Do analysts have more confidence in Construction Partners (NASDAQ:ROAD) in November?

ROAD Stock

USD 28.71 0.27 0.93%

Macroaxis Story

Construction Partners is scheduled to announce its earnings tomorrow. The next fiscal year end is expected on the 22nd of November 2022. As many millenniums are getting excited about industrials space, it is only fair to digest the feasibility of shorting Construction Partners. We will discuss the reasons why it is still possible for the company to generate above-average margins given the latest economic outlook.

Published over two months ago

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This firm currently holds 365.1 M in liabilities with Debt to Equity (D/E) ratio of 0.85, which is about average as compared to similar companies.

Do analysts have more confidence in Construction Partners (NASDAQ:ROAD) in November?

What is the right price you would pay to acquire a share of Construction Partners? For most investors, it would be the price that gives them a wide margin of safety to have minimal downside risk. In other words, most investors are always looking for undervalued stocks. Even if the future performance is not entirely as expected, the loss of holding it is minimized, and the downside risk is negated.

Please read more on our stock advisor page.

What is happening with Construction Partners this year

Annual and quarterly reports issued by Construction Partners are formal financial statements that are published yearly and quarterly and sent to Construction stockholders. The reports show and break down the current year's ongoing operations and discuss plans for the upcoming year. Annual reports have been a requirement from the Securities and Exchange Commission (SEC) for businesses owned by the public since 1934.

Companies such as Construction Partners often view their annual report as an effective marketing tool to disseminate their perspective on company future earnings or innovations. With this in mind, many companies devote large sums of money to making their reports attractive and informative. In such instances, the annual report becomes a forum through which a company can communicate to the general public any number of topics that may or may not be directly related to the actual data published in the reports.

How does Construction utilize its cash?

To perform a cash flow analysis of Construction Partners, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Construction Partners is receiving and how much cash it distributes out in a given period. The Construction Partners cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.

Construction Partners Net Cash Flow from Operations is projected to increase significantly based on the last few years of reporting. The past year's Net Cash Flow from Operations was at 43.65 Million

Breaking down Construction Partners Indicators

Earning per share calculations of the firm is based on official Zacks consensus of 4 analysts regarding Construction Partners' future annual earnings. Given the historical accuracy of 40.66%, the future earnings per share of the company is estimated to be 0.84 with the lowest and highest values of 0.7 and 0.94, respectively. Please note that this consensus of annual earnings estimates for Construction Partners is an estimate of EPS before non-recurring items and including employee stock options expenses.

Is Construction a risky opportunity?

Let's check the volatility. Construction is looking slightly risky at this time. Whether you invest your money or manage your clients' funds, remember that it is easy to forget that behind Construction (NASDAQ:ROAD) stock is an actual business venture. So, do not let stock picking become an abstract concept by ignoring the elementary risk calculations. purchasing a share of a Construction Partners stock makes you a part-owner of that company.

Construction Partners Current Consensus

Here is the latest trade recommendation based on an ongoing consensus estimate among financial analysis covering Construction Partners. The Construction consensus assessment is calculated by taking the average estimates from all of the analysts covering Construction Partners

Strong Buy

Buy

Hold

Strong Buy	3	60.0
Buy	1	20.0
Hold	1	20.0
Sell	0	0.0
Strong Sell	0	0.0

Will price continue to surge in December 2022?

Construction Partners latest mean deviation ascents over 2.18. Construction Partners currently demonstrates below-average downside deviation. It has Information Ratio of 0.05 and Jensen Alpha of 0.14. However, we advise investors to further question Construction Partners expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Construction Partners' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Construction Partners' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Although some firms under the engineering & construction industry are still a bit expensive, Construction Partners may offer a potential longer-term growth to shareholders. With a relatively neutral outlook on the latest economy, it is better to hold off any trading of Construction as the current risk-reward utility is not appealing enough. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to Construction Partners.

Editorial Staff

Raphi Shpitalnik is a Junior Member of Macroaxis Editorial Board. Raphael is a young entrepreneur who joined Macroaxis on a part-time basis at the beginning of the pandemic and eventually acquired a real taste for investing and fintech. He likes to analyze different equity instruments across a wide range of industries, focusing primarily on consumer products, sports, fintech, cannabis, and AI. View Profile

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Construction Partners. Please refer to our Terms of Use for any information regarding our disclosure principles.

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