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Construction & Building Materials

Mercer Capital provides companies in the construction and building materials industry with independent valuation, transaction advisory, litigation support, and related advisory services

Recent Work

Structural Metal Steel Fabricator Business

Provided valuation of a minority interest for gift tax purposes.

Manufacturer and Distributor of Commercial Building Products

Provided valuation for funding of a buy-sell agreement.

Equipment Leasing and Warehouse Solutions Provider

Performed transaction and comparable company research to come to a conclusion of effective EV/EBITDA multiple range for LTIP operations.

Pipeline Construction Business

Provided valuation of a minority interest for gift tax purposes.

Commercial Building Construction Contractor

Provided valuation of various minority interests for gift tax and sale purposes.

Asset Holding Entity with Equipment Leasing and Construction Company Ownership

Provided minority interest valuation for gift tax compliance purposes.

Millwork Manufacturer and Distributor

Provided minority interest valuation for gift tax reporting purposes.

Residential Countertop Installation Business

Provided valuation of a 100% controlling equity interest for litigation support services.

Electronic Gate Manufacturer

Provided minority interest valuation for gift tax compliance purposes.

Crane Rental Business

Provided valuation of voting and nonvoting shares for shareholder redemption purposes.

Pipeline Construction Business

Provided valuation of a minority interest for shareholder dispute purposes.

General Contractor

Provided minority interest valuation for gift tax reporting purposes.

Mercer Capital provides independent valuation and related financial advisory services to construction and building materials companies. We support transactions, ownership changes, planning, financial reporting, and dispute-related matters for public and private companies across the sector.

Our professionals have deep experience valuing businesses across the construction and building materials spectrum, including contractors, manufacturers, distributors, and related service providers. We understand project-based and manufacturing operations, contract structures, cost and margin dynamics, supply chain considerations, and cyclical market conditions, delivering independent analyses that support informed decision-making and withstand scrutiny from key stakeholders.

What We Do

Services Overview

  • Gift, Estate, and Income Tax Compliance

  • Buy-Sell Agreements

  • Employee Stock Ownership Plans

  • M&A Representation Services

  • Fairness and Solvency Opinions

  • ESOP Advisory Services

  • Quality of Earnings Assessments

  • Portfolio Valuation Services

  • Purchase Price Allocation

  • Impairment Testing

  • Equity-Based Compensation Valuation

  • 280G Golden Parachute Valuation

  • Shareholder Disputes, Corporate Restructuring, and Dissolution

  • Family Law and Divorce

  • Tax-Related Controversies

  • Business Damages and Lost Profits

  • Valuation, Labor, and Contract Disputes

  • Consultation, Testimony, & Support

  • Shareholder Surveys & Education

  • Dividend & Redemption Policies

  • Capital Structure & Capital Budgeting

  • Performance Measurement & Benchmarking

Frequently Asked Questions

We work with a broad spectrum of industry participants, including general contractors, specialty subcontractors, heavy civil contractors, aggregates companies, ready-mix producers, equipment dealers, distributors, and manufacturers of building products. Our experience spans both private and public companies across the supply chain.

Owners and management teams often need independent valuations for shareholder transactions, ESOPs, tax reporting, financial reporting (ASC 350/805), M&A, and strategic planning. Because this industry is cyclical and often project-driven, a specialist who understands backlog, margins, capital intensity, and market dynamics is essential for a credible valuation.

Key drivers include backlog, contract mix (lump-sum vs. cost-plus), fleet condition and utilization, geographic footprint, customer concentration, safety record, margins, end-market diversity, and long-term demand indicators such as infrastructure spending and housing starts. For building materials producers, we also assess capacity constraints, pricing power, input costs, and distribution reach.

We use a combination of market, asset, and income methods to come to a conclusion of value for your business.

From an asset perspective, we look at the book value of the company, making adjustments for the market value of facilities, equipment, and vehicles. We also take into account necessary market value adjustments for liabilities and any off-balance sheet items.

For the market method, we look at comparable company multiples of EBITDA, revenue, and earnings, adjusting for differences in size, profitability, and growth.

