GVA - Granite Construction stock jumps ~18% on record quarterly projects of $5.6B

2023-10-31 14:44:32 ET

Shares of Granite Construction ( NYSE: GVA ) on Tuesday soared as much as 18.1% , after the company saw record projects in its Q3.

GVA stock was last up 17.7% to $40.39 in late afternoon trade.

The Watsonville, Calif.-based firm reported Q3 adjusted earnings per share of $1.69, which beat estimates by 29 cents. Revenue rose 11% Y/Y to $1.11B, beating expectations by $30M.

GVA's committed and awarded projects (CAP) metric rose $147M Q/Q and $1.5B Y/Y to a record $5.6B. Its construction segment saw revenue growth of 11.6%, overcoming a weather-related slow start to the year. Meanwhile its materials unit saw sales increase by 5.9%, driven by higher asphalt and aggregate sales prices.

Granite's ( GVA ) quarterly results, like many of its peers in the construction industry, has been helped by increased spending on transportation and infrastructure in the U.S., sparked by the $1.2T Infrastructure Investment and Jobs Act (IIJA) signed into law in November 2021.

GVA top boss Kyle Larkin on the earnings conference call said that as the IIJA funds have come in over the last two years, the company has seen its margins improve by 1.5% to even 2%.

"Even though the third quarter was our busiest quarter, we were still able to continue to build CAP as we have done in each quarter over the last year," Larkin said.

"I believe we will continue to build CAP over the next year as we are still in the early stages of projects going out for bid funded by the IIJA," he added.

Turning to Granite's ( GVA ) guidance, the company kept its full year 2023 revenue forecast unchanged at $3.35B to $3.45B. The consensus revenue estimate is $3.38B.

More on Granite Construction

• Granite Construction Incorporated 2023 Q3 - Results - Earnings Call Presentation
• Granite Construction: Cheap Multiples, Mid And Long-Term Economics Not Supportive
• Seeking Alpha's Quant Rating on Granite Construction
• Granite awarded $45M contract by UDOT for SR-108 widening and improvements
• Granite secures contract worth $12.5M to restore access through Sequoia National Forest

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