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Granite (GVA) Buys Lehman-Roberts & Memphis Stone & Gravel
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Granite Construction Incorporated (GVA - Free Report) has successfully acquired Lehman-Roberts Company (“LRC”) and Memphis Stone & Gravel Company (“MSG”), bolstering its presence in the Memphis metropolitan market. LRC, operating seven asphalt plants, and MSG, with three sand and gravel mines, bring a wealth of proven and probable reserves to Granite's portfolio.
Led by Pat Nelson, the senior leadership team of the acquired companies will continue to drive success within the Granite group.
This strategic move aligns with Granite's focus on developing home markets through partnerships with successful, scalable entities. The acquisition, financed through a $150 million term loan and Granite's existing resources, has prompted an upward revision of the 2024 revenue target in the range of $3.8 billion-$4.0 billion.
Granite anticipates the acquisition to be accretive to EBITDA, reinforcing its commitment to a 2024 adjusted EBITDA margin range of 9%-11%. The infusion of Lehman-Roberts and Memphis Stone & Gravel sets the stage for Granite to capitalize on the burgeoning demand for asphalt and aggregates in the Southeast.
As the construction industry continues to evolve, Granite's strategic expansion positions it as a formidable player in the market. The company's foresight in growing through targeted acquisitions underscores its commitment to delivering value to shareholders and stakeholders alike.
The company has been bolstering its materials business through both greenfield and bolt-on investments, and improved segment margins.
Image Source: Zacks Investment Research
Shares of GVA have rallied 34.2% year to date, outperforming the Zacks Building Products - Heavy Construction industry’s 17.4% rise. The consistent award wins have been driving GVA’s performance. The company is focused on growing a high-quality Committed and Awarded Projects or CAP portfolio on the back of a positive public funding environment and resilient private market.
Zacks Rank
Granite currently sports a Zacks Rank #1 (Strong Buy).
Key Picks
Here are some other top-ranked stocks from the Zacks Construction sector:
The stock has gained 9.8% year to date (YTD). The Zacks Consensus Estimate for AYI’s fiscal 2024 sales and EPS indicates a decline of 3% and 4.7%, respectively, from a year ago.
M-tron Industries, Inc. (MPTI - Free Report) currently sports a Zacks Rank of 1. MPTI delivered a trailing four-quarter earnings surprise of 35.6%, on average. It has surged 297.6% YTD.
The Zacks Consensus Estimate for MPTI’s 2023 sales and EPS indicates growth of 30.6% and 156.7%, respectively, from the previous year.
EMCOR Group, Inc. (EME - Free Report) presently sports a Zacks Rank of 1. It has a trailing four-quarter earnings surprise of 10.6%, on average. Shares of EME have rallied 42.9% YTD.
The Zacks Consensus Estimate for EME’s 2023 sales and EPS indicates an improvement of 12% and 52.8%, respectively, from the prior-year levels.
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Granite (GVA) Buys Lehman-Roberts & Memphis Stone & Gravel
Granite Construction Incorporated (GVA - Free Report) has successfully acquired Lehman-Roberts Company (“LRC”) and Memphis Stone & Gravel Company (“MSG”), bolstering its presence in the Memphis metropolitan market. LRC, operating seven asphalt plants, and MSG, with three sand and gravel mines, bring a wealth of proven and probable reserves to Granite's portfolio.
Led by Pat Nelson, the senior leadership team of the acquired companies will continue to drive success within the Granite group.
This strategic move aligns with Granite's focus on developing home markets through partnerships with successful, scalable entities. The acquisition, financed through a $150 million term loan and Granite's existing resources, has prompted an upward revision of the 2024 revenue target in the range of $3.8 billion-$4.0 billion.
Granite anticipates the acquisition to be accretive to EBITDA, reinforcing its commitment to a 2024 adjusted EBITDA margin range of 9%-11%. The infusion of Lehman-Roberts and Memphis Stone & Gravel sets the stage for Granite to capitalize on the burgeoning demand for asphalt and aggregates in the Southeast.
As the construction industry continues to evolve, Granite's strategic expansion positions it as a formidable player in the market. The company's foresight in growing through targeted acquisitions underscores its commitment to delivering value to shareholders and stakeholders alike.
The company has been bolstering its materials business through both greenfield and bolt-on investments, and improved segment margins.
Image Source: Zacks Investment Research
Shares of GVA have rallied 34.2% year to date, outperforming the Zacks Building Products - Heavy Construction industry’s 17.4% rise. The consistent award wins have been driving GVA’s performance. The company is focused on growing a high-quality Committed and Awarded Projects or CAP portfolio on the back of a positive public funding environment and resilient private market.
Zacks Rank
Granite currently sports a Zacks Rank #1 (Strong Buy).
Key Picks
Here are some other top-ranked stocks from the Zacks Construction sector:
Acuity Brands, Inc. (AYI - Free Report) currently carries a Zacks Rank of 2 (Buy). AYI delivered a trailing four-quarter earnings surprise of 12%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The stock has gained 9.8% year to date (YTD). The Zacks Consensus Estimate for AYI’s fiscal 2024 sales and EPS indicates a decline of 3% and 4.7%, respectively, from a year ago.
M-tron Industries, Inc. (MPTI - Free Report) currently sports a Zacks Rank of 1. MPTI delivered a trailing four-quarter earnings surprise of 35.6%, on average. It has surged 297.6% YTD.
The Zacks Consensus Estimate for MPTI’s 2023 sales and EPS indicates growth of 30.6% and 156.7%, respectively, from the previous year.
EMCOR Group, Inc. (EME - Free Report) presently sports a Zacks Rank of 1. It has a trailing four-quarter earnings surprise of 10.6%, on average. Shares of EME have rallied 42.9% YTD.
The Zacks Consensus Estimate for EME’s 2023 sales and EPS indicates an improvement of 12% and 52.8%, respectively, from the prior-year levels.