Construction Partners, Inc., an infrastructure and road construction company, provides construction products and services to public and private sectors. Its services cover construction of highways, roads, bridges, airports, and commercial and residential sites. The company provides site development, paving, utility and drainage systems, as well as supplies hot mix asphalt. It serves customers primarily in Alabama, Florida, Georgia, North Carolina, and South Carolina. 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 founded in 2001 and is based in Dothan, Alabama.
ROAD Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for ROAD, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Construction Partners Inc ranked in the 52th percentile in terms of potential gain offered. The most interesting components of our discounted cash flow analysis for Construction Partners Inc ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 18.04; that's higher than 85.71% of US stocks in the Industrials sector that have positive free cash flow.
The business' balance sheet reveals debt to be 6% of the company's capital (with equity being the remaining amount). Approximately just 18.75% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
ROAD's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 3%; for context, that number is higher than 41.52% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Industrials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as ROAD, try GPN, WLDN, FSTR, TNC, and AJRD.
Construction Partners, Inc. (NASDAQ: ROAD) (the "Company"), a vertically integrated civil infrastructure company specializing in the construction and maintenance of roadways across five southeastern states, today announced that it will release its fiscal 2021 first quarter results on February 5, 2021, before the market opens. In conjunction with the earnings release, the Company has scheduled a conference call to discuss its first quarter results the same day at 9:00 a.m. Central Time (10:00 a.m. Eastern Time). The conference call may be accessed by phone or webcast, as follows: