Centuri Holdings, Inc. (CTRI): A Bull Case Theory

We came across a bullish thesis on Centuri Holdings, Inc. on Valueinvestorsclub.com by Robot1. In this article, we will summarize the bulls’ thesis on CTRI. Centuri Holdings, Inc.'s share was trading at $21.68 as of September 8th. CTRI’s forward P/E was 21.51 according to Yahoo Finance.

Centuri Holdings, Inc. (CTRI) represents a compelling investment opportunity, driven by improving end markets, accelerating fundamentals, and a resilient business model anchored in long-term Master Service Agreements (MSAs) with blue-chip utility customers. The company, a North American utility infrastructure services provider with over a century of operating history, went public in April 2024 and remains majority-owned by Southwest Gas Holdings (SWX), which is gradually selling down its stake.

CTRI’s services focus on the modernization, maintenance, and expansion of electric and natural gas distribution and transmission networks, with over 80% of revenue derived from long-term, high-visibility MSA relationships. Average customer tenure exceeds twenty years, and MSA renewal rates approach 100%, providing stable, recurring cash flows and low project risk. Historically, Centuri delivered an 8.5% organic revenue CAGR through 2024, and demand for its services is supported by aging infrastructure, increased utility capex, and incremental tailwinds such as load growth, data center projects, and storm restoration work.

Following early public company challenges—including a CEO resignation shortly after the IPO and overly ambitious initial guidance—the company appointed Chris Brown as CEO in December 2024. Brown, an experienced turnaround executive, has already accelerated growth initiatives, established new KPIs, and expanded the sales pipeline to over $12 billion, with 1Q and 2Q 2025 bookings totaling $2.5 billion and a record backlog of $4.5 billion. Under his leadership, the company is shifting from a utility-owned, maintenance-focused operation to a growth-oriented service provider.

At roughly 10.5x 2025e EBITDA, CTRI trades at a discount to peers despite its lower risk profile and recurring revenue base. With high single-digit to low double-digit revenue growth expected, modest margin improvement, and cost optimization underway, CTRI could reach $300 million EBITDA in 2026, implying nearly 50% upside from current prices.

Key catalysts include upcoming 2Q earnings, potential investor day guidance, and 2026 consensus-beating guidance. Risks include earnings misses, accelerated secondary stock sales, and exposure to fixed-price projects. Overall, CTRI combines a resilient, recurring revenue model with strong growth potential under transformative leadership, making it a uniquely attractive opportunity in the utility services sector.

Previously we covered a bullish thesis on UGI Corporation (UGI) by Investing 501 in January 2025, which highlighted efforts to stabilize or divest AmeriGas while leveraging growth in Utilities, Midstream & Marketing, and International LPG. The stock has appreciated approximately 12.27% since coverage. The thesis still stands as UGI’s core businesses remain profitable. Robot1 shares a similar perspective but emphasizes Centuri Holdings’ growth under a new CEO with long-term MSAs and a large backlog.

Centuri Holdings, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 10 hedge fund portfolios held CTRI at the end of the first quarter which was 7 in the previous quarter. While we acknowledge the potential of CTRI as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.