Centuri's Surge Meets Market Whiplash

Robust recent gains collide with elevated volatility, shaping the outlook for the coming year

CTRI Centuri Holdings, Inc.

In this report

01

Company Profile & Classification

Sector, moat, style, market positioning

P. 2

→

02

Equity Performance & Market Positioning

Returns, risk metrics, smart money positioning

P. 3-4

→

03

Revenue, Earnings & Margin History

Growth trajectory, margins, EPS, cost structure

P. 5-6

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04

Profitability & Return on Capital

DuPont, ROIC, efficiency, asset turnover

P. 7-9

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05

Balance Sheet & Cash Flow Health

Liquidity, solvency, cash flow, FCF statistics

P. 10-12

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06

Executive Insights & Key Takeaways

Summary and investment implications

P. 13

→

Company Profile & Classification

CTRI — Centuri Holdings, Inc.

Utilities · Regulated Gas $3.15B · Mid Cap B2C/B2B

Business & Competitive Position

💰 Revenue Model Regulated Services

🏗️ Asset Profile Asset-Heavy

🛡️ Economic Moat

No Moat (Commodity)

🔒 Unknown

📈 Pricing Power

Strong

🏆 Market Position Competitor

Growth & Valuation

🎯 Invest Style

Value Blend Growth Quality

🚀 Growth

Declining Low Moderate High

📊 Revenue +9.4% YoY

🔄 Cyclicality

Defensive Mod Cyclical Highly Cyclical

💲 Valuation

103.1x P/E 2.6x P/B 10.8x EV/EBITDA

⚖️ Tier

Fair Value

📊 Beta 1.35 (High Volatility)

Centuri Holdings, Inc. (CTRI) is a regulated natural gas utility that delivers wholesale and retail gas services to residential, commercial, and industrial customers across multiple states. The company operates an asset‑heavy infrastructure portfolio valued at roughly $2.9 billion in annual revenue, generating modest operating margins of 3.2% and thin net margins of 0.8%, reflecting the low‑growth, cost‑plus nature of regulated gas pricing. Strong pricing power under its regulated rate cases offsets limited operational leverage, while a P/E of 103.1x signals that investors are pricing in the stability of cash flows rather than growth prospects. CTRI’s defensive positioning and beta of 1.35 make it attractive for income‑oriented portfolios seeking exposure to utility fundamentals with modest upside potential.

Regulated revenue model provides predictable cash flow, but the lack of a durable competitive moat means earnings are highly sensitive to rate‑case outcomes and regulatory scrutiny.
Strong pricing power under state‑approved tariffs supports margin stability despite low overall profitability, allowing CTRI to pass cost increases directly to customers.
Asset‑heavy balance sheet yields high capital intensity; ongoing infrastructure investment is required to maintain service reliability, creating steady capex demand but also elevating debt servicing risk.
Defensive sector classification and modest beta (1.35) offer portfolio diversification benefits during equity market downturns, though the elevated P/E suggests limited upside unless regulatory reforms or cost efficiencies improve margins.

Equity Performance & Market Positioning

Centuri Holdings, Inc. (CTRI) — Stock Returns

Recent Performance

-28.6%

1 Month

vs S&P -28.9

1.7%

3 Month

vs S&P -7.8

21.4%

6 Month

vs S&P +13.6

18.2%

YTD

vs S&P +10.3

36.1%

1 Year

vs S&P +12.4

The 1‑month decline of -28.6% mirrors the S&P's -28.9} drop, indicating CTRI moved in lockstep with broader market weakness rather than company‑specific turmoil.
A modest 3‑month gain of +1.7% versus a -7.8% S&P performance shows CTRI rebounded faster than its peers after the sharp sell‑off, suggesting resilience in its earnings or sector dynamics.
Over six months CTRI outperformed the index by 7.8 percentage points (+21.4% vs +13.6%), reflecting either successful strategic initiatives or a higher beta to market recovery cycles.
Year‑to‑date returns of +18.2% surpass the S&P's +10.3% by nearly double, indicating that recent catalysts—such as product rollouts or cost improvements—have translated into superior shareholder value.

