Construction Partners, Inc. (ROAD) Hits Fresh High: Is There Still Room to Run?

Have you been paying attention to shares of Construction Partners (ROAD)? Shares have been on the move with the stock up 29% over the past month. The stock hit a new 52-week high of $103.24 in the previous session. Construction Partners has gained 133.5% since the start of the year compared to the 29.5% move for the Zacks Construction sector and the 28.2% return for the Zacks Building Products - Miscellaneous industry.What's Driving the Outperformance?The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on November 21, 2024, Construction Partners reported EPS of $0.58 versus consensus estimate of $0.57 while it beat the consensus revenue estimate by 0.12%.For the current fiscal year, Construction Partners is expected to post earnings of $1.96 per share on $2.56 billion in revenues. This represents a 47.37% change in EPS on a 40.36% change in revenues. For the next fiscal year, the company is expected to earn $2.35 per share on $2.8 billion in revenues. This represents a year-over-year change of 19.73% and 9.38%, respectively.Valuation MetricsConstruction Partners may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.Construction Partners has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.In terms of its value breakdown, the stock currently trades at 51.8X current fiscal year EPS estimates, which is a premium to the peer industry average of 20X. On a trailing cash flow basis, the stock currently trades at 32.8X versus its peer group's average of 16.1X. Additionally, the stock has a PEG ratio of 1.21. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.Zacks RankWe also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Construction Partners currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Construction Partners fits the bill. Thus, it seems as though Construction Partners shares could still be poised for more gains ahead.Must-See: Solar Stocks Poised to SkyrocketThe solar industry stands to bounce back as tech companies and the economy transition away from fossil fuels to power the AI boom.Trillions of dollars will be invested in clean energy over the coming years – and analysts predict solar will account for 80% of the renewable energy expansion. This creates an outsized opportunity to profit in the near-term and for years to come. But you have to pick the right stocks to get into.Discover Zacks’ hottest solar stock recommendation FREE.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Construction Partners, Inc. (ROAD): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks