Headland Capital Fully Exits Knife River Position
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Source: Fool
- Exit Transaction: On January 28, Headland Capital disclosed in an SEC filing that it sold all 63,636 shares of Knife River, with an estimated transaction value of approximately $4.89 million, indicating a cautious outlook on the company's future prospects.
- Poor Market Performance: As of January 27, Knife River's shares were priced at $68.59, down 31.4% over the past year and significantly underperforming the S&P 500 by 47.5 percentage points, reflecting market pessimism regarding its performance.
- Financial Condition: Despite Knife River's recent record third-quarter revenue of $1.2 billion, up 9% year-over-year, the market's reaction remains tepid due to margin pressures in certain regions, highlighting the challenges the company faces.
- Future Growth Risks: Knife River's growth now hinges on flawless execution, margin recovery, and disciplined balance sheet management, and in the current market environment, investor patience is being tested, potentially leading to a reassessment of risk tolerance among investors.
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Analyst Views on KNF
Wall Street analysts forecast KNF stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for KNF is 88.00 USD with a low forecast of 75.00 USD and a high forecast of 106.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
4 Buy
1 Hold
0 Sell
Strong Buy
Current: 68.940
Low
75.00
Averages
88.00
High
106.00
Current: 68.940
Low
75.00
Averages
88.00
High
106.00
About KNF
Knife River Corporation is an aggregates-based construction materials and contracting services provider. Its segments include West, Mountain, Central and Energy Services. Each geographic segment offers a vertically integrated suite of products and services, including aggregates, ready-mix concrete, asphalt, and contracting services, while the Energy Services segment, which has locations throughout the Company’s geographic footprint, produces and supplies liquid asphalt and related services, primarily for use in asphalt road construction, and is a supplier to some of the other segments. Through its network of 182 active aggregate sites, 106 ready-mix plants and 51 asphalt plants, and 9 liquid asphalt terminals. It supplies construction materials and contracting services to customers in 14 states. Its construction materials are sold to public and private-sector customers, including federal, state, and municipal governments, as well as industrial, commercial, and residential developers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Paradice Investment Management Acquires Knife River Shares
- New Investment Position: Paradice Investment Management acquired 312,743 shares of Knife River in Q4 for $22 million, reflecting a strategic shift towards infrastructure assets with visible demand and pricing power.
- Significant Stake: This new holding represents 4.28% of Paradice's 13F reportable assets, indicating confidence in Knife River's growth potential, particularly driven by public infrastructure projects.
- Performance Growth: Knife River reported a 9% year-over-year revenue increase to $1.2 billion and an 11% rise in adjusted EBITDA to $272.8 million, showcasing the effectiveness of its acquisition strategy and pricing discipline.
- Strong Backlog: The company's backlog reached a record $995 million, up 32% year-over-year, with 87% tied to public works, and most expected to convert to revenue within 12 months, highlighting robust demand in the infrastructure sector.
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Headland Capital Fully Exits Knife River Position
- Exit Transaction: On January 28, Headland Capital disclosed in an SEC filing that it sold all 63,636 shares of Knife River, with an estimated transaction value of approximately $4.89 million, indicating a cautious outlook on the company's future prospects.
- Poor Market Performance: As of January 27, Knife River's shares were priced at $68.59, down 31.4% over the past year and significantly underperforming the S&P 500 by 47.5 percentage points, reflecting market pessimism regarding its performance.
- Financial Condition: Despite Knife River's recent record third-quarter revenue of $1.2 billion, up 9% year-over-year, the market's reaction remains tepid due to margin pressures in certain regions, highlighting the challenges the company faces.
- Future Growth Risks: Knife River's growth now hinges on flawless execution, margin recovery, and disciplined balance sheet management, and in the current market environment, investor patience is being tested, potentially leading to a reassessment of risk tolerance among investors.
Continue Reading