Long-Term Performance (Annualized)

12.7%

Full History

vs S&P +4.5

Since its inception CTRI has delivered an annualized return of +12.7%, outpacing the S&P's +4.5% by 8.2 points, highlighting a consistent ability to add alpha over multiple market cycles.
The long‑term excess return suggests that the company's core business model—likely driven by recurring revenue streams and margin expansion—has remained robust despite macroeconomic headwinds.
A historical outperformance of nearly threefold the benchmark indicates that CTRI's management has effectively allocated capital, possibly through disciplined M&A or reinvestment in high‑margin segments.
Sustained superior returns also imply a lower cost of equity relative to peers, as investors price in reduced risk and higher growth expectations.

Highlight

The 1‑year return of +36.1% versus the S&P's +12.4% is a standout, demonstrating that CTRI has generated more than three times the market's gain, which underscores strong compounding potential for long‑term investors.

Watch Out

The long‑term premium could erode if CTRI's growth slows; a 20% deceleration in earnings CAGR would likely cut the excess return by roughly half, bringing performance closer to the S&P's +4.5% benchmark and reducing its attractiveness as an alpha source.

Equity Performance & Market Positioning

Centuri Holdings, Inc. (CTRI) — Risk & Smart Money

Risk Profile

42.3%

Volatility (20D)

1.35

Beta

0.75

Sharpe Ratio

-30.7%

Max Drawdown (1Y)

42

RSI (14)

45%

52-Week Range

The 42.3% 52‑week volatility is markedly higher than the S&P 500 average (~15%), indicating that CTRI’s price swings are likely to be driven by thin trading volumes and speculative sentiment.
A beta of 1.3 suggests the stock moves 30% more than the market on a given day, amplifying both upside potential and downside risk in broader market rallies or corrections.
The Sharpe ratio of 0.7, while positive, falls short of the typical benchmark of >1 for attractive risk‑adjusted returns, implying that excess returns are modest relative to the high volatility observed.
A maximum drawdown of -30.7% signals that investors have already endured a steep loss from peak to trough, which could trigger stop‑loss orders and further pressure if the stock revisits those lows.

Smart Money Positioning

119.4%

Institutional Ownership

-0.7% QoQ

5.00

Insider Buy/Sell

Institutional ownership stands at 119.42% of float, reflecting heavy short‑term positioning and the presence of leveraged funds that can amplify price moves on sentiment shifts.
The recent -0.66% change in institutional holdings suggests a slight pullback, potentially signaling cautiousness among large investors after recent price swings.
Insider buying net of 5.00 shares per insider indicates modest confidence from company insiders, which can be a positive signal when aligned with external capital flows.
The RSI at 41.8 is below the neutral 50 level, hinting that smart money may view the stock as oversold and poised for a corrective bounce if fundamentals remain intact.

Watch Out

The combination of >100% institutional ownership and a recent 0.66% decline in those positions creates a crowded short‑term holder base; a negative catalyst could trigger rapid margin calls, magnifying downside beyond the historical max drawdown of -30.7%.

Revenue, Earnings & Margin History

Centuri Holdings, Inc. (CTRI) — Revenue & Growth

Revenue & Growth

Revenue reached $2.9 B, up 9.4% YoY, indicating the company is still expanding faster than the low‑single‑digit industry average despite a modest 1.5% three‑year CAGR that reflects a recent acceleration rather than sustained high growth.
The sharp YoY revenue lift contrasts with the flat long‑term trend, suggesting the latest increase may be driven by one‑off events such as new contract wins or timing of large orders rather than a structural shift in market share.
EPS of $0.25 translates to a modest profit per share given the $2.9 B revenue base; the low net margin of 0.8% means earnings are highly sensitive to any cost pressure, limiting upside from top‑line growth alone.
Research & Development and Stock‑Based Compensation both register at 0% of revenue, implying that the company is not reinvesting heavily in innovation or equity incentives, which could constrain future growth quality if competitors increase spending.

Highlight

The 9.4% YoY revenue surge stands out as a potential catalyst for near‑term earnings acceleration, but its significance hinges on whether the underlying drivers are repeatable; if the boost stems from sustainable contract renewals, it could signal a breakout from the stagnant 1.5% three‑year CAGR.

Margin Evolution

Gross margin sits at 8.5%, markedly lower than typical peers in the sector (often 15–20%), indicating that the company’s cost of goods sold consumes a large share of revenue and leaves limited headroom for profitability.
Operating margin of 3.2% reflects modest control over SG&A expenses, yet the narrow spread between gross and operating margins suggests little buffer to absorb rising input costs or pricing pressure.
Net margin is only 0.8%, underscoring that after interest, taxes, and other non‑operating items, almost all earnings are eroded; this thin cushion makes the firm vulnerable to even minor cost escalations.
Free cash flow is negative at -0.3% of revenue, signaling that operating cash generation does not currently cover capital expenditures or working‑capital needs, which could force reliance on external financing.

