Johnson Fistel has Commenced an Investigation on Behalf of Construction Partners, Inc. (ROAD) Shareholders
Johnson Fistel, LLP is investigating Construction Partners, Inc. (NASDAQ: ROAD) for potential violations of federal securities laws.
What if I purchased Construction Partners securities? If you purchased securities and suffered losses on your investment, join our investigation now:
Or for more information, contact Jim Baker at jimb@johnsonfistel.com or (619) 814-4471. There is no cost or obligation to you.
What is Johnson Fistel Investigating? On January 23, 2025, Spruce Point Capital Management has issued a report recommending a strong sell on Construction Partners Inc, a company specializing in infrastructure and road construction.
The report indicates that Construction Partners is facing numerous pressures that could impact its financial stability and stock value. According to the investment firm’s analysis, Construction Partners is struggling with organic revenue growth and a weakening backlog quality. Additionally, there are concerns about a decline in the return on capital and issues with free cash flow conversion.
Spruce Point has presented evidence, obtained through Freedom of Information Act requests, suggesting that Construction Partners’ largest customer, the Florida Department of Transportation, has reduced contract awards by approximately 22% in 2024. This reduction could be a significant setback for the company, given the importance of this customer to its operations.
The report also questions the success of Construction Partners’ recent expansion into Texas with the acquisition of Lone Star Paving. Contrary to the company’s positive portrayal of the acquisition, Spruce Point’s findings suggest that the new addition may not be as beneficial as expected.
Furthermore, Spruce Point has raised concerns about the valuation of Construction Partners, citing what it believes to be enterprise value miscalculations, weak aggregate holdings, and poor transparency. The investment firm also questions the sustainability of the company’s profit margins.
Based on its analysis, Spruce Point has suggested that Construction Partners’ share price could face a potential long-term downside risk of 35% to 50%. This opinion is based on the firm’s findings and represents a significant potential decrease in stock value.
What if I have relevant nonpublic information? Individuals with nonpublic information regarding the company should consider whether to assist our investigation or take advantage of the SEC Whistleblower program. Under the SEC program, whistleblowers who provide original information may, under certain circumstances, receive rewards totaling up to thirty percent of any successful recovery made by the SEC. For more information, contact Jim Baker at (619) 814-4471 or jimb@johnsonfistel.com.
About Johnson Fistel, LLP:
Johnson Fistel, LLP is a nationally recognized shareholder rights law firm with offices in California, New York, Georgia, and Colorado. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits. For more information about the firm and its attorneys, please visit http://www.johnsonfistel.com.