MeritValue

Construction Partners, Inc.

ROADdata completeness 100%9 fiscal years on file
The thesis, from the filings

Construction Partners, Inc. earns about 3% on invested capital, but has diluted owners by 7% over 5 years — worth asking whether the growth reaches owners. The applicable estimate puts fair value near $9.17 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$910.7M1$1.3B2$1.56B3$1.82B3$2.81B3
Net income$20.2M4$21.4M5$49M6$68.9M6$101.8M6
Operating cash flow$48.5M7$16.5M8$157.2M9$209.1M9$291.3M9
Capital expenditure$56.3M10$68.9M11$97.8M12$87.9M12$137.9M12
Free cash flow (derived)−$7.83M7−$52.4M8$59.3M9$121.1M9$153.4M9
Total debt$433.7M13$752.5M14$375.7M15$1.03B16$3.24B16
Cash & equivalents$57.3M17$35.5M18$48.2M19$74.7M20$156.1M20
Diluted shares51.8M52.0M52.3M52.6M55.4M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$164.7
your share of equity
Profit it earned you last year
$18.38
Free cash flow it threw off
$27.7
Debt you’d be carrying
$584.83

10 shares is a claim on $164.7 of net worth that earned you $18.38 and generated $27.7 of cash last year, against $584.83 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
3% avg · 5y
FY21 3%FY22 1%FY23 4%FY24 5%FY25 3%

It earned an average 3% on invested capital over 5 years. Compare that to what it costs to fund the business.

seeing a moat in the numbers →
Management signal · capital allocation
+7% shares · 5y

Share count is up 7% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 647% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0
DCF · Growth Exit 10Y
not applicable
negative equity value — refusing to publish per-share figure
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth5.0%
  • fcfBase$121.1M
DCF · Growth Exit 5Y
not applicable
negative equity value — refusing to publish per-share figure
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth5.0%
  • fcfBase$121.1M
Earnings Power Value
$9.17
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$49M
  • growthAssumed0.0%
Graham Number
$26.11
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

Sources — the receipts
  1. 10-K · period ending 2021-09-30 · accession 0001718227-23-000081 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-09-30 · accession 0001718227-24-000102 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-09-30 · accession 0001628280-25-053871 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-09-30 · accession 0001718227-23-000081 (NetIncomeLoss)
  5. 10-K · period ending 2022-09-30 · accession 0001718227-24-000102 (NetIncomeLoss)
  6. 10-K · period ending 2023-09-30 · accession 0001628280-25-053871 (NetIncomeLoss)
  7. 10-K · period ending 2021-09-30 · accession 0001718227-23-000081 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-09-30 · accession 0001718227-24-000102 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-09-30 · accession 0001628280-25-053871 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-09-30 · accession 0001718227-23-000081 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-09-30 · accession 0001718227-24-000102 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-09-30 · accession 0001628280-25-053871 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-09-30 · accession 0001718227-22-000103 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-09-30 · accession 0001718227-23-000081 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-09-30 · accession 0001718227-24-000102 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-09-30 · accession 0001628280-25-053871 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-09-30 · accession 0001718227-22-000103 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-09-30 · accession 0001718227-23-000081 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-09-30 · accession 0001718227-24-000102 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-09-30 · accession 0001628280-25-053871 (CashAndCashEquivalentsAtCarryingValue)