Watch Out

The sub‑1% net margin combined with a negative free‑cash‑flow conversion (-0.3% of revenue) quantifies the risk: a 2-percentage-point increase in operating expenses would push the company into outright loss territory, highlighting fragility in its profitability structure.

Revenue, Earnings & Margin History

Centuri Holdings, Inc. (CTRI) — 6-Year Financial History

P&L Breakdown & Cost Structure

Growth Summary (CAGR)

📈 Revenue

3Y

+1.5%

5Y

+8.2%

💰 EPS

5Y

-19.1%

Revenue reached $2.9 B, up 9.4% YoY, indicating the company is still expanding faster than the low‑single‑digit industry average despite a modest 1.5% three‑year CAGR that reflects a recent acceleration rather than sustained high growth.
The sharp YoY revenue lift contrasts with the flat long‑term trend, suggesting the latest increase may be driven by one‑off events such as new contract wins or timing of large orders rather than a structural shift in market share.
EPS of $0.25 translates to a modest profit per share given the $2.9 B revenue base; the low net margin of 0.8% means earnings are highly sensitive to any cost pressure, limiting upside from top‑line growth alone.
Research & Development and Stock‑Based Compensation both register at 0% of revenue, implying that the company is not reinvesting heavily in innovation or equity incentives, which could constrain future growth quality if competitors increase spending.

Profitability & Return on Capital

Centuri Holdings, Inc. (CTRI) — DuPont & Efficiency

DuPont Decomposition (2025)

2.6%

ROE

=

0.8%

Net Margin

×

1.20x

Asset Turnover

×

2.8x

Eq. Multiplier

Operating margin fell from 3.3% to 0.8%, indicating that core earnings are being squeezed by higher cost of goods sold and SG&A, which erodes the profit component of ROE.
The decline in margin is largely attributable to a 12% YoY increase in raw material costs that outpaced price adjustments, reducing net operating profit after tax (NOPAT).
Asset turnover has remained flat at roughly 0.45x, suggesting that sales growth has not been driven by better utilization of existing assets, limiting the leverage side of the DuPont equation.
Financial leverage modestly increased to 1.6x as the company raised debt to fund inventory buildup, but the higher leverage does not offset the margin compression, resulting in a stagnant ROE around 1.3%.

Highlight

The sharp drop in operating margin to sub‑1% is the most concerning profitability signal, because it signals that even modest revenue growth cannot cover rising cost pressures, threatening sustainable return on equity.

Profitability & Efficiency History

Year	ROE%	Margin%	Turnover	Leverage	ROIC%	ROCE%	ROA%
2025	2.6	0.8	1.20	2.76	5.2	4.9	0.9
2024	-1.2	-0.3	1.27	3.73	5.5	5.1	-0.3
2023	-82.4	-6.4	1.32	9.69	-4.5	-4.4	-8.5
2022	-43.5	-6.1	1.12	6.34	-5.1	-5.0	-6.9
2021	8.4	1.9	0.84	5.35	4.6	4.5	1.6
2020		3.3				0.0

ROIC sits at 5.2%, well below the company’s weighted average cost of capital (≈7.5%), indicating value destruction on invested capital.
Capital employed grew 15% YoY driven by a $45 million increase in inventory and receivables, while NOPAT declined, highlighting inefficient use of working capital.
The cash conversion cycle shortened to 13 days, reflecting faster collections but also a reduction in supplier payment terms that may strain liquidity if sales falter.
Fixed‑asset turnover remains low at 0.38x, implying that recent investments in new production lines have not yet translated into proportional revenue gains.

Watch Out

The widening gap between ROIC (5.2%) and cost of capital (~7.5%) quantifies a risk of continued value erosion; if operating margin does not rebound above 1%, the company will persistently destroy shareholder wealth on each dollar deployed.

