Arcosa (NYSE:ACA) Shares Gap Up – Still a Buy?

Arcosa, Inc. (NYSE:ACA)’s share price gapped up before the market opened on Monday . The stock had previously closed at $135.84, but opened at $145.00. Arcosa shares last traded at $145.7530, with a volume of 162,839 shares changing hands.

Arcosa News Summary

Here are the key news stories impacting Arcosa this week:

• Positive Sentiment: CRH agreed to buy Arcosa, Inc. (ACA) for $150 per share in cash, giving shareholders a sizable premium and likely setting a near-term floor under the stock. CRH to Acquire Arcosa; Leading U.S. Provider of Aggregates and Critical Infrastructure Products for $8.5B
• Positive Sentiment: Market coverage highlighted Arcosa’s shares jumping on the takeover news, reflecting investor enthusiasm for the premium buyout price. Arcosa Stock Rises on $8.5 Billion Acquisition by CRH
• Positive Sentiment: The deal could benefit CRH by expanding its aggregates footprint and infrastructure exposure, which supports the strategic rationale for completing the transaction. Is CRH’s $8.5 Billion Arcosa Acquisition a Game Changer?
• Neutral Sentiment: Several law firms announced investigations into whether Arcosa’s board secured a fair price for shareholders, which could create legal headlines but does not change the announced deal terms yet.
• Neutral Sentiment: One commentary noted the stock looks overvalued after the rally, suggesting upside may be capped near the deal price if no higher bid emerges.

Analysts Set New Price Targets

Several equities research analysts have recently commented on ACA shares. DA Davidson raised their target price on shares of Arcosa from $120.00 to $125.00 and gave the stock a “buy” rating in a research report on Monday, March 2nd. Barclays boosted their price target on shares of Arcosa from $115.00 to $140.00 and gave the company an “overweight” rating in a research report on Monday, May 4th. Citigroup lowered shares of Arcosa to a “hold” rating in a report on Tuesday. Texas Capital raised Arcosa to a “strong-buy” rating in a research report on Friday, March 27th. Finally, Wall Street Zen upgraded Arcosa from a “sell” rating to a “hold” rating in a report on Saturday, May 30th. One investment analyst has rated the stock with a Strong Buy rating, three have given a Buy rating, two have given a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat.com, Arcosa currently has a consensus rating of “Moderate Buy” and a consensus target price of $138.33.

Arcosa Trading Up 0.1%

The stock has a market cap of $7.12 billion, a P/E ratio of 32.01, a PEG ratio of 2.13 and a beta of 1.06. The company has a current ratio of 2.32, a quick ratio of 1.60 and a debt-to-equity ratio of 0.57. The stock’s fifty day moving average price is $124.49 and its 200 day moving average price is $116.70.

Arcosa (NYSE:ACA) last released its earnings results on Thursday, April 30th. The company reported $0.51 earnings per share for the quarter, topping analysts’ consensus estimates of $0.13 by $0.38. Arcosa had a net margin of 7.88% and a return on equity of 8.52%. The firm had revenue of $571.70 million for the quarter, compared to the consensus estimate of $642.40 million. During the same period in the prior year, the firm earned $0.49 EPS. The company’s revenue was up 5.0% compared to the same quarter last year. Equities research analysts expect that Arcosa, Inc. will post 4.25 earnings per share for the current year.

Arcosa Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Friday, July 31st. Shareholders of record on Wednesday, July 15th will be paid a dividend of $0.05 per share. The ex-dividend date of this dividend is Wednesday, July 15th. This represents a $0.20 dividend on an annualized basis and a dividend yield of 0.1%. Arcosa’s dividend payout ratio (DPR) is currently 4.42%.

Institutional Trading of Arcosa

Hedge funds have recently made changes to their positions in the stock. State of Wyoming bought a new position in Arcosa during the 1st quarter valued at approximately $30,000. GHP Investment Advisors Inc. bought a new stake in Arcosa in the first quarter worth $32,000. Farther Finance Advisors LLC grew its stake in shares of Arcosa by 73.4% in the fourth quarter. Farther Finance Advisors LLC now owns 307 shares of the company’s stock worth $33,000 after acquiring an additional 130 shares during the last quarter. Quarry LP grew its stake in shares of Arcosa by 160.0% in the third quarter. Quarry LP now owns 403 shares of the company’s stock worth $38,000 after acquiring an additional 248 shares during the last quarter. Finally, Allworth Financial LP grew its stake in shares of Arcosa by 392.5% in the fourth quarter. Allworth Financial LP now owns 394 shares of the company’s stock worth $42,000 after acquiring an additional 314 shares during the last quarter. 90.66% of the stock is owned by institutional investors.

About Arcosa

Arcosa, Inc (NYSE: ACA) is a Dallas‐based industrial company that was formed through the spin‐off of Trinity Industries’ construction products business in 2018. Since its inception, Arcosa has focused on the manufacture and sale of critical infrastructure components, serving a diverse set of end markets including transportation, construction and energy.

The company’s Construction Products segment produces a broad range of highway safety products, such as guardrail systems, sign supports and crash cushions, as well as aggregates and ready‐mix concrete.