Update shared on 05 Nov 2025
Fair value Increased 5.92%Analysts have raised their price target for Construction Partners from $123.83 to $131.17, citing stronger expected revenue growth and the positive impact of recent higher-margin acquisitions.
Analyst Commentary
Analyst updates reflect a nuanced outlook on Construction Partners, highlighting both optimism about growth prospects and some caution regarding the broader operating environment.
Bullish Takeaways- Bullish analysts see recent acquisitions in Texas and Tennessee as higher margin than previously anticipated. This supports optimism about stronger profitability.
- Upward revisions in price targets are based on improved FY26 guidance and confidence in the company’s long-term growth strategy.
- Expectations for the announcement of new long-term financial targets are viewed as a potential catalyst for share appreciation.
- Increased estimates suggest shares are attractively valued given the company’s execution and acquisition integration track record.
- Some analysts maintain a neutral stance while monitoring underlying activity in certain markets, noting potential volatility in regional demand.
- Caution remains around the sustainability of current growth rates, particularly as integration of new acquisitions progresses.
- Valuation concerns persist for those awaiting further clarity on execution of long-term objectives and the pace of margin improvement.
What's in the News
- Issued new earnings guidance for fiscal 2025 and 2026, projecting revenue to reach up to $2.82 billion and $3.5 billion respectively, with anticipated net income increases each year (Corporate Guidance).
- Acquired eight hot-mix asphalt plants and related operations in the Houston, Texas metro area, which strengthens regional capacity and presence (Business Expansions).
- Completed the repurchase of 293,111 shares for a total of $18.52 million as part of the ongoing buyback program (Buyback Tranche Update).
- Company leadership confirmed continued pursuit of strategic acquisitions and investments, with an emphasis on both organic growth and integrating new businesses (Seeking Acquisitions/Investments).
- Held an Analyst/Investor Day to discuss strategic initiatives, growth priorities, and business outlook (Analyst/Investor Day).
Valuation Changes
- Consensus Analyst Price Target has risen moderately, increasing from $123.83 to $131.17 per share.
- Discount Rate moved up slightly, from 8.74% to 8.89%.
- Revenue Growth expectations increased, rising from 18.00% to 20.16% year over year.
- Net Profit Margin projection fell significantly, declining from 7.15% to 5.14%.
- Future P/E multiple increased substantially, moving from 30.95x to 43.40x.
Disclaimer
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