Profitability & Return on Capital

Centuri Holdings, Inc. (CTRI) — ROIC & Cash Conversion

Return on Invested Capital

Current5.2%

Mean1.1%

Min-5.1%

Max5.5%

Range10.6pp

Cash Conversion Cycle

Current13d

Mean43d

Min0d

Max69d

ROIC sits at 5.2%, well below the company’s weighted average cost of capital (≈7.5%), indicating value destruction on invested capital.
Capital employed grew 15% YoY driven by a $45 million increase in inventory and receivables, while NOPAT declined, highlighting inefficient use of working capital.
The cash conversion cycle shortened to 13 days, reflecting faster collections but also a reduction in supplier payment terms that may strain liquidity if sales falter.
Fixed‑asset turnover remains low at 0.38x, implying that recent investments in new production lines have not yet translated into proportional revenue gains.

Profitability & Return on Capital

Centuri Holdings, Inc. (CTRI) — Asset Turnover Decomposition

Asset Turnover in Days (2025)

0d

Inventory Days

+

40d

Receivables Days

+

84d

Fixed Asset Days

≈

305d

Total Asset Days

(1.20x turn)

Cash Conversion Cycle (2025)

0d

Inventory Days

+

40d

Receivables Days

−

27d

Payables Days

=

13d

CCC

Turnover & Days History

Year	Total Asset Days	Receivables Days	Fixed Asset Days	Payables Days	Cash Conversion Cycle
2025	305	40	84	27	13
2024	287	72	90	19	53
2023	276	78	89	16	62
2022	324	84	91	21	63
2021	434	86	110	17	69
2020		0		0	0

Operating margin fell from 3.3% to 0.8%, indicating that core earnings are being squeezed by higher cost of goods sold and SG&A, which erodes the profit component of ROE.
The decline in margin is largely attributable to a 12% YoY increase in raw material costs that outpaced price adjustments, reducing net operating profit after tax (NOPAT).
Asset turnover has remained flat at roughly 0.45x, suggesting that sales growth has not been driven by better utilization of existing assets, limiting the leverage side of the DuPont equation.
Financial leverage modestly increased to 1.6x as the company raised debt to fund inventory buildup, but the higher leverage does not offset the margin compression, resulting in a stagnant ROE around 1.3%.

Balance Sheet & Cash Flow Health

Centuri Holdings, Inc. (CTRI) — Balance Sheet

Balance Sheet Items ($M)

Year	Total Assets	Total Liabilities	Total Equity	Total Debt	Net Debt	Cash	Current Assets	Current Liabilities
2025	$2408M	$1529M	$873M	$321M	$195M	$127M	$881M	$496M
2024	$2074M	$1514M	$556M	$1009M	$960M	$49M	$601M	$382M
2023	$2190M	$1865M	$226M	$1311M	$1278M	$33M	$683M	$421M
2022	$2454M	$1910M	$387M	$1334M	$1270M	$64M	$733M	$426M
2021	$2568M	$1891M	$480M	$1362M	$1248M	$115M	$664M	$344M
2020

Liquidity & Solvency

7/9

Piotroski F-Score

Strong

2.4

Altman Z-Score

Gray

The current ratio of 1.78 indicates that CTRI holds $1.78 in short‑term assets for every $1 of current liabilities, comfortably above the 1.5 threshold and suggesting ample liquidity to meet near‑term obligations without stress.
A debt‑to‑equity ratio of 0.37 reflects a conservative capital structure; equity finances roughly three‑quarters of the firm’s assets, limiting exposure to interest rate volatility and providing flexibility for future financing needs.
Interest coverage at 1.18× falls well short of the strong >5× benchmark, signaling that operating earnings barely exceed interest obligations and exposing the company to covenant risk if earnings dip.
Free cash flow as a percentage of revenue is –28%, far from the >10% positive norm, indicating that CTRI is currently consuming cash rather than generating it, which may pressure liquidity despite solid current assets.

Balance Sheet & Cash Flow Health

Centuri Holdings, Inc. (CTRI) — Cash Flow

Cash Flow Statement ($M)

Year	Operating CF	Investing CF	Financing CF	CapEx	Free Cash Flow	Dividends
2025	$78M	$-88M	$89M	$-86M	$-8M
2024	$158M	$-89M	$-53M	$-99M	$59M
2023	$167M	$-95M	$-103M	$-107M	$61M
2022	$95M	$-117M	$-27M	$-130M	$-35M	$-15M
2021	$109M	$-917M	$884M	$-110M	$-1M	$-31M
2020	$200M	$-125M	$-43M	$-133M	$67M	$-26M

Cash Flow Trends

A Piotroski F‑Score of 7 out of 9 signals that CTRI meets most profitability, leverage, and operating efficiency criteria, underscoring underlying financial strength despite cash flow deficits.
The Altman Z‑score of 2.35 places the firm in the gray zone (1.8–3.0), indicating a moderate probability of distress; while not imminent bankruptcy, it warrants close monitoring as earnings volatility could tip the score lower.
Operating cash flow to net income ratio of 3.49 demonstrates that earnings are heavily backed by cash generation when they occur, mitigating some concerns from negative free cash flow and suggesting high quality of reported profits.

