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Eagle Materials Inc (EXP)
NYSE:EXP
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Eagle Materials
(NYSE:EXP)66Neutral
Positive Factors
Pricing Strategy
There are increasingly attractive pricing dynamics in wallboard given structural declines in synthetic gypsum supply amid coal plant retirements.
Production Efficiency
Eagle Materials has a sustainable position as a low-cost producer given ownership of raw material supply.
Negative Factors
Natural Gas Prices
There are some near-term risks due to a cold winter raising natural gas pricing and potential impacts on volume this quarter.
Eagle Materials (EXP) vs. S&P 500 (SPY)
Market Cap
$7.16B
Dividend Yield0.47%
Average Volume (3M)375.25K
Price to Earnings (P/E)15.4
Beta (1Y)1.85
Revenue Growth0.64%
EPS Growth-1.15%
CountryUS
Employees2,500
SectorBasic Materials
Sector Strength56
IndustryConstruction Materials
Share Statistics
EPS (TTM)13.99
Shares Outstanding33,287,643
10 Day Avg. Volume384,867
30 Day Avg. Volume375,255
Financial Highlights & Ratios
PEG Ratio4.94
Price to Book (P/B)N/A
Price to Sales (P/S)3.24
Price to Cash Flow (P/CF)15.30
P/FCF Ratio14.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$275.20Price Target Upside24.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Eagle Materials Business Overview & Revenue Model
Company DescriptionEagle Materials Inc. is a leading provider of building materials serving the construction and infrastructure markets. The company operates in two primary sectors: Heavy Materials and Light Materials. In the Heavy Materials sector, Eagle Materials produces and supplies cement, concrete, and aggregates, while in the Light Materials sector, it manufactures gypsum wallboard and recycled paperboard. With a focus on high-quality production and customer service, the company plays a crucial role in supporting building projects across the United States.
How the Company Makes MoneyEagle Materials Inc. generates revenue primarily through the sale of its building materials products. In the Heavy Materials sector, revenue is derived from the production and sale of cement, concrete, and aggregates to construction and infrastructure projects. The Light Materials sector contributes to the company's earnings through the manufacture and sale of gypsum wallboard and recycled paperboard, which are essential components in residential and commercial construction. The company's revenue streams are bolstered by strategic partnerships with construction firms and infrastructure developers, as well as a strong distribution network that ensures product availability across various regions. Additionally, Eagle Materials benefits from long-term supply agreements and contracts that provide a stable income base.
Eagle Materials Financial Statement Overview
Summary
Eagle Materials exhibits a solid financial position with strong revenue and profit growth, robust cash flow generation, and a stable balance sheet. While profitability and cash flow metrics are commendable, careful management of leverage and operational expenses is advisable to maintain financial health.Income Statement
Eagle Materials shows strong revenue growth with a significant increase from previous years. The gross profit margin is healthy, indicating efficient production and cost management. Net profit margin and EBIT margin are both robust, reflecting strong profitability and operational efficiency. Revenue growth rate is impressive, suggesting an upward trajectory. However, a slight decline in EBIT margin from the previous annual report suggests monitoring of operational expenses is necessary.88
Very Positive
Balance Sheet
The company's balance sheet reveals a solid equity base, with a decent equity ratio that suggests financial stability. However, the debt-to-equity ratio is moderately high, indicating reliance on debt financing. Return on equity is strong, reflecting effective use of shareholders' capital. Overall, the balance sheet is stable but suggests a need to manage leverage cautiously.75
