Construction Partners (ROAD) AI Stock Analysis

• Market Cap: $7.85B
• Dividend Yield: N/A
• Average Volume (3M): 555.29K
• Price to Earnings (P/E): 63.5
• Beta (1Y): 1.59
• Revenue Growth: 54.20%
• EPS Growth: 38.64%
• Country: US
• Employees: 1,325
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 0.47
• Shares Outstanding: 47,966,260
• 10 Day Avg. Volume: 620,542
• 30 Day Avg. Volume: 555,287
• 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: 1.23
• Enterprise Value/Revenue: 3.15
• Enterprise Value/Gross Profit: 19.94
• Enterprise Value/Ebitda: 22.62
• 1Y Price Target: $135.33
• Price Target Upside: -2.56% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): 2.9
• Revenue Forecast (FY): $3.50B

• Rating: 72 Outperform
• Price Target: $142.00 ▲(2.25% Upside)
• Action: Reiterated Date: 02/06/26
• Date: Action: Reiterated 02/06/26

Score is driven primarily by improving financial performance (rapid revenue scale, margin expansion, stronger recent cash flow) and strong technical momentum (price above major moving averages with positive MACD). The biggest constraint is valuation (high 58.36 P/E with no dividend yield provided). Earnings call tone is supportive due to raised FY2026 guidance and strong backlog/cash outlook, tempered by elevated leverage and a Q1 organic-growth shortfall.

Positive Factors

Sustained revenue growth & margin expansion

ROAD has scaled revenue materially over several years while expanding gross and EBIT margins, indicating improving operational leverage and pricing/pasteurization of inputs. That structural margin improvement supports durable profitability as volumes and mix normalize across cycles.

Improved cash generation and free cash flow

Operating cash flow and free cash flow have meaningfully recovered from prior weak years, demonstrating better working-capital management and converting EBITDA to cash. Stronger cash generation underpins debt paydown, reinvestment in plants, and funding of acquisitive growth over the medium term.

Robust backlog and acquisitive expansion

A large, covered backlog plus targeted acquisitions (e.g., GMJ plant addition) provide predictable revenue conversion and market share gains in key Southeast regions. This structural pipeline and bolt-on M&A strategy support sustained revenue visibility and higher regional scale.

Negative Factors

Inconsistent leverage and balance-sheet swings

Sharp swings in reported leverage suggest material financing or reporting changes and create uncertainty about balance-sheet comparability. Elevated leverage episodically limits flexibility and raises refinancing and covenant risk if cash generation weakens during seasonality or integration periods.

Moderate cash conversion and cyclicality

Despite recent FCF improvement, only moderate conversion of earnings to cash and a history of negative FCF highlight exposure to working-capital swings and seasonality. This structural cash volatility can constrain investment pacing and deleveraging during down cycles.

Organic growth shortfall and local competitive pressure

Below-target organic growth and localized aggressive pricing indicate pockets of margin pressure and execution risk. Reliance on acquisitive growth to hit targets may mask underlying market share challenges and makes sustainable margin expansion dependent on successful integrations.

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 scale-up and margin improvement (revenue up to ~$3.06B TTM; EBIT margin ~7.0% TTM vs ~2.8% FY2022) with much stronger recent operating and free cash flow (OCF $333M TTM; FCF $187M TTM). The main offset is balance-sheet inconsistency (large swing in leverage between FY2025 annual and TTM) and only moderate cash conversion (~56% FCF to net income TTM).

Income Statement

ROAD shows strong top-line momentum, with revenue rising from ~$0.91B (2021) to $2.81B (FY2025) and $3.06B in TTM (Trailing-Twelve-Months), alongside improving profitability. Gross margin expanded from ~10.5% (FY2022) to ~15.8% (TTM), and operating profitability improved with EBIT margin reaching ~7.0% (TTM) vs ~2.8% (FY2022). Net margin remains modest for the sector (~4.0% TTM), and revenue growth is uneven year to year (notably very strong in FY2022, much lower in FY2025 annual), which tempers the score.

Balance Sheet

Leverage looks inconsistent across periods: debt-to-equity is very low in TTM (~0.14) but was high in FY2025 annual (~1.85), signaling either a meaningful deleveraging event or reporting mix that warrants caution. Equity has grown (to ~$969M in TTM), and returns on equity are solid and improving versus earlier years (~12% TTM vs ~5% in FY2021–FY2022). The key weakness is the sharp swing in leverage, which raises questions around balance-sheet stability and comparability.

Cash Flow

Cash generation is generally supportive: operating cash flow improved from very weak FY2022 levels to $291M (FY2025) and $333M in TTM (Trailing-Twelve-Months), with free cash flow also rising to $153M (FY2025) and $187M (TTM). Free cash flow growth is strong in TTM (+21.69%). However, cash conversion versus earnings is only moderate (free cash flow is ~56% of net income in TTM), and the earlier history includes negative free cash flow (FY2021–FY2022), suggesting cyclicality and working-capital swings remain a risk.

Breakdown	TTM	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	3.06B	2.81B	1.82B	1.56B	1.30B	910.74M
Gross Profit	484.02M	439.09M	258.50M	198.98M	137.12M	116.79M
EBITDA	426.68M	373.17M	214.72M	170.15M	102.61M	80.73M
Net Income	122.04M	101.77M	68.94M	49.00M	21.38M	20.18M
Balance Sheet
Total Assets	3.36B	3.24B	1.54B	1.22B	1.10B	806.62M
Cash, Cash Equivalents and Short-Term Investments	104.09M	156.06M	74.69M	48.24M	35.53M	57.25M
Total Debt	1.91B	1.69B	553.25M	390.73M	389.83M	222.87M
Total Liabilities	2.39B	2.33B	968.39M	703.09M	639.64M	397.72M
Stockholders Equity	969.15M	911.96M	573.74M	516.57M	455.88M	408.90M
Cash Flow
Free Cash Flow	186.64M	153.37M	121.15M	59.35M	-52.35M	-7.83M
Operating Cash Flow	333.21M	291.30M	209.08M	157.16M	16.50M	48.50M
Investing Cash Flow	-844.01M	-1.28B	-307.58M	-143.37M	-197.33M	-263.41M
Financing Cash Flow	481.93M	1.07B	126.11M	-264.00K	159.14M	123.85M

Construction Partners Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 138.88
• 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 138.88 is above the 20-day moving average (MA) of 123.88, above the 50-day MA of 116.62, and above the 200-day MA of 112.54, indicating a bullish trend. The MACD of 5.18 indicates Negative momentum. The RSI at 61.36 is Neutral, neither overbought nor oversold. The STOCH value of 33.12 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	$8.21B	33.02	18.56%	0.25%	21.45%	67.31%
KBR	73 Outperform	$5.35B	13.70	27.77%	1.65%	9.66%	29.01%
ROAD	72 Outperform	$7.85B	63.49	13.71%	―	54.20%	38.64%
STRL	71 Outperform	$14.12B	45.08	35.73%	―	6.20%	72.81%
GVA	70 Outperform	$5.92B	37.10	17.59%	0.45%	6.87%	64.56%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
FLR	55 Neutral	$7.78B	-42.32	-1.42%	―	-1.81%	1228.51%

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.