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what it is
Granite builds highways, bridges, and transit projects, then sells the rock and asphalt those jobs consume.
how it gets paid
Last year Granite Constr made $4.4B in revenue. Highways and roads was the main engine at $1.90B, or 43% of sales.
why it's growing
Revenue grew 10.4% last year. Revenues climbed 10% vs. prior year, to $4.42 billion, led by continued higher sales volumes and prices in both aggregates and asphalt.
what just happened
Granite's revenue of $3.3B and EPS of $2.83 as growth finally hit the income statement.
At a glance
B+ balance sheet — decent shape, but not bulletproof
15/100 earnings predictability — expect surprises
22.2x trailing p/e — priced about right
0.5% dividend yield — cash in your pocket every quarter
15.5% return on capital — nothing to write home about
xvary composite: 62/100 — average
What they do
Granite builds highways, bridges, and transit projects, then sells the rock and asphalt those jobs consume.
Granite wins where size, local materials, and public-agency relationships matter. You do not just bid a bridge and show up with a shovel. The company did $4.42 billion of 2025 revenue and carries a B+ balance sheet, which helps it take on large, messy projects while smaller rivals tap out.
How they make money
$4.4B
annual revenue · their business grew +10.4% last year
Highways and roads
$1.90B
Bridges and other structures
$0.75B
Mass transit facilities
$0.55B
Other civil and legacy projects
$0.56B
Construction materials
$0.66B
The products that matter
builds public infrastructure
Heavy Civil Construction
$3.7B · 85% of revenue
it drives about 85% of revenue, and the $7.0B backlog gives you visibility that stretches well beyond one quarter.
$7.0B backlog
produces aggregates and asphalt
Construction Materials
$660M · 15% of revenue
this is the smaller $660M business, but management called out higher sales volumes and prices in aggregates and asphalt as part of the 2025 growth story.
margin support
Key numbers
13.5%
operating margin
Margin → what is left after running the business → so what: Granite is proving it can turn more of each sales dollar into profit.
15.5%
return on capital
Return on capital → profit earned on the money tied up in the business → so what: this is solid for a contractor.
$963M
long-term debt
Debt → money owed over time → so what: manageable at 14% of capital, but still large enough to matter if projects stumble.
22.2x
trailing p/e
P/E → price divided by past earnings → so what: you are not buying this like a busted cyclical stock.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 55 / 100
- long-term debt $963M (14% of capital)
- net profit margin 6.2% — keeps 6 cents of every dollar in revenue
- return on equity 22% — $0.22 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in GVA 3 years ago → it's now worth $32,040.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
Granite's revenue of $3.3B and EPS of $2.83 as growth finally hit the income statement.
Annual revenue rose 10.4% to $4.4B. Gross margin was 16.7%, and management said higher volumes and pricing helped adjusted EBITDA margin rise to 11.9% from 10.0%.
$1.1B
revenue
$2.83
eps
16.7%
gross margin
the number that mattered
The important number was 11.9% adjusted EBITDA margin versus 10.0% a year earlier. Margin improvement matters more than one loud quarter.
-
granite construction posted robust top-line growth in 2025.
-
revenues climbed 10% vs. prior year, to $4.42 billion, led by continued higher sales volumes and prices in both aggregates and asphalt.
-
importantly, in the clearest signal of improving operational leverage, adjusted ebitda increased to 11.9%, up from 10% in 2024.
-
management’s 2026 guidance sets a modest but achievable target.
-
the company is guiding for revenue in the range of $4.9 billion to $5.1 billion and an adjusted ebitda margin of 12% to 13%.at the moment, the surface transportation reauthorization amounts currently being discussed in congress are higher than those in the infrastructure investment and jobs act (iija). a larger, multi-year funding bill could extend the construction cycle far beyond the current iija’s expiration in september 2026.
source: company earnings report, 2026
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What could go wrong
the top risk is a funding gap after federal infrastructure support rolls past september 2026 without a clean replacement.
med
Federal funding rollover
Granite's $7.0B backlog looks different if washington extends the cycle and if it doesn't. Public works spending is the story here.
If the next transportation bill slips or shrinks, project timing gets pushed out and backlog quality matters more than backlog size.
med
Backlog conversion risk
A record backlog is not revenue until crews execute, costs stay under control, and the work turns into cash. Granite is guiding for 12–13% adjusted EBITDA margin in 2026 after posting 11.9% in 2025.
If margin slips instead of expanding, the stock stops looking like a compounding story and starts looking like a cyclical contractor again.
med
Input-cost volatility
Management already called out pricing and volumes in aggregates and asphalt as part of the 2025 improvement. That cuts both ways when diesel, steel, or materials costs move against you.
A cost spike would pressure the 6.2% net margin fast. Thin-margin businesses do not get many bad quarters for free.
$7.0B of backlog is the upside. The catch is that it sits on a 6.2% net margin base and depends on both public funding and clean execution.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
2026 adjusted EBITDA margin
Guidance is 12–13% after 11.9% in 2025. If that line stalls, the thesis weakens fast.
calendar
the next earnings report
You want two things in the same release: backlog staying healthy and margin moving toward the 12–13% target.
trend
materials pricing and volume
Higher aggregates and asphalt volumes helped 2025. If that cools, the smaller 15% materials segment stops doing extra margin work.
risk
federal funding after september 2026
Congress matters here more than usual. A larger multi-year bill would support the backlog story. A gap would not.
Analyst rankings
earnings predictability
15 / 100
low predictability. in human-speak, analysts do not trust this business to print smooth quarters.
risk rank
3
middle-of-the-pack risk. Safer than the market's weakest names, but no one is calling this a bunker stock.
price stability
55 / 100
the stock has been steadier than the wild stuff, but you still own a contractor tied to project cycles.
source: institutional data
Institutional activity
117 buyers vs. 140 sellers in 4q2025. total institutional holdings: 51.1M shares.
source: institutional data
Price targets
3-5 year target range
$106
$198
$135
current price
$152
target midpoint · +13% from current · 3-5yr high: $220 (+65% · 13% ann'l return)
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