ROAD

"So if the data center or AI trades do slow down in the market, then I think that construction partners could get hit along with it to an extent. But fundamentally, I don't think that this is a huge portion of their backlog or their actual fundamentals. And over the long term, I think that this business is going to continue growing and compounding away. So if it does see any weakness on the AI trade selling off at any point, then personally, I think that it is an opportunity for me to buy more sh"

"And even with this pretty pessimistic DCF, the stock could still produce a market beating return of almost 12% annually. And this is ultimately why I added more shares to my position today because the company is continuing to grow and execute extremely well. And I continue to believe that they are actually going to beat their guidance. And if they do, then I think the stock could produce over 20% annual returns out to 2030."

"So now let's talk about roads valuation. They are expecting $565 million of IBITA for this year."

"This company is construction partners with the ticker symbol road. And in today's video, I want to go through the earnings report, show you all of the highlights and what I think investors need to know. And I will also be explaining why I think the stock is looking cheap and also why I purchased even more shares in the market today."

"So next year is most likely going to be another year of 20% plus growth for construction partners which I think is very good especially considering the stock price in my opinion is offering a lot of value today."

"And personally, I do think that they will actually surpass their 2030 targets because Construction Partners has a history of sandbagging their guidance and then absolutely smashing it."

"And overall, I do think that this report was a business asusual report for construction partners. And I think that the share price reaction today is just the market correcting itself and realizing that hey this is actually a good business and maybe it shouldn't sell for as much of a discount that it was trading for because at the bottom there construction partners was trading for about 9 times its 2026 IBIDA projections which is well below the historical median for the business and actually was "

"I like to think of Construction Partners as kind of the Constellation Software of the roadway industry, and that's really what the company does."

"Roads' total addressable market is growing because there are more roads, people are driving more, vehicles are heavier, and ultimately this means that there is more maintenance that needs to happen."

"So, what the management is saying here is that their 2030 guidance is also just if Road continues to do exactly what they have done over the longer term and does not have another transformational large acquisition like they have done historically in the past."

"The industry that Construction Partners operates in is highly fragmented. There are thousands of companies just in their existing states and they are the main consolidator of this industry."

"However, the stock is now in about a 30% correction over just the past month or so, and I have used this correction as an opportunity to finally buy into the stock because now I think that it is truly undervalued, and it is my moment to finally get some shares."

"I think that Road is looking cheap based on a price to EBITDA basis versus the company's historical averages."

"And this company is Construction Partners with the ticker symbol ROAD."

"So, even on just a trailing 12 months EBITDA basis, it does look like the stock is trading for a pretty low multiple relative to how it has historically traded. And with this DCF, we get a 26.1% compounded annual growth rate over the next 5 years, a fair value of 193 bucks, and a future stock price of $310 by 2030."

"And I think that road could continue to grow strong for another 10-plus years simply by continuing to consolidate it, expand their market share in their existing states, and eventually continue expanding across the rest of the United States."

"Now the next stock that I want to talk about is Construction Partners Inc. with the ticker symbol road."