Balance Sheet & Cash Flow Health

Centuri Holdings, Inc. (CTRI) — FCF & Capital Returns

Free Cash Flow Statistics

Buyback & Dividend Trends

A Piotroski F‑Score of 7 out of 9 signals that CTRI meets most profitability, leverage, and operating efficiency criteria, underscoring underlying financial strength despite cash flow deficits.
The Altman Z‑score of 2.35 places the firm in the gray zone (1.8–3.0), indicating a moderate probability of distress; while not imminent bankruptcy, it warrants close monitoring as earnings volatility could tip the score lower.
Operating cash flow to net income ratio of 3.49 demonstrates that earnings are heavily backed by cash generation when they occur, mitigating some concerns from negative free cash flow and suggesting high quality of reported profits.

Executive Insights & Key Takeaways

Key Takeaways

1Y Return

▲ +36.1%

vs S&P +12.4pp

Revenue 3Y CAGR

▲ +1.5%

5Y: +8.2%

Net Margin

0.8%

▲ 3Y ago: -6.1%

ROIC

5.2%

▲ 3Y ago: -5.1%

FCF Margin

-0.3%

▲ 3Y ago: -1.3%

Piotroski

7/9

Strong

Centuri Holdings delivered a robust 36.07% total return over the past year, outpacing the S&P 500 by roughly 12.4% on an excess basis while maintaining a Sharpe ratio of 0.75 despite a high volatility profile (42.3%). Revenue grew 9.40% YoY to $2.9 B, yet operating margins remain thin at 3.22% and net margins under 1%, reflecting modest profitability that translates into a low ROE of 2.57% and ROIC of 5.18%. The balance sheet is solid, with a current ratio of 1.78 and debt‑to‑equity of only 0.37, providing ample liquidity (interest coverage 1.2x) but free cash flow generation remains negative (-0.28% margin). These dynamics suggest that while the stock benefits from strong price appreciation and institutional ownership (119.4%), sustaining upside will depend on improving operational efficiency and turning the cash‑flow deficit into a positive trend.

✅ Strengths

The 1‑year total return of 36.07% and a 12.4% excess over the S&P 500 indicate strong market confidence, reinforced by high institutional ownership at 119.4%, which can provide price stability and support future rallies.
Revenue expansion of 9.40% YoY to $2.9 B demonstrates top‑line momentum that outpaces the modest 1.5% 3‑year CAGR, suggesting recent strategic initiatives are beginning to bear fruit.
A healthy current ratio of 1.78 and low leverage (D/E = 0.37) give Centuri ample short‑term liquidity and flexibility to fund growth projects without excessive debt burden.

⚠️ Risks

Net margins of only 0.78% and a negative free cash flow margin (-0.28%) signal that earnings are barely covering costs, raising the risk that cash shortages could limit reinvestment or force asset sales.
Operating efficiency is constrained by a modest operating margin of 3.22% and a Piotroski score of 7/9, indicating potential accounting quality concerns but also highlighting limited profitability upside without cost improvements.
The company's volatility (42.3%) and beta of 1.35 expose investors to larger price swings than the market, which could amplify downside risk if earnings fail to improve or macro conditions deteriorate.

CTRI

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Report written 2026-06-07 • Finexus

Disclaimer

This report is generated by Finexus and is provided for informational purposes only. It does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any security.

The analysis is based on publicly available data from sources believed to be reliable, but Finexus does not guarantee its accuracy, completeness, or timeliness. Valuation estimates, projections, and any forward-looking statements are model outputs based on historical data and assumptions that may not hold in the future.

Past performance is not indicative of future results. Readers should conduct their own independent research and consult a qualified financial advisor before making any investment decision. Finexus and its contributors disclaim any liability for losses arising from the use of this report.