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Reflecting On Construction and Maintenance Services Stocks’ Q1 Earnings: Granite Construction (NYSE:GVA)


Max Juang /
2024/07/08 3:43 am EDT

As the Q1 earnings season wraps, let's dig into this quarter's best and worst performers in the construction and maintenance services industry, including Granite Construction (NYSE:GVA) and its peers.

Construction and maintenance services companies not only boast technical know-how in specialized areas but also may hold special licenses and permits. Those who work in more regulated areas can enjoy more predictable revenue streams - for example, fire escapes need to be inspected every five years–. More recently, services to address energy efficiency and labor availability are also creating incremental demand. But like the broader industrials sector, construction and maintenance services companies are at the whim of economic cycles as external factors like interest rates can greatly impact the new construction that drives incremental demand for these companies’ offerings.

The 7 construction and maintenance services stocks we track reported a solid Q1; on average, revenues beat analyst consensus estimates by 3.2%. Stocks--especially those trading at higher multiples--had a strong end of 2023, but 2024 has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and construction and maintenance services stocks have held roughly steady amidst all this, with share prices up 3.1% on average since the previous earnings results.

Granite Construction (NYSE:GVA)

Having played a role in the construction of the Hoover Dam, Granite Construction (NYSE:GVA) is a provider of infrastructure solutions for roads, bridges, and other projects.

Granite Construction reported revenues of $672.3 million, up 20% year on year, in line with analysts' expectations. It was a weak quarter for the company, with EPS falling below analysts' estimates.

“We continued to build on our momentum from 2023, and our teams are off to a strong start in 2024 driving revenue growth and significantly improved operating cash flow compared to the first quarter of 2023,” said Kyle Larkin, Granite President and Chief Executive Officer.

Granite Construction Total Revenue

The stock is up 12.1% since the results and currently trades at $61.59.

Read our full report on Granite Construction here, it's free.

Best Q1: Great Lakes Dredge & Dock (NASDAQ:GLDD)

Founded as Lydon & Drews dredging company, Great Lakes Dredge & Dock (NASDAQ:GLDD) provides dredging services, land reclamation, and coastal protection projects in the United States and internationally.

Great Lakes Dredge & Dock reported revenues of $198.7 million, up 25.7% year on year, outperforming analysts' expectations by 13.2%. It was an incredible quarter for the company, with revenue and EPS exceeding Wall Street's expectations.

Great Lakes Dredge & Dock Total Revenue

Great Lakes Dredge & Dock scored the biggest analyst estimates beat among its peers. The stock is up 15.3% since the results and currently trades at $8.13.

Is now the time to buy Great Lakes Dredge & Dock? Access our full analysis of the earnings results here, it's free.

APi (NYSE:APG)

Started in 1926 as an insulation contractor, APi (NYSE:APG) provides life safety solutions and specialty services for buildings and infrastructure.

APi reported revenues of $1.60 billion, down 0.8% year on year, falling short of analysts' expectations by 0.1%. It was a weaker quarter for the company, with a miss of analysts' organic revenue estimates.

APi had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is down 3.5% since the results and currently trades at $36.48.

Read our full analysis of APi's results here.

WillScot Mobile Mini (NASDAQ:WSC)

Originally focusing on mobile offices for construction sites, WillScot (NASDAQ:WSC) provides ready-to-use temporary spaces, largely for longer-term lease.

WillScot Mobile Mini reported revenues of $587.2 million, up 3.8% year on year, surpassing analysts' expectations by 1.1%. It was a slower quarter for the company, with underwhelming EBITDA guidance for the full year and a miss of analysts' earnings estimates.

WillScot Mobile Mini had the weakest full-year guidance update among its peers. The stock is down 2.4% since the results and currently trades at $36.71.

Read our full, actionable report on WillScot Mobile Mini here, it's free.

Comfort Systems (NYSE:FIX)

Having historically grown through organic means as well as acquisitions of numerous peers and competitors, Comfort Systems USA (NYSE:FIX) provides mechanical and electrical contracting services.

Comfort Systems reported revenues of $1.54 billion, up 30.8% year on year, surpassing analysts' expectations by 4.8%. It was an incredible quarter for the company, with an impressive beat of analysts' backlog sales estimates.

Comfort Systems achieved the fastest revenue growth among its peers. The stock is down 3.6% since the results and currently trades at $300.56.

Read our full, actionable report on Comfort Systems here, it's free.

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