Construction Partners currently trades at $108.89 and has been a dream stock for shareholders. It’s returned 565% since July 2020, blowing past the S&P 500’s 96.3% gain. The company has also beaten the index over the past six months as its stock price is up 20.6% thanks to its solid quarterly results.
Is it too late to buy ROAD? Find out in our full research report, it’s free.
Why Is ROAD a Good Business?
Founded in 2001, Construction Partners (NASDAQ:ROAD) is a civil infrastructure company that builds and maintains roads, highways, and other infrastructure projects.
1. Projected Revenue Growth Is Remarkable
Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite, though some deceleration is natural as businesses become larger.
Over the next 12 months, sell-side analysts expect Construction Partners’s revenue to rise by 40.5%, an improvement versus its 22% annualized growth for the past five years. This projection is eye-popping and suggests its newer products and services will fuel better top-line performance.
2. Outstanding Long-Term EPS Growth
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
Construction Partners’s EPS grew at a remarkable 13.6% compounded annual growth rate over the last five years. This performance was better than most industrials businesses.
3. New Investments Bear Fruit as ROIC Jumps
A company’s ROIC, or return on invested capital, shows how much operating profit it makes compared to the money it has raised (debt and equity).
We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. Over the last few years, Construction Partners’s ROIC averaged 1.8 percentage point increases each year. its rising ROIC is a good sign and could suggest its competitive advantage or profitable growth opportunities are expanding.
Final Judgment
These are just a few reasons why we think Construction Partners is a great business, and with its shares topping the market in recent months, the stock trades at 45.6× forward P/E (or $108.89 per share). Is now a good time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More Than Construction Partners
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.