Mayville to Expand Its Footprint With the Accu-Fab Acquisition

Mayville Engineering Company, Inc. MEC has entered into a definitive agreement to acquire Accu-Fab, LLC from the strategic holding company, Tide Rock.

Expected to close during the third quarter of 2025, upon the satisfaction of customary closing conditions, the total value of the buyout stands at $140.5 million.

MEC stock grew 5.2% during yesterday’s trading hours after the acquisition announcement.

How Will the Accu-Fab Acquisition Benefit Mayville?

Accu-Fab is a vertically integrated contract manufacturer that offers value-added services, including design, engineering, sheet metal fabrication and integration, and specialized finishing to large OEMs. It operates manufacturing facilities at Raleigh, NC and Wheeling, IL, including approximately 200,000 square feet of manufacturing space.

With total net sales and adjusted EBITDA of approximately $61 million and $14 million, respectively, and an adjusted EBITDA margin of more than 23% in 2024, upon acquisition, Accu-Fab will prove incremental to MEC’s business. Mayville is expected to witness growth across its adjusted EBITDA, adjusted EBITDA margins and adjusted earnings per share (EPS), leaving room for long-term value creation potential from this strategic transaction.

Currently, Mayville expects the Accu-Fab acquisition to contribute $28-$32 million to its net sales and $6-$8 million to the adjusted EBITDA in 2025. Furthermore, through the effective implementation of its MBX framework across Accu-Fab’s footprint, MEC expects to generate about $1 million in annual cost synergies and improved utilization by 2026.

Per Jag Reddy, president and chief executive officer of Mayville, “This acquisition strengthens our commercial reach by accelerating entry into attractive new markets—an explicit priority within our MBX value creation framework. Accu-Fab’s strong customer relationships and value-added services present a compelling opportunity to leverage scale, operational discipline and commercial infrastructure to drive meaningful revenue and cost synergies.”

MEC Stock Price Performance

The share price performance of this value-added provider of design, prototyping and manufacturing solutions has soared 26.7% in the past month, outperforming the Zacks Engineering - R and D Services industry’s 13.3% growth.

The company’s focus on continuous operational improvements and cost discipline amid leveraging improving customer demand trends in the other end market and increased after-market demand in its Military end market is boding well. It aims to continue employing strategic pricing, alongside commercial growth and capital efficiency initiatives through its MBX value creation framework, to generate profitability amid macro uncertainties.

MEC’s strong fundamentals and future growth trajectory validate its VGM Score of A, backed by a Value Score of A and a Growth Score of B.

MEC’s Zacks Rank & Other Key Picks

Mayville currently carries a Zacks Rank #2 (Buy).

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Tutor Perini Corporation TPC currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The company delivered a trailing four-quarter earnings surprise of 264.7%, on average. The stock has risen 52.5% year to date. The Zacks Consensus Estimate for Tutor Perini’s 2025 sales and earnings per share (EPS) implies an increase of 17.3% and 158.8%, respectively, from a year ago.

Construction Partners, Inc. ROAD currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter earnings surprise of 97.4%, on average. The stock has trended up 20.9% year to date.

The Zacks Consensus Estimate for Construction Partners’ fiscal 2025 sales and EPS implies an increase of 53% and 60.9%, respectively, from a year ago.

Gibraltar Industries, Inc. ROCK currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter earnings surprise of 3.1%, on average. The stock has inched up 3.1% year to date. 

The Zacks Consensus Estimate for Gibraltar’s 2025 sales and EPS implies an increase of 9.3% and 15.8%, respectively, from a year ago.

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This article originally published on Zacks Investment Research (zacks.com).

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