Company Overview
Arcosa, Inc. operates within the Industrials sector specifically focusing on the Engineering & Construction industry, delivering infrastructure-related products and solutions across the construction, engineered structures, and transportation markets in the United States. The enterprise's operations are structured through three distinct segments: Construction Products, Engineered Structures, and Transporta, reflecting a diversified approach to delivering specialized infrastructure capabilities. This large-cap entity commands a market capitalization of $5.04B and generates annual revenue of $2.88B, supporting a workforce of 6390 employees. These valuation and revenue figures position the company as a significant player in the industrial landscape, indicating substantial scale and established market presence relative to peers in the engineering and construction space. The breadth of its employee base and multi-segment operational model suggests a robust organizational structure capable of managing complex projects across diverse infrastructure requirements.
Financial Health
The company reported a trailing twelve-month revenue of $2.88B with a corresponding net income of $208.00M and EBITDA of $533.70M, highlighting a significant gap between gross revenue and bottom-line earnings that reveals a substantial cost structure involving operational expenses, taxes, and interest. Operating with $76.59M in free cash flow, the company maintains a specific level of financial flexibility that is heavily influenced by its high debt obligations rather than organic cash generation efficiency. The gross margin stands at 22.4%, indicating the portion of revenue left after direct costs, while the operating margin of 6.5% and profit margin of 7.2% demonstrate the company's ability to cover overhead and deliver net profitability respectively. On the balance sheet, total cash of $214.60M is significantly lower than total debt of $1.58B, supported by a debt-to-equity ratio of 59.91, which characterizes a leveraged financial position rather than a conservative one. Despite the leverage, the current ratio of 2.20 indicates strong short-term liquidity, suggesting the firm can comfortably meet its short-term obligations with its current assets. Return on equity is measured at 8.2% and return on assets at 3.9%, metrics that reveal the efficiency of management in generating returns on shareholder equity and total assets, respectively.
Valuation Assessment
Valuation metrics for Arcosa, Inc. show a trailing P/E ratio of 24.26 compared to a forward P/E of 19.16, implying that the market expects earnings growth or a multiple contraction in the future. The price-to-book ratio is 1.91, which indicates that the company trades at a premium of roughly 91% above its book value, reflecting investor confidence in its tangible asset base and future earnings potential. Alternative valuation measures include a price-to-sales ratio of 1.75 and an EV/EBITDA of 12.02, suggesting the company is priced at 1.75 times its sales and 12.02 times its enterprise value-adjusted earnings. The stock has traded between a 52-week high of $131.00 and a 52-week low of $68.11, and without a specific current price provided in the facts, the relative position can only be described within this established range of volatility. The beta of 0.98 indicates that the stock's price volatility is nearly identical to the broader market, moving in tandem with general market sentiment rather than exhibiting extreme sensitivity to market swings.
Growth & Income
Revenue growth for the trailing twelve months stands at 7.6%, while earnings growth is listed as N/A, preventing a direct comparison of earnings velocity against revenue expansion in this specific reporting period. Regarding income distribution, the company offers a dividend yield of 0.2% with a payout ratio of 4.7%, which is a very low level relative to earnings, indicating high sustainability of the dividend even if earnings were to fluctuate. The minimal payout ratio suggests that the vast majority of earnings are retained within the company to fund operations, debt reduction, or capital investments rather than being distributed to shareholders. Overall, the growth and income profile is characterized by solid revenue expansion and a highly conservative dividend policy that prioritizes balance sheet strength over immediate income distribution to investors.