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 49th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. In terms of the factors that were most noteworthy in this DCF analysis for ROAD, they are:
The stock's equity weight, or the proportion of capital from equity relative to debt, is 95. Notably, its equity weight is greater than 86.58% of US equities in the Industrials sector yielding a positive free cash flow.
The business' balance sheet suggests that 5% of the company's capital is sourced from debt; this is greater than only 17.48% of the free cash flow producing stocks we're observing.
ROAD's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 42.59% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
HURN, KNX, NSP, CVA, and KAI can be thought of as valuation peers to ROAD, in the sense that they are in the Industrials sector and have a similar price forecast based on DCF valuation.
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: