50
• Enterprise Value/Market Cap: 1.27
• Enterprise Value/Revenue: 2.91
• Enterprise Value/Gross Profit: 18.62
• Enterprise Value/Ebitda: 21.57
• 1Y Price Target: $118.67
• Price Target Upside: 0.94% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 73 Outperform
• Price Target: $123.00 ▲(4.63% Upside)

The score is driven primarily by strong operating performance and cash generation, supported by a bullish earnings outlook (record backlog and solid FY2026 guidance). The biggest constraints are balance-sheet leverage risk and a demanding valuation (P/E 60.24), while technical indicators are neutral to slightly soft.

Positive Factors

Strong cash generation

Sustained free cash flow growth and an OCF-to-net-income ratio well above 1 indicate durable internal funding. This supports capex for plant expansions, working-capital needs for projects, and the ability to pay down debt or fund acquisitions without relying solely on external financing.

Record backlog and clear multi-year guidance

A $3B backlog and explicit FY2026 revenue/EBITDA guidance provide multi-quarter visibility into demand and cash flows, enabling better capacity planning and investment decisions. This reduces revenue volatility and underpins sustainable margin improvement targets over coming years.

Strategic Sunbelt/Houston expansion

Incremental plant capacity and deeper local teams in a fast-growing Sunbelt market strengthen market share and routing economics. Enhanced terminal throughput and customer ties create durable operational scale advantages and potential margin uplift across regional operations.

Negative Factors

High leverage burden

Elevated leverage increases interest and refinancing risk and constrains strategic flexibility. With management targeting reduced leverage by late 2026, excessive debt could still limit ability to invest organically or weather project delays, making deleveraging execution critical to stability.

Heavy reliance on acquisitions for growth

A large portion of recent growth coming from acquisitions raises execution and integration risk, and growth sustainability depends on continued M&A appetite and deal quality. If acquisition pace slows, reported growth could revert toward lower organic trends, pressuring future revenue targets.

Low net profit margin versus gross margins

The spread between rising gross margins and a low net margin suggests high fixed costs, interest burden, or other overheads compressing bottom-line returns. Low net margins reduce resilience against input cost swings and make it harder to accelerate deleveraging or self-fund strategic initiatives.

Construction Partners Business Overview & Revenue Model

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.

How the Company Makes Money

Construction Partners generates revenue primarily through the sale of asphalt and concrete products, as well as services related to road construction and maintenance. The company's revenue model is built on contract-based projects where it partners with government agencies and private entities to fulfill their infrastructure needs. Key revenue streams include the direct sale of construction materials, project management fees, and service contracts for road maintenance. The company also benefits from strategic partnerships with local and state governments, as well as other construction firms, which help secure long-term contracts and ensure a steady flow of work. Additionally, favorable market conditions, such as increased public spending on infrastructure, significantly contribute to its earnings.

Construction Partners Financial Statement Overview

Summary

Strong income statement and cash flow trends (revenue up 14.76%, improving gross/EBIT margins, free cash flow up 36.8%, operating cash flow-to-net income 2.86). Main offset is higher leverage on the balance sheet (debt-to-equity 1.85), which increases risk despite solid ROE (11.16%).

Income Statement

Construction Partners has demonstrated strong revenue growth with a 14.76% increase in the latest year, supported by improving gross and EBIT margins. The gross profit margin has increased to 15.61%, reflecting efficient cost management. However, the net profit margin slightly decreased to 3.62%, indicating room for improvement in net profitability.

Balance Sheet

The company's debt-to-equity ratio has increased significantly to 1.85, indicating higher leverage, which could pose a risk if not managed carefully. Despite this, the return on equity remains solid at 11.16%, showcasing effective use of equity to generate profits. The equity ratio stands at 28.16%, suggesting a balanced approach to financing with equity.