For the income method, we derive an ongoing indication of cash flow or earnings available to the company, and capitalize it with an appropriate discount rate that captures the unique risk associated with holding an equity stake in the Company. In the case of more complex anticipated cash flows, we will project out 5-10 years of income statements to discount back to the present.

Backlog is a key indicator of near-term revenue visibility. We assess size, quality, margin expectations, contract type, customer relationships, historical conversion rates, and the competitiveness of the current bid environment. For building materials companies, we focus more on capacity utilization, regional demand, and pricing trends.

Absolutely. We advise clients throughout the M&A process, including valuation, quality of earnings, fairness and solvency opinions, and transaction support. Whether you are selling, buying, or evaluating strategic alternatives, we provide independent advice grounded in industry experience.

Key Contacts

Timothy R. Lee headshot
Timothy R. Lee

Managing Director

Nicholas J. Heinz headshot
Nicholas J. Heinz

Managing Director

Thomas C. Insalaco headshot
Thomas C. Insalaco

Senior Vice President

Andrew B. Frew headshot
Andrew B. Frew

Vice President

Newsletter

Construction Industry Newsletter

Mercer Capital provides a broad range of specialized valuation and transaction advisory services to the construction industry, including residential, commercial, civil, paving, concrete, and more.

Value Focus: The Construction Industry Newsletter is published quarterly. Each issue includes a segment focus, a market overview, a review of recent M&A activity in the industry, the performance of bellwether companies, and more. Segments covered are: Building Materials; Roads, Bridges, and Highways; Non-Residential Construction; and Residential Construction.

View previous issues

Insights

Thought leadership that informs better decisions — articles,  whitepapers, research, webinars, and more from the Mercer Capital team.

