Knife River (NYSE:KNF) Announces Quarterly Earnings Results, Misses Estimates By $0.36 EPS

Knife River (NYSE:KNF) released its quarterly earnings results on Tuesday. The company reported $0.77 earnings per share for the quarter, missing analysts’ consensus estimates of $1.13 by ($0.36), Zacks reports. Knife River had a return on equity of 9.35% and a net margin of 4.58%.The company had revenue of $938.60 million during the quarter, compared to analysts’ expectations of $931.39 million. During the same quarter in the prior year, the company earned $0.89 EPS. The firm’s revenue was up 12.6% compared to the same quarter last year.

Here are the key takeaways from Knife River’s conference call:

• Positive Sentiment: Revenue guidance was raised to $3.4 billion-$3.6 billion, while adjusted EBITDA guidance was reaffirmed at $520 million-$560 million; management expects about 55% of full-year EBITDA in the third quarter.
• Positive Sentiment: Underlying operations remained strong, with second-quarter revenue up 13%, double-digit volume growth across materials, and like-for-like adjusted EBITDA up 7% excluding asset-sale gains. Aggregate, ready-mix, and asphalt gross profit increased 12%, 21%, and 24%, respectively.
• Neutral Sentiment: Results were pressured by approximately $24 million of fuel costs, weather, project delays, and unfavorable contracting-services work mix. Fuel escalators and project bonuses should provide some recovery in the second half, but much of the delayed Texas, Hawaii, and Alaska work is now expected to shift into 2027.
• Negative Sentiment: Contracting-services margins faced competitive bidding pressure, particularly tied to limited Oregon paving activity, while lower-margin legacy acquisition projects are expected to weigh primarily through the third quarter. Aggregate margin expansion is now expected to be closer to 100 basis points rather than the previously targeted 200 basis points.
• Positive Sentiment: Management highlighted strong long-term demand from infrastructure, data centers, semiconductor facilities, and energy projects, alongside a healthy acquisition pipeline and approximately $140 million invested in organic growth initiatives. Net leverage is expected to return near the company’s 2.5-times long-term target by year-end.

Knife River Stock Down 10.1%

Shares of Knife River stock traded down $7.97 on Tuesday, hitting $70.87. 1,544,277 shares of the company’s stock traded hands, compared to its average volume of 591,652. The stock has a market cap of $4.02 billion, a P/E ratio of 27.51, a PEG ratio of 1.31 and a beta of 0.42. The company has a quick ratio of 1.31, a current ratio of 2.67 and a debt-to-equity ratio of 0.91. The firm’s 50-day moving average is $80.50 and its 200 day moving average is $81.40. Knife River has a 52-week low of $58.72 and a 52-week high of $96.28.

Institutional Trading of Knife River

Several institutional investors have recently added to or reduced their stakes in KNF. Barrow Hanley Mewhinney & Strauss LLC increased its position in Knife River by 57.7% in the fourth quarter. Barrow Hanley Mewhinney & Strauss LLC now owns 1,774,284 shares of the company’s stock worth $124,821,000 after buying an additional 648,979 shares during the period. Ameriprise Financial Inc. grew its position in Knife River by 30.1% in the 2nd quarter. Ameriprise Financial Inc. now owns 787,736 shares of the company’s stock valued at $64,311,000 after buying an additional 182,462 shares in the last quarter. Raymond James Financial Inc. lifted its stake in shares of Knife River by 71.0% in the 2nd quarter. Raymond James Financial Inc. now owns 354,860 shares of the company’s stock worth $28,971,000 after acquiring an additional 147,387 shares during the period. Dimensional Fund Advisors LP increased its stake in shares of Knife River by 11.6% during the fourth quarter. Dimensional Fund Advisors LP now owns 1,391,662 shares of the company’s stock valued at $97,909,000 after acquiring an additional 144,176 shares during the period. Finally, Price T Rowe Associates Inc. MD lifted its position in Knife River by 3.3% in the fourth quarter. Price T Rowe Associates Inc. MD now owns 3,915,131 shares of the company’s stock worth $275,431,000 after purchasing an additional 123,594 shares during the period. 80.11% of the stock is owned by institutional investors and hedge funds.

Wall Street Analyst Weigh In

A number of analysts have recently issued reports on KNF shares. Royal Bank Of Canada dropped their price objective on shares of Knife River from $109.00 to $107.00 and set an “outperform” rating on the stock in a research note on Tuesday, June 30th. Oppenheimer began coverage on shares of Knife River in a report on Thursday, May 28th. They set an “outperform” rating and a $95.00 price target for the company. Wells Fargo & Company lifted their price target on shares of Knife River from $80.00 to $81.00 and gave the stock an “underweight” rating in a research note on Wednesday, July 8th. Weiss Ratings upgraded shares of Knife River from a “hold (c-)” rating to a “hold (c)” rating in a report on Wednesday, May 27th. Finally, JPMorgan Chase & Co. boosted their price objective on shares of Knife River from $90.00 to $95.00 and gave the stock a “neutral” rating in a report on Wednesday, May 6th. One equities research analyst has rated the stock with a Strong Buy rating, six have issued a Buy rating, two have given a Hold rating and one has assigned a Sell rating to the company’s stock. Based on data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus price target of $97.14.

About Knife River

Knife River Corporation, headquartered in Bismarck, North Dakota, is a leading integrated construction materials and contracting company in the western United States. The company specializes in producing and supplying aggregates, asphalt mix, ready-mixed concrete and other heavy construction materials used in highway, commercial and residential projects.

In addition to material production, Knife River offers a comprehensive suite of contracting services, including heavy civil construction, road building, underground and open-pit mining and logistics support.