Knife River Q3 revenue misses estimates on contracting services headwins
Overview
U.S. construction materials supplier's Q3 revenue grew 6% yr/yr but missed analyst expectations
Q3 adjusted EBITDA was flat yr/yr and missed analyst expectations
Company cites aggregate demand and margin gains, but ongoing headwinds in contracting services
Outlook
Knife River sees 2026 revenue between $3.38 bln and $3.43 bln
Company expects 2026 adjusted EBITDA of $475 mln to $505 mln
Aggregates, ready-mix and asphalt volumes seen up high-single to low-double digits in 2026
Result Drivers
AGGREGATE VOLUME - Co said internal pull-through and higher third-party sales drove a 10% increase in aggregate volumes
PRICE INCREASES & COST REDUCTIONS - Co said mid-single digit aggregate price increases and lower per-unit production costs improved aggregate gross margin
CONTRACTING SERVICES HEADWINDS - Co said market dynamics, project delays and higher fuel costs weighed on contracting services
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Miss | $1.28 bln | $1.30 bln (8 Analysts) |
Q3 EPS | $2.43 | ||
Q3 Net Income | $137.90 mln | ||
Q3 Adjusted EBITDA | Miss | $271.70 mln | $280.09 mln (9 Analysts) |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 3 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the construction materials peer group is "buy"
Wall Street's median 12-month price target for Knife River Corp is $65.00, about 12.6% above its November 2 closing price of $57.73
The stock recently traded at 21 times the next 12-month earnings vs. a P/E of 20 three months ago
Reuters Recommended Reads
Nov 2 - Boise Cascade Q3 sales rise, beat estimates
Nov 3 - Germany's Schaeffler 9-month sales flat on China hit, EBIT margin rises
Nov 3 - Norma Group Q3 sales rise, profitability improves on new orders
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)