See All Firm Insights
Second Quarter 2025 | Segment Focus: Building Materials
Second Quarter 2025 | Segment Focus: Building Materials
Concrete prices grew at a steady rate over the past year, lumber prices experienced a significant drop in Q2 2025, and steel prices soared in the second quarter due to industry effects from tariffs. The Trump Administration’s “Liberation Day” tariffs took effect early in the quarter, leading to an immediate sell-off in the market. However, major indexes recovered quickly. Trade policy is in a state of limbo as the administration continues to negotiate terms with trading partners.
First Quarter 2025 | Segment Focus: Residential Construction
First Quarter 2025 | Segment Focus: Residential Construction
Growth in residential and non-residential building sectors has slowed, with Value Put-in-Place up 2.8% and 2.9% Y-o-Y, respectively, on a seasonally adjusted annual basis. Residential building sentiment has slowed, as the NAHB Housing Market and Remodeling Market Indices have fallen 23.5% and 4.6% Y-o-Y as of Q1 2025. The presence of a new presidential administration and policy will have a significant impact on the industry.
Vulcan Materials’ Acquisition of U.S. Concrete
Vulcan Materials’ Acquisition of U.S. Concrete
As participants in and observers of mergers and acquisitions, the 2021 acquisition of U.S. Concrete, Inc. (“U.S. Concrete”) by Vulcan Materials Company (“Vulcan Materials”) (NYSE: VMC) is a terrific opportunity to study the valuation nuances of the construction and building materials industry. In this article, we look at the fairness opinions delivered by Evercore and BNP Paribas rendered to the U.S. Concrete board regarding the transaction and provide some observations on the methodologies utilized by these two investment banks.
Fourth Quarter 2024 | Segment Focus: Non-Residential Construction
Fourth Quarter 2024 | Segment Focus: Non-Residential Construction
Both the residential and non-residential building sectors have enjoyed strong years thus far, with Value Put-inPlace up 5.7% and 3.6% Y-o-Y, respectively, on a seasonally adjusted annual basis. Non-residential construction has experienced strong tailwinds from elevated growth in corporate profits, though this has slowed during the fourth quarter of 2024.
Third Quarter 2024 | Segment Focus: Roads, Bridges, and Highways
Third Quarter 2024 | Segment Focus: Roads, Bridges, and Highways
Both the residential and non-residential building sectors have enjoyed strong years thus far, with Value Put-inPlace up 4.9% and 5.6% Y-o-Y, respectively, on a seasonally adjusted annual basis. The median sales price of houses sold has further moderated in 2024. Elevated rates and commodity input prices have proved to be strong headwinds for industry activities.
Second Quarter 2024 | Segment Focus: Building Materials
Second Quarter 2024 | Segment Focus: Building Materials
Residential construction has seen a Q-o-Q increase of 3.6% in value put in place on a seasonally adjusted annual rate basis. The median sales price of houses sold has continued to stabilize following sharp increases in 2021 and 2022. Elevated rates and commodity input prices have proved to be strong headwinds for industry activities.
Second Quarter 2020 | Segment Focus: Building Materials
Second Quarter 2020 | Segment Focus: Building Materials
Construction designated as an “essential” sector throughout most of the country, allowing construction companies to continue to work although in the face of a multitude of disruptions. Signs of economic fallout started to appear in late 1Q20 data but 2Q20 demonstrated a more comprehensive picture of the effects of the virus on economic barometers.
First Quarter 2020 | Segment Focus: Residential Construction
First Quarter 2020 | Segment Focus: Residential Construction
Construction has been designated as an “essential” sector throughout most of the country, allowing construction companies to continue to work in the face of a multitude of disruptions. A lower housing supply entering the pandemic, low mortgage rates, and government program support such as the CARES Act have helped support the housing market in the initial phase of the crisis.
Fourth Quarter 2019 | Segment Focus: Nonresidential Construction
Fourth Quarter 2019 | Segment Focus: Nonresidential Construction
Nonresidential construction spending increased in 2019 led by public infrastructure, office, and transportation spending.
Third Quarter 2019 | Segment Focus: Roads, Bridges, and Highways
Third Quarter 2019 | Segment Focus: Roads, Bridges, and Highways
State and local governments have increased spending on much-needed infrastructure projects but are beginning to face budgetary constraints and the expiration of FAST Act funding.
Second Quarter 2019 | Segment Focus: Building Materials
Second Quarter 2019 | Segment Focus: Building Materials
Ongoing trade tensions and uncertainty have cast a cloud over future business investment. State and local governments have increased spending on much-needed infrastructure projects.
First Quarter 2019 | Segment Focus: Residential Construction
First Quarter 2019 | Segment Focus: Residential Construction
Housing market activity picks up after a tepid second half of 2018 as mortgage rates decline and ease concerns over affordability. 30-year mortgage rates and 10 year treasury yields declined 17 and 27 basis points respectively year-over-year.
Fourth Quarter 2018 | Segment Focus: Nonresidential Construction
Fourth Quarter 2018 | Segment Focus: Nonresidential Construction
Key themes in construction industry mergers and acquisitions have been consolidation as retiring baby boomers look for exit opportunities and the rise of construction technology and software companies.
Third Quarter 2018 | Segment Focus: Roads, Bridges, and Highways
Third Quarter 2018 | Segment Focus: Roads, Bridges, and Highways
U.S. roads, bridges, and highways require attention and may receive it with an anticipated large increase in transportation infrastructure projects.
Second Quarter 2018 | Segment Focus: Building Materials
Second Quarter 2018 | Segment Focus: Building Materials
Favorable macroeconomic environment is driving increased construction on all fronts – residential, nonresidential, public. In addition, U.S. tax overhaul already boosting nonresidential construction through 2Q18.
First Quarter 2018 | Segment Focus: Residential Construction
First Quarter 2018 | Segment Focus: Residential Construction
Favorable macroeconomic environment leads to increased residential construction activity and new home sales in the midst of existing home inventory shortages. 30-year mortgage rates and 10-year Treasury yields increased 24 and 36 BPS year-over-year.
First Quarter 2017 | Segment Focus: Residential Construction
First Quarter 2017 | Segment Focus: Residential Construction
30-Year mortgage rates and 10-Year treasury yields have increased 51 and 59 BPS year-over-year. Favorable macroeconomic environment led to increased residential construction activity and home sales.