Yahoo Finance Granite (GVA) Buys Lehman-Roberts & Memphis Stone & Gravel
Granite Construction Incorporated GVA has successfully acquired Lehman-Roberts Company (“LRC”) and Memphis Stone & Gravel Company (“MSG”), bolstering its presence in the Memphis metropolitan market. LRC, operating seven asphalt plants, and MSG, with three sand and gravel mines, bring a wealth of proven and probable reserves to Granite's portfolio.
Led by Pat Nelson, the senior leadership team of the acquired companies will continue to drive success within the Granite group.
This strategic move aligns with Granite's focus on developing home markets through partnerships with successful, scalable entities. The acquisition, financed through a $150 million term loan and Granite's existing resources, has prompted an upward revision of the 2024 revenue target in the range of $3.8 billion-$4.0 billion.
Granite anticipates the acquisition to be accretive to EBITDA, reinforcing its commitment to a 2024 adjusted EBITDA margin range of 9%-11%. The infusion of Lehman-Roberts and Memphis Stone & Gravel sets the stage for Granite to capitalize on the burgeoning demand for asphalt and aggregates in the Southeast.
As the construction industry continues to evolve, Granite's strategic expansion positions it as a formidable player in the market. The company's foresight in growing through targeted acquisitions underscores its commitment to delivering value to shareholders and stakeholders alike.
The company has been bolstering its materials business through both greenfield and bolt-on investments, and improved segment margins.
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Shares of GVA have rallied 34.2% year to date, outperforming the Zacks Building Products - Heavy Construction industry’s 17.4% rise. The consistent award wins have been driving GVA’s performance. The company is focused on growing a high-quality Committed and Awarded Projects or CAP portfolio on the back of a positive public funding environment and resilient private market.
Zacks Rank
Granite currently sports a Zacks Rank #1 (Strong Buy).
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