KNF

Knife River is a vertically integrated, aggregates-based construction-materials and contracting company operating across 14 states, with 1.3 billion tons of aggregate reserves underpinning a durable, location-advantaged business. About 80% of contracting revenue comes from the more cyclically stable public sector, and the demand backdrop is favorable: the 10-K notes ~46% of IIJA formula funding ($1.2 trillion authorized through 2026) is still undistributed in its markets, ten of 14 states have record DOT budgets, and North Dakota's 2026 bid lettings are set to more than double. FY2025 revenue grew 8.5% to $3.15B.

Earnings, however, dipped: net income fell 22.1% to $157M and EPS 22.3% to $2.76. The decline reflects a heavy investment year — Knife River spent $611.7M acquiring five companies (adding ~30 years of reserves, 29 ready-mix and 5 asphalt plants), pushing depreciation up 41.5%, long-term debt up 73.0% to $1.15B, and leverage to 1.22x liabilities/equity, while capex doubled to $348M. Operating cash flow was solid at $278M (-13.6%), and margins held (18.4% gross). Management's EDGE margin initiatives and tariff pass-through clauses support profitability.