Granite Construction (GVA): Evaluating Valuation After Major $138 Million Chicago Bridge Project Win

Granite Construction (NYSE:GVA) has kicked off a $138 million rehabilitation effort on Chicago's Lake Street Bascule Bridge, following an award from the Chicago Department of Transportation. The project highlights Granite’s role in major infrastructure builds.

See our latest analysis for Granite Construction.

Granite Construction has been making headlines not just for landing high-profile contracts, but also for expanding its footprint. The company recently acquired a Nevada-based aggregates company as part of its growth strategy. While the company’s 1-day and 7-day share price returns have slipped, momentum has been building over the long haul, with a 17.9% year-to-date share price return and a remarkable 26.2% total shareholder return over the past year, highlighting both resilience and renewed investor interest.

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With shares still trading at a notable discount to analyst targets despite strong business wins and robust long-term returns, investors may wonder whether Granite Construction is undervalued or if the market is already reflecting expectations for future growth.

Most Popular Narrative: 21.5% Undervalued

Granite Construction's widely followed fair value estimate stands at $132 per share, compared to the recent close of $103.66. This sizable difference sets the stage for an ambitious outlook on the company’s potential gains.

Recent acquisitions expand Granite's reach in high-growth Sunbelt and Western states as well as its materials vertical. This positions the company to benefit from long-term urbanization, population growth, and private sector development, fueling sustained revenue and volume expansion. Increasing vertical integration in aggregates and materials supply, enhanced by automation and operational best practices, is expected to deliver higher margins and greater earnings stability by improving cost control and reducing exposure to input cost volatility.

Read the complete narrative.

Want to know what bold assumptions drive this sharp upside target? The secret is in growth beyond just headline figures. Consider margin upgrades and future profit multiples that signal a valuation shift. See which surprising projections underpin this bullish narrative.

Result: Fair Value of $132 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this outlook could quickly shift if integration missteps from recent acquisitions or cost inflation erode margins more than expected, which could challenge Granite's momentum.

Find out about the key risks to this Granite Construction narrative.

Build Your Own Granite Construction Narrative

If you see the numbers differently or want to dig deeper, you can easily build your own narrative using the data at hand in just a few minutes. Do it your way

A great starting point for your Granite Construction research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

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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.

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