Cash Flow

Free cash flow has grown by 36.8%, highlighting strong cash generation capabilities. The operating cash flow to net income ratio is 2.86, indicating robust cash flow relative to net income. However, the free cash flow to net income ratio is 0.53, suggesting that while cash flow is positive, there is room for improvement in converting income into free cash flow.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.81B	2.81B	1.82B	1.56B	1.30B	910.74M
Gross Profit	439.09M	439.09M	258.50M	198.98M	137.12M	116.79M
EBITDA	379.09M	373.17M	214.72M	170.15M	102.61M	80.73M
Net Income	101.78M	101.77M	68.94M	49.00M	21.38M	20.18M
Balance Sheet
Total Assets	3.24B	3.24B	1.54B	1.22B	1.10B	806.62M
Cash, Cash Equivalents and Short-Term Investments	159.01M	156.06M	74.69M	48.24M	35.53M	57.25M
Total Debt	1.69B	1.69B	553.25M	390.73M	389.83M	222.87M
Total Liabilities	2.33B	2.33B	968.39M	703.09M	639.64M	397.72M
Stockholders Equity	911.96M	911.96M	573.74M	516.57M	455.88M	408.90M
Cash Flow
Free Cash Flow	153.37M	153.37M	121.15M	59.35M	-52.35M	-7.83M
Operating Cash Flow	291.30M	291.30M	209.08M	157.16M	16.50M	48.50M
Investing Cash Flow	-1.28B	-1.28B	-307.58M	-143.37M	-197.33M	-263.41M
Financing Cash Flow	1.07B	1.07B	126.11M	-264.00K	159.14M	123.85M

Construction Partners Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 117.56
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ROAD, the sentiment is Positive. The current price of 117.56 is above the 20-day moving average (MA) of 113.17, above the 50-day MA of 110.16, and above the 200-day MA of 109.45, indicating a bullish trend. The MACD of 0.72 indicates Negative momentum. The RSI at 58.20 is Neutral, neither overbought nor oversold. The STOCH value of 67.31 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ROAD.

Construction Partners Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PRIM	75 Outperform	$8.26B	30.20	18.56%	0.25%	21.45%	67.31%
ROAD	73 Outperform	$6.45B	64.45	13.70%	―	54.20%	38.64%
KBR	73 Outperform	$5.40B	13.82	27.77%	1.65%	9.66%	29.01%
STRL	71 Outperform	$11.30B	37.93	35.73%	―	6.20%	72.81%
GVA	70 Outperform	$5.39B	36.33	16.87%	0.45%	6.87%	64.56%
FLR	64 Neutral	$7.56B	2.36	91.03%	―	-1.81%	1228.51%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Construction Partners Corporate Events

Construction Partners Expands Houston Footprint With GMJ Acquisition

On February 2, 2026, Construction Partners, Inc. announced it had completed the acquisition of GMJ Paving Company, LLC, a leading asphalt paving contractor for public infrastructure projects in the Houston, Texas metro area, along with GMJ’s hot-mix asphalt plant in Baytown. The deal marks Construction Partners’ twelfth asphalt plant in the Houston region and follows its 2025 entry into that market through acquisitions of Durwood Greene Construction Co. in August and Houston-area construction assets of Vulcan Materials Company in October, further expanding its market share, enhancing throughput at its nearby liquid asphalt terminal, and deepening its local operating team and customer relationships in one of the country’s fastest-growing infrastructure markets.

The most recent analyst rating on (ROAD) stock is a Buy with a $128.00 price target. To see the full list of analyst forecasts on Construction Partners stock, see the ROAD Stock Forecast page.

Construction Partners Amends Executive Compensation Plan

On November 4, 2025, Construction Partners, Inc.’s Compensation Committee approved an amended award agreement for performance stock unit awards under the company’s 2018 Equity Incentive Plan. The amendment allows the committee to settle these awards by paying the cash-equivalent value of the shares, impacting executive compensation and potentially affecting shareholder value.

The most recent analyst rating on (ROAD) stock is a Buy with a $129.00 price target. To see the full list of analyst forecasts on Construction Partners stock, see the ROAD Stock Forecast page.