Construction Partners, Inc. (NASDAQ:ROAD) Released Earnings Last Week And Analysts Lifted Their Price Target To US$101

It's been a pretty great week for Construction Partners, Inc. (NASDAQ:ROAD) shareholders, with its shares surging 11% to US$101 in the week since its latest full-year results. Results were roughly in line with estimates, with revenues of US$1.8b and statutory earnings per share of US$1.31. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Construction Partners

Taking into account the latest results, the most recent consensus for Construction Partners from five analysts is for revenues of US$2.53b in 2025. If met, it would imply a substantial 39% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to jump 59% to US$1.96. Before this earnings report, the analysts had been forecasting revenues of US$2.48b and earnings per share (EPS) of US$1.89 in 2025. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.

With these upgrades, we're not surprised to see that the analysts have lifted their price target 12% to US$101per share. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Construction Partners, with the most bullish analyst valuing it at US$112 and the most bearish at US$90.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Of course, another way to look at these forecasts is to place them into context against the industry itself. The analysts are definitely expecting Construction Partners' growth to accelerate, with the forecast 39% annualised growth to the end of 2025 ranking favourably alongside historical growth of 20% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 8.4% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Construction Partners to grow faster than the wider industry.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Construction Partners following these results. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Construction Partners going out to 2026, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Construction Partners that you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.