Arcosa, Inc.'s (NYSE:ACA) Share Price Matching Investor Opinion

Arcosa, Inc.'s (NYSE:ACA) price-to-earnings (or "P/E") ratio of 36.5x might make it look like a strong sell right now compared to the market in the United States, where around half of the companies have P/E ratios below 19x and even P/E's below 11x are quite common. Although, it's not wise to just take the P/E at face value as there may be an explanation why it's so lofty. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. Arcosa certainly has been doing a good job lately as it's been growing earnings more than most other companies. It seems that many are expecting the strong earnings performance to persist, which has raised the P/E. You'd really hope so, otherwise you're paying a pretty hefty price for no particular reason. View our latest analysis for Arcosa NYSE:ACA Price to Earnings Ratio vs Industry December 29th 2025 Keen to find out how analysts think Arcosa's future stacks up against the industry? In that case, our free report is a great place to start. Is There Enough Growth For Arcosa? In order to justify its P/E ratio, Arcosa would need to produce outstanding growth well in excess of the market. Taking a look back first, we see that the company grew earnings per share by an impressive 15% last year. Pleasingly, EPS has also lifted 46% in aggregate from three years ago, thanks to the last 12 months of growth. Therefore, it's fair to say the earnings growth recently has been superb for the company. Looking ahead now, EPS is anticipated to climb by 52% during the coming year according to the five analysts following the company. With the market only predicted to deliver 16%, the company is positioned for a stronger earnings result. In light of this, it's understandable that Arcosa's P/E sits above the majority of other companies. It seems most investors are expecting this strong future growth and are willing to pay more for the stock. What We Can Learn From Arcosa's P/E? While the price-to-earnings ratio shouldn't be the defining factor in whether you buy a stock or not, it's quite a capable barometer of earnings expectations. As we suspected, our examination of Arcosa's analyst forecasts revealed that its superior earnings outlook is contributing to its high P/E. At this stage investors feel the potential for a deterioration in earnings isn't great enough to justify a lower P/E ratio. Unless these conditions change, they will continue to provide strong support to the share price. You should always think about risks. Case in point, we've spotted 1 warning sign for Arcosa you should be aware of. It's important to make sure you look for a great company, not just the first idea you come across. So take a peek at this free list of interesting companies with strong recent earnings growth (and a low P/E). Mobile Infrastructure for Defense and DisasterThe next wave in robotics isn't humanoid. Its fully autonomous towers delivering 5G, ISR, and radar in under 30 minutes, anywhere.Get the investor briefing before the next round of contractsSponsored On Behalf of CiTech