Arcosa, Inc. (NYSE: ACA) Stock Purchase and Financial Performance Review

Arcosa, Inc. (NYSE: ACA) is a prominent player in the infrastructure sector, providing a range of products and solutions. The company recently made headlines when BEST RHYS J, a director, purchased 1,500 shares of ACA's common stock at $79.84 each on March 5, 2025. This acquisition increased his total holdings to 58,195 shares, reflecting confidence in the company's future prospects.

Arcosa's recent financial performance has been mixed. In its fourth quarter of 2024, the company reported earnings of $0.46 per share, which fell short of the Zacks Consensus Estimate of $0.79 per share. This represents a significant earnings surprise of -41.77%. However, in the previous quarter, Arcosa exceeded expectations with earnings of $0.91 per share, surpassing the anticipated $0.78, resulting in a positive surprise of 16.67%.

Despite the earnings miss, Arcosa's revenue for the quarter ending December 2024 was $666.2 million, an increase from $582.2 million a year ago. However, this figure still missed the consensus estimate by 4.03%. Over the past four quarters, Arcosa has exceeded consensus revenue estimates twice, indicating some volatility in its financial performance.

A notable development for Arcosa was its acquisition of Stavola Holding Corporation's construction materials business for $1.2 billion on October 1, 2024. This strategic move is expected to bolster Arcosa's position in the building products industry, particularly in aggregates, which is Stavola's area of expertise.

Arcosa's financial metrics provide further insight into its market position. The company has a price-to-earnings (P/E) ratio of approximately 42.8, indicating investor willingness to pay a premium for its earnings. Its price-to-sales ratio is about 1.56, and the enterprise value to sales ratio is 2.15, suggesting a slightly higher total value compared to sales. With a debt-to-equity ratio of 0.70 and a current ratio of 1.85, Arcosa maintains a moderate level of debt and a strong ability to cover short-term liabilities.

DA Davidson analysts increased their price target for Arcosa (NYSE:ACA) to $105 from $95, maintaining their Buy rating on the stock. The new target is based on a 13x and 12x multiple of projected EBITDA for 2024 and 2025, respectively.

The updated estimates take into account partial contributions from the recent Ameron acquisition and anticipate a second-half increase in wind deliveries that should persist into 2025 and beyond. Additionally, improving barge visibility and backlog, alongside the aggregate segment's strong margins, provide opportunities for growth as infrastructure and construction activities pick up.

The analysts believe that the company's growth potential, leverage to infrastructure investment, and steady cash flow position it favorably, which supports the continued Buy recommendation.

DA Davidson analysts increased their price target for Arcosa (NYSE:ACA) to $105 from $95, maintaining their Buy rating on the stock. The new target is based on a 13x and 12x multiple of projected EBITDA for 2024 and 2025, respectively.

The updated estimates take into account partial contributions from the recent Ameron acquisition and anticipate a second-half increase in wind deliveries that should persist into 2025 and beyond. Additionally, improving barge visibility and backlog, alongside the aggregate segment's strong margins, provide opportunities for growth as infrastructure and construction activities pick up.

The analysts believe that the company's growth potential, leverage to infrastructure investment, and steady cash flow position it favorably, which supports the continued Buy recommendation.

Analysts at Berenberg Bank provided their views on Arcosa, Inc. (NYSE:ACA) following the company’s recently announced Q4 results (Feb 23). The earnings came in better than expected but the company’s 2022 adjusted EBITDA guidance was slightly below the Street expectations. While the company has suffered from a series of negative earnings revisions throughout much of 2021, the analysts note the outlook provided seems to indicate a trough in the company’s more cyclical business lines.

Consequently, the analysts expect the company will begin benefitting from some positive earnings momentum, especially once the recovery in barge/wind towers begins in earnest. The analysts lowered their price target on the company’s shares to $64 from $66, mainly on the back of their lower estimates, but maintain their Buy rating as they believe the company remains a deeply undervalued story.

Analysts at Berenberg Bank provided their views on Arcosa, Inc. (NYSE:ACA) following the company’s recently announced Q4 results (Feb 23). The earnings came in better than expected but the company’s 2022 adjusted EBITDA guidance was slightly below the Street expectations. While the company has suffered from a series of negative earnings revisions throughout much of 2021, the analysts note the outlook provided seems to indicate a trough in the company’s more cyclical business lines.

Consequently, the analysts expect the company will begin benefitting from some positive earnings momentum, especially once the recovery in barge/wind towers begins in earnest. The analysts lowered their price target on the company’s shares to $64 from $66, mainly on the back of their lower estimates, but maintain their Buy rating as they believe the company remains a deeply undervalued story.