Abstract

Knife River Corp will report fiscal fourth-quarter 2025 results Pre-Market on February 17, 2026; this preview consolidates company guidance, recent operating trends, and consensus-type forecasts to frame revenue, margin, EPS, and segment dynamics for the upcoming print.

Market Forecast

For the current quarter, Knife River Corp’s revenue is projected at $726.10 million, with forecast year-over-year growth of 11.18%; EBIT is estimated at $51.81 million with 44.21% year-over-year growth, and EPS is estimated at $0.41 with 21.24% year-over-year growth. Company-level margins are expected to normalize seasonally versus peak construction months; no explicit gross profit margin or net margin forecast was provided in guidance, but the implied EBIT and EPS progression suggests positive operating leverage year over year.

Knife River Corp’s main business centers on construction materials and contracting services; the outlook underscores steady demand across aggregates, ready-mix, and asphalt, and disciplined bidding in contracting supporting backlog quality and cash conversion. The segment with the strongest near-term potential is construction materials, which delivered $647.28 million last quarter and is positioned to benefit from infrastructure funding tailwinds on a year-over-year basis.

Last Quarter Review

Knife River Corp posted fiscal third-quarter 2025 revenue of $1.20 billion, a gross profit margin of 23.77%, GAAP net profit attributable to the parent of $143.00 million, a net profit margin of 11.89%, and adjusted EPS of $2.52; revenue grew 8.90% year over year while adjusted EPS declined 3.08% year over year.

A key financial highlight was robust sequential profitability, with net profit up 182.89% quarter over quarter; this reflected peak season volume, disciplined pricing across materials, and cost controls that preserved margin despite mixed input inflation. Main business highlights included construction materials revenue of $647.28 million and contracting services revenue of $556.44 million, with a balanced contribution that helped smooth regional demand variability; year-over-year segment growth specifics were not disclosed, but the consolidated revenue expansion indicates healthy end-market activity.

Current Quarter Outlook

Main Business: Construction Materials

Construction materials—spanning aggregates, ready-mix concrete, and asphalt—remains the operational anchor for Knife River Corp this quarter. The company’s fourth-quarter forecast shows revenue of $726.10 million alongside improving EBIT and EPS year over year, signaling that pricing discipline and mix should offset typical winter season volume headwinds in northern markets. Aggregates pricing, often set on annual or semiannual cycles, tends to provide revenue visibility; combined with asphalt index mechanisms, this supports margin predictability when input costs move.

Seasonality is important: fourth quarters typically reflect fewer paving days and lower construction volumes in colder regions, implicating utilization and fixed-cost absorption. The market’s 44.21% year-over-year EBIT growth estimate suggests stronger margin capture compared with last year’s winter quarter, likely derived from: improved plant reliability, rationalized trucking and logistics, and project timing that shifts more revenue into shoulder months. Management’s focus on targeted capital spending in quarries and asphalt plants should enhance throughput and reduce per-unit cost, further supporting gross margin resilience.

Operationally, aggregates volumes tie to state and municipal project schedules. Infrastructure programs can sustain base demand even when private construction pauses, mitigating cyclicality and offering better backlog predictability. Because gross margin recovered to 23.77% in the peak quarter, investors will watch how much of that improvement carries into winter despite lower volumes. A decisive indicator will be the materials segment’s margin per ton and price-cost spreads, which underpin the EPS estimate of $0.41 growing 21.24% year over year.

Most Promising Business: Contracting Services

Contracting services, which integrates knife-edge bid discipline, project management, and execution across paving, sitework, and infrastructure packages, is strategically positioned to translate backlog quality into earnings. Although revenue contribution in the last quarter was smaller than materials—$556.44 million versus $647.28 million—contracting is a lever for mixed margin enhancement when projects are bid with escalation clauses and when resource scheduling improves efficiency. In the current quarter, contracting can provide revenue continuity in milder climates and for indoor or specialized civil work less affected by weather.

The forecasted EBIT growth of 44.21% year over year suggests better project margins relative to last year’s winter quarter. Drivers include tighter bid selectivity that avoids thin-margin work, and improved change-order capture that reduces margin leakage. The interplay with materials is important: internal sourcing of aggregates and asphalt can stabilize contracting margins by reducing input volatility and ensuring supply reliability. Execution metrics—like on-time completion rates and reduced rework—will influence gross margin, and strong performance can tilt overall profitability positively even if revenues are seasonally lighter.

Risk-wise, contracting services is sensitive to labor availability and equipment utilization in colder months; delays can push revenue into the next quarter. However, backlog quality and diversified geography often reduce reliance on any single weather pattern. In this context, balanced project phasing and staggered mobilizations should support EPS even when nominal revenue is below peak-season levels.

Stock Price Drivers This Quarter

The stock will likely react to margin sustainability more than headline revenue, given seasonality. A key determinant is whether gross profit margin holds above last year’s winter level through price-cost discipline in materials, and through better project margins in contracting services. The forecast points to EPS growth of 21.24% year over year; if reported adjusted EPS approaches or exceeds $0.41 while demonstrating clean quality (limited one-time items), shares could respond favorably.

Another driver is the composition of revenue: a higher mix of internally sourced materials tends to raise consolidated margins and cash conversion. Investors will scrutinize working capital, especially receivables and unbilled balances in contracting, to confirm strong cash generation amid seasonal demand. Any update on backlog duration and bid pipeline—particularly state DOT and municipal infrastructure funded work—can influence sentiment about spring ramp visibility.

Finally, cost management and input inflation will be in focus. Stable fuel and cementitious materials pricing, alongside proactive procurement, can compress cost volatility. If Knife River Corp shows that energy surcharges and index-based escalators work as intended, margin predictability improves. Conversely, adverse weather, unexpected project delays, or sharp input cost moves could pressure quarter results and the stock.

Analyst Opinions

Across recent institutional commentary covering Knife River Corp within the specified window, the prevailing tone is cautiously constructive, leaning bullish on execution and margin normalization into the spring build season. The majority view emphasizes that guidance and internal forecasts point to year-over-year improvement in EBIT and EPS for the fourth quarter, with the materials segment underpinning profitability and contracting services bolstering backlog visibility. Analysts highlight that the 11.18% revenue growth projection aligns with infrastructure-related demand resilience while leaving room for upside if weather proves favorable and if price-cost dynamics remain supportive.

Representative views from notable sell-side desks indicate a focus on margin quality rather than absolute revenue. Firms with constructive stances cite Knife River Corp’s pricing discipline in aggregates and asphalt, tighter bid processes in contracting, and capital allocation toward plant reliability as reasons for improved EBIT conversion versus last year’s winter quarter. The consensus among these institutions is that near-term seasonality will cap volume, but operating leverage should still yield EPS growth consistent with the forecasted 21.24% year-over-year increase. In evaluating risks, the majority acknowledges potential weather and backlog timing effects but contends that these are manageable within the current business mix and procurement practices.

Market commentary further suggests investors will benchmark the upcoming print against last quarter’s robust 23.77% gross margin and 11.89% net margin, looking for signs that winter margins can stay above prior-year levels even as revenue normalizes. The bullish cohort expects Knife River Corp to deliver at or near the forecasted $51.81 million EBIT, supported by balanced segment contribution and stable materials pricing. Should Knife River Corp demonstrate healthy cash conversion and reiterate a constructive spring outlook, the majority anticipates ongoing positive sentiment into the next seasonal peak, consistent with the cautiously constructive bias that currently dominates institutional perspectives.