Granite Construction Boosts Footprint In Memphis Metropolitan Area, Raises FY24 Sales Outlook
Portfolio Pulse from Lekha Gupta
Granite Construction Inc (NYSE:GVA) has acquired Lehman-Roberts Company and Memphis Stone & Gravel Company, enhancing its presence in the Memphis metropolitan area. The acquisition includes strategic assets like asphalt plants and sand and gravel mines, along with significant material reserves. Following the acquisition, GVA raised its FY24 sales outlook from $3.6-$3.9 billion to $3.8-$4.0 billion, while maintaining its adjusted EBITDA margin outlook. The purchase was financed through a new term loan and existing funds. GVA's stock saw a slight decline of 0.72% to $47.10.
December 05, 2023 | 6:09 pm
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Granite Construction's acquisition of LRC and MSG expands its market presence and resources, leading to an increased FY24 sales outlook. The stock experienced a minor drop after the announcement.
The acquisition is likely to be viewed positively as it expands GVA's footprint and resources, which is reflected in the raised sales outlook. The slight stock price drop could be a short-term reaction to the news or market conditions, but the strategic growth potential may lead to a positive impact on the stock price in the short term.
CONFIDENCE 90
IMPORTANCE 85
RELEVANCE 100