Seven HOT building material stocks: Are they worth your penny?

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 Seven HOT building material stocks: Are they worth your penny?
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Highlights

  • Vulcan Materials Company (NYSE: VMC) stock grew 6.7% MTD and 36.8% YTD.

  • Martin Marietta Materials, Inc. (NYSE: MLM) stock rose 7.4% MTD and 48.6% YTD. Martin Marietta has a P/E ratio of 36.22 and a dividend yield of 0.58%.

  • Summit Materials, Inc. (NYSE: SUM) stock rose 15.6% MTD and 105.2% YTD.

President Joe Biden has signed a US$1.2-trillion bipartisan infrastructure bill into law on Monday. The infrastructure stocks are set to receive a major boost from the legislation.

The law provides US$550 billion in new investment for transportation, utilities, and communication and other key sectors.

The government is expected to build or overhaul bridges, public transit systems, airports, and waterways. It also provides for US$7.5 billion for building the EV infrastructure. 

Here, we discuss seven construction material stocks that have moved up month-to-date.

Vulcan Materials Company (NYSE: VMC)

The Birmingham, Alabama-based VMC produces construction aggregates like sand, crushed stone, gravel, etc. The stock grew 6.7% MTD and 36.8% YTD.

Analysts expect a one-year target price of US$202 for the stock. It traded in the range of US$210.16 to US$134.53 in the last 52 weeks.

For the September quarter of 2021, its revenue was US$1.5 billion and net income was US$177 million. The cash and equivalents stood at US$136 million at the end of the quarter.

Its dividend yield is 0.73%, with an annualized dividend of US$1.48. The stock has a P/E ratio of 41.93 and a forward P/E for one year of 40.67. Its market capitalization is US$26.9 billion.

The stock closed at US$202.95 on Tuesday.

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Top construction material stocks to explore. 

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Martin Marietta Materials, Inc. (NYSE: MLM)

Martin Marietta is a construction material producer in the US. It is headquartered in Raleigh, North Carolina. Its stock rose 7.4% MTD and 48.6% YTD.

Analysts have set a one-year target price for the stock at US$442.50. The stock witnessed the highest and lowest price of US$435.62 and US$258.18, respectively, in the last 52 weeks.

Its revenue was US$1.56 billion and net income was US$255 billion in the September quarter. The company declared a quarterly cash dividend of US$0.61 per share, payable on Dec 31, 2021. The ex-dividend date is Nov 30.

MLM’s market cap is US$26.22 billion. The P/E and forward P/E for one year are 36.22 and 35.31, respectively. MLM has paid an annualized dividend of US$2.44 with a dividend yield of 0.58%. The stock closed at US$421.95 on Nov 16.

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Smith-Midland Corporation (NASDAQ: SMID)

The Midland, Virginia-based company manufactures precast concrete products used in construction, farming, and utilities. Its stock rose 22.6% MTD and 166.8% YTD.

In the third quarter of 2021, its EPS rose by 137% YoY and product sales grew by 11% YoY. The revenue and net income were US$13.1 million and US$3.69 million, respectively.

Its market cap is US$127 million, and the P/E ratio is 15.44. The stock’s 52-week highest price was US$25.90 and the and the lowest was US$7.80. It closed at US$24.52 on Nov 16.

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Summit Materials, Inc. (NYSE: SUM)

The Denver, Colorado-based building company is a construction aggregate supplier and cement producer. Its products include asphalt, paving, and ready-mix concrete. 

The SUM stock rose 15.6% MTD and 105.2% YTD.

The stock traded in the range of US$41.46 and US$17.61 in the last 52 weeks. Analysts pegged its one-year price target at US$40.0.

For the quarter ended Oct 2, 2021, its revenue and net income were US$717 million and 74 million, respectively. It has reported cash and equivalents of US$258 million at the end of the quarter. SUM has a current market capitalization of US$4.9 billion and a P/E ratio of 33.78. the stock closed at US$41.21 on Nov 16, 2021.

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Forterra, Inc. (NASDAQ: FRTA)

The company manufactures concrete pipes and precast products. It has three reportable segments: Drainage Pipe & Products, Water Pipe & Products, and Corporate & Other. 

The FRTA stock surged 0.2% MTD and 38.8% YTD. It reported revenue of US$526 million and net income of US$35.8 million in the quarter ended September 30, 2021.  

The FRTA is headquartered in Irving, Texas. Its P/E ratio is 14.62, and its EPS is US$1.63.

Forterra has a market capitalization of US$1.6 billion. The stock traded in the range of US$23.95 to US$14.90 in the last 52 weeks and closed at US$23.86 on Nov 16, 2021.

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United States Lime & Minerals, Inc. (NASDAQ: USLM)

The Dallas, Texas-based company manufactures lime and limestone products, like PLS and lime slurry, used in buildings, highways, roads and glass manufacturing, water and flue gas treatment facilities, agriculture, etc. 

The USLM stock grew 12.2% MTD and 21.6% YTD.

The stock price touched the highest of US$156.00 and the lowest of US$95.30, in the last 52 weeks. It posted revenue and net income of US$52 million and US$11 million, respectively, for the September quarter of 2021. It has a market capitalization of US$784 million, with a PE ratio of 21.42. USLM’s pays an annualized dividend of US$0.64 with a dividend yield of 0.46%.

The stock closed at US$138.58 on Nov 16.

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(Construction Material Stocks)

Source – Pixabay

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Eagle Materials Inc (NYSE: EXP)

The company is headquartered in Dallas, Texas. Its products include cement, concrete, gypsum wallboard, recycled paperboard, etc., used in the construction industry.

Its stock increased 9.4% MTD and 60.1% YTD.

Analysts’ one-year target price for the stock is US$172.00. It traded in the range of US$165.69 and US$87.95 in the last 52 weeks.

For the September quarter, the company earned revenue and net income of US$510 million and US$102 million, respectively. Its next dividend payment date is on Jan 14, 2022, for US$0.25 per share, for shareholders of record on Dec 17, 2021. 

Its market capitalization is US$6.6 billion, the P/E ratio is 19.76, and the dividend yield is 0.62%, with an annualized dividend of US$US$1.00.

The closing price of the stock is US$US$162.24.

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Bottomline

Besides the infrastructure sector, capital goods, energy, technology, and EV, among others, are expected to benefit from the law immensely. However, investors must analyze the company fundamentals and the external factors before investing in stocks.

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