Capstone adds $11 Million in Revenue with Carolina Stone Acquisition - Drives Immediate Accretion and Southeast Expansion
Rhea-AI Summary
Capstone Holding Corp. (NASDAQ:CAPS) has completed its acquisition of Carolina Stone Products ahead of schedule for $3.9-$4.7 million, representing a 4.7×-5.2× EBITDA multiple. The acquisition adds $11 million in revenue and approximately $0.75 million in EBITDA to Capstone's portfolio.
The strategic acquisition strengthens Capstone's Southeast presence and premium brand portfolio, positioning the company for a $100 million revenue run-rate entering 2026. The deal aligns with Capstone's disciplined M&A strategy targeting 4-6× EBITDA multiples with 20-45% non-cash consideration.
The company's recent acquisitions have shown positive results, with Q2 gross margins increasing to 24.4% from 21.4% year-over-year. Capstone expects to close at least one more acquisition by year-end 2025.
Positive
- Immediately accretive acquisition adding $11 million in revenue and $0.75 million in EBITDA
- Strategic expansion into high-growth Southeast construction markets
- Q2 gross margins improved significantly to 24.4% from 21.4% YoY
- Disciplined acquisition at 4.7×-5.2× EBITDA multiple, within target range
- Company on track for $100 million revenue run-rate entering 2026
- Additional acquisition expected by year-end 2025
Negative
- Significant portion of purchase price (20-45%) paid in non-cash consideration, potentially diluting existing shareholders
News Market Reaction – CAPS
On the day this news was published, CAPS gained 55.45%, reflecting a significant positive market reaction. Argus tracked a peak move of +69.6% during that session. Argus tracked a trough of -3.2% from its starting point during tracking. Our momentum scanner triggered 33 alerts that day, indicating elevated trading interest and price volatility. This price movement added approximately $3M to the company's valuation, bringing the market cap to $10M at that time. Trading volume was exceptionally heavy at 744.2x the daily average, suggesting very strong buying interest.
Data tracked by StockTitan Argus on the day of publication.
Deal delivered at target 4-6× EBITDA range; strengthens platform with premium brands in high-growth construction market
NEW YORK CITY, NY / ACCESS Newswire / August 25, 2025 / Capstone Holding Corp. (NASDAQ:CAPS), a national building products distribution platform, today announced the closing of its previously announced acquisition of Carolina Stone Products ahead of schedule.
Transaction Highlights
Closing Date: August 22, 2025
Target: Carolina Stone Products (North Carolina)
Financials (Trailing): Revenue ≈
$11 million ; LTM EBITDA ≈$0.75 million / 2026 ≈ 1.001 millionPurchase Price & Multiple:
$3.9 -$4.7 million (~4.7×-5.2× EBITDA)Accretion: Immediately accretive to revenue and EBITDA at close
Strategic fit: Expands Southeast footprint; adds premium brands; supports margin expansion
"With Friday's closing, we're delivering exactly what we said we would: immediately accretive acquisitions at disciplined valuations," said Matthew Lipman, CEO. "Carolina Stone strengthens our brand portfolio, gives us a foothold in one of the nation's fastest-growing construction markets, and positions us for a ~
Stuart Powell, EVP of Carolina Stone Products, added: "We're excited to officially join Capstone. The expanded reach and access to Instone's distribution platform will allow us to better serve our customers and accelerate growth."
Capstone's Active M&A Pipeline
In building products distribution, scale delivers clear advantages, including pricing power, operational leverage, and broader reach. Capstone is achieving that scale with discipline, targeting acquisitions at 4-6× EBITDA with 20
Capstone expects to close at least one more acquisition by year-end 2025. This disciplined M&A strategy continues to drive immediate accretion, creating long-term value for shareholders.
Achieving Platform Growth
The closing of Carolina Stone adds to a series of successful acquisitions - including HHT's stone business, Heller's Stone, and Northeast Masonry - that have expanded Capstone's footprint, lowered costs, and improved service.
The impact is evident in Capstone's Q2 results: gross margins rose to
About Capstone Holding Corp.
Capstone Holding Corp. (NASDAQ: CAPS) is a diversified platform of building products businesses focused on distribution, brand ownership, and acquisition. Through its Instone subsidiary, Capstone serves 31 U.S. states, offering proprietary stone veneer, hardscape materials, and modular masonry systems. The company's strategy combines disciplined M&A, operational efficiency, and a growing portfolio of owned brands to build a scalable and durable platform.
Investor Contact
Investor Relations
Capstone Holding Corp.
investors@capstoneholdingcorp.com
www.capstoneholdingcorp.com
Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These statements relate to future events and performance, including guidance regarding revenue and EBITDA targets, M&A strategy, use of capital, and operating outlook. Actual results may differ materially from those projected due to a range of factors, including but not limited to acquisition timing, macroeconomic conditions, and execution risks. Please review the Company's filings with the SEC for a full discussion of risk factors. Capstone undertakes no obligation to revise forward-looking statements except as required by law.
SOURCE: Capstone Holding Corp.
View the original press release on ACCESS Newswire
FAQ
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