How does knife river make money?

knife river generates $3.1B in annual revenue (annual revenue · their business grew +8.5% last year).

What is KNF's XVARY composite score?

knife river (KNF) has an XVARY composite score of 50/100, rated below average. This combines growth, value, risk, and momentum factors.

KNF — knife river stock analysis

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what it is

Knife River sells crushed stone, asphalt, concrete, and contracting work that keep public and private construction projects moving.

how it gets paid

Last year Knife River made $3.1B in revenue. aggregates was the main engine at $1.02B, or 33% of sales.

why it's growing
Revenue grew 8.5% last year. Fourth-quarter revenue and share earnings rose 15% and 37%.

what just happened

Knife River posted a quarterly EPS beat, with $0.56 versus a $0.35 consensus estimate.

At a glance

B balance sheet — gets the job done, barely

32.2x trailing p/e — you're paying up for this one

11.0% return on capital — nothing to write home about

$6.20 fy2029 eps est

$4B fy2029 rev est

xvary composite: 50/100 — below average

What they do

Knife River sells crushed stone, asphalt, concrete, and contracting work that keep public and private construction projects moving.

This business wins because it owns the ugly stuff nobody wants to haul far. Knife River runs 188 aggregate sites, 110 ready-mix plants, and 50 asphalt plants across 14 states, so your local road job usually buys nearby, not cheaper-from-far-away. Operating margin was 16.5% and return on capital was 11.0%, which means scale and location are doing real work.

materials mid-cap construction infrastructure aggregates

How they make money

$3.1B annual revenue · their business grew +8.5% last year

aggregates

$1.02B

ready-mix concrete

$0.74B

asphalt

$0.56B

contracting services

$0.62B

other materials and services

$0.16B

The products that matter

supplies building materials

construction materials

part of $3.1B revenue

this sits inside the full $3.1B business and matters because materials volume and pricing usually set the tone for the rest of the model.

core revenue base

performs project work

contracting services

supports 16.5% margin

this is the execution arm of the company. with a 16.5% operating margin and 9.5% net margin, project discipline matters more than a flashy growth story.

margin watch

integrated local model

materials + contracting

11.0% return on capital

the investment case is that an integrated $3.1B platform can keep earning at least around its current 11.0% return on capital while revenue grows toward the $4B analyst estimate.

the bet

Key numbers

16.5%

operating margin

Operating margin → the share of sales left after running the business → so what: this is strong for a construction materials company.

$1.2B

long-term debt

Long-term debt → money owed beyond one year → so what: the balance sheet is workable, but cycles get mean when debt is already there.

32.2x

trailing p/e

P/E → price compared with last year's earnings → so what: you are paying a premium before the next downturn has even RSVP'd.

$114

18-month target

Analyst target → where researchers think the stock can trade in 18 months → so what: 28% upside exists, but the 32.2x P/E says execution has to stay clean.

Financial health

B

strength

balance sheet grade B — adequate — nothing special
risk rank 3 — safer than 50% of stocks
price stability 40 / 100
long-term debt $1.2B (19% of capital)
net profit margin 9.5% — keeps 10 cents of every dollar in revenue
return on equity 16% — $0.16 profit for every $1 investors have put in

B — functional but not a standout on the balance sheet.

Total return vs. market

Return history isn't available for KNF right now.

same standard. no invented return math.

source: institutional data · return history unavailable

What just happened

beat estimates

Knife River posted a quarterly EPS beat, with $0.56 versus a $0.35 consensus estimate.

Fourth-quarter revenue and share earnings rose 15% and 37%, helped by mild weather in western markets and ongoing cost-efficiency work. EDGAR shows the latest quarter at $2.4B of revenue and $2.20 EPS, but the company-reported quarter in the supplied earnings set was $0.56 diluted EPS.

$775M

revenue

$0.56

eps

18.1%

gross margin

the number that mattered

$0.56 mattered because it beat the $0.35 consensus by 60%, which tells you pricing and cost control outran expectations.

knife river posted better-than-expected fourth-quarter results.
revenues and share earnings rose 15% and 37%, respectively.
mild weather in the west and mountain segments enabled the company to do more contracting work.

also, the fifth acquisition of the year (texcrete) permitted knife to boost its top line along with organic volume and price increases.
the bottom line benefitted from greater sales, as well as ongoing costefficiency measures, specifically the implementation of ai software upgrades.
these outlegged higher raw material costs.

source: company earnings report, 2026

What could go wrong

the top threat here is paying a premium multiple for a cyclical construction materials business.

∘

med

valuation compression

32.2x trailing earnings is rich for a business generating an 11.0% return on capital. if growth cools or margins slip, the multiple can do the damage even if the company stays profitable.

∘

med

construction cycle exposure

knife river sells materials and contracting services. that means demand depends on construction activity staying healthy. this snapshot does not show backlog or end-market mix, which makes cycle risk harder to handicap.

∘

med

balance sheet drag

$1.2B of long-term debt equals 19% of capital. that is manageable, but it still matters in a business with 18.1% gross margin and 9.5% net margin.

∘

med

institutional distribution

institutions were net sellers for three consecutive quarters, including 126 buyers versus 155 sellers in 4q2025. if big holders keep trimming, valuation support gets thinner.

If volume slips and the multiple compresses, you get hit twice: lower earnings and a lower price tag on those earnings.

source: institutional data · regulatory filings · risk analysis

Pay attention to

valuation

watch whether earnings catch up to the multiple

32.2x trailing p/e is the first thing on the page for a reason. if the stock stays near $89, you need profits to keep doing real work.

growth

revenue has to keep climbing, not just hold flat

the last reported revenue growth was 8.5%. if that slows materially while the valuation stays premium, the story changes fast.

ownership

three quarters of net institutional selling is enough to notice

52.2M shares are institutionally held. when large holders keep leaning the same way, you should care even if the stock price has not broken yet.

next update

the next earnings print needs to defend margin quality

16.5% operating margin and 9.5% net margin are good numbers for this kind of business. they also set the bar for what counts as a clean quarter from here.

Analyst rankings

long-term target midpoint

$114

that is about 28% above the current price. in human-speak, analysts still see upside from here.

3–5 year target range

$105–$155

the spread matters. even the low end is above the current price, but the difference between $105 and $155 tells you conviction is not surgical.

xvary composite

50 / 100

our composite score lands below average because the valuation asks for more than the current business quality alone gives you.

source: institutional data

Institutional activity

institutions have been net selling for 3 consecutive quarters — 126 buyers vs. 155 sellers in 4q2025. total institutional holdings: 52.2M shares. net selling for 3 quarters.

source: institutional data · 2q2025-4q2025

source: institutional data

Price targets

3-5 year target range

$68 $159

$89 current price

$114 target midpoint · +28% from current · 3-5yr high: $155 (+75% · 15% ann'l return)

source: institutional data · analyst targets

The deep dive

KNF

xvary deep dive

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the full analysis is in the works.

what you'll get

dcf valuation model

bull / base / bear scenarios

competitive moat breakdown

quarterly earnings tracker

operating model projections

risk matrix with kill criteria

original price target + conviction

updated with every earnings

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