Positive
Cash Flow
Eagle Materials demonstrates strong operating cash flow relative to net income, indicating good cash generation capability. The free cash flow to net income ratio is also favorable, suggesting efficient capital expenditure management. However, the free cash flow growth rate has slightly decreased, which could imply potential challenges in future cash flow improvements.80
Positive
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 2.27B | 2.26B | 2.15B | 1.86B | 1.62B | 1.45B | Gross Profit |
| 688.21M | 685.32M | 639.27M | 519.61M | 408.36M | 331.26M | EBIT |
| 460.91M | 625.53M | 485.21M | 514.41M | 287.47M | 194.89M | EBITDA |
| 788.82M | 811.07M | 724.19M | 601.62M | 597.68M | 407.67M | Net Income Common Stockholders |
| 474.04M | 477.64M | 461.54M | 374.25M | 339.44M | 70.89M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 34.92M | 34.92M | 15.24M | 19.42M | 263.52M | 118.65M | Total Assets |
| 2.98B | 2.95B | 2.78B | 2.58B | 2.84B | 2.96B | Total Debt |
| 1.12B | 1.12B | 1.10B | 974.60M | 1.01B | 1.63B | Net Debt |
| 1.09B | 1.09B | 1.08B | 955.18M | 751.44M | 1.51B | Total Liabilities |
| 1.67B | 1.64B | 1.60B | 1.45B | 1.48B | 1.99B | Stockholders Equity |
| 1.31B | 1.31B | 1.19B | 1.13B | 1.36B | 967.84M |
| Cash Flow | Free Cash Flow | ||||
| 369.74M | 443.63M | 431.58M | 443.05M | 589.14M | 267.18M | Operating Cash Flow |
| 549.17M | 563.94M | 541.73M | 517.17M | 643.07M | 399.30M | Investing Cash Flow |
| -204.31M | -175.36M | -268.59M | -74.12M | 37.09M | -831.08M | Financing Cash Flow |
| -362.60M | -368.90M | -277.31M | -692.15M | -530.29M | 541.83M |
Eagle Materials Technical Analysis
Negative
220.79
Price Trends
245.16
Negative
269.73
Negative
257.81
Negative
Market Momentum
-9.43
Positive
33.09
Neutral
40.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXP, the sentiment is Negative. The current price of 220.79 is below the 20-day moving average (MA) of 236.65, below the 50-day MA of 245.16, and below the 200-day MA of 257.81, indicating a bearish trend. The MACD of -9.43 indicates Positive momentum. The RSI at 33.09 is Neutral, neither overbought nor oversold. The STOCH value of 40.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EXP.
Eagle Materials Risk Analysis
Eagle Materials disclosed 15 risk factors in its most recent earnings report. Eagle Materials reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Eagle Materials Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | £65.15B | 19.20 | 16.07% | 1.84% | 1.78% | 15.53% | |
72 Outperform | $31.03B | 34.28 | 11.79% | 0.77% | -4.68% | -1.73% | |
66 Neutral | $7.16B | 15.37 | 33.51% | 0.47% | 0.64% | -1.15% | |
63 Neutral | $28.17B | 14.26 | 22.83% | 0.64% | -3.56% | 70.93% | |
59 Neutral | $9.19B | 9.58 | 8.39% | 0.99% | -0.45% | -1.48% | |
47 Neutral | $2.64B | -4.00 | -31.55% | 3.33% | 2.93% | -29.90% |
* Basic Materials Sector Average
Performance Comparison
EXP
Eagle Materials
220.79
-37.77
-14.61%
CX
Cemex SAB
6.36
-1.46
-18.67%
MLM
Martin Marietta Materials
475.91
-132.50
-21.78%
VMC
Vulcan Materials
235.17
-34.55
-12.81%
CRH
CRH plc
98.78
17.54
21.59%
Eagle Materials Earnings Call Summary
Earnings Call Date: Jan 29, 2025 | % Change Since: -14.54% | Next Earnings Date: May 15, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted record revenue and strong cash flow, driven by strategic initiatives and environmental achievements. However, challenges in the Heavy Materials sector due to weather, project delays, and increased maintenance costs were significant concerns.Highlights
Record Revenue and Increased Cash Flow
In the fiscal second quarter of 2025, Eagle Materials achieved record revenue of $624 million and increased cash flow from operations by 35%.
Environmental and Sustainability Initiatives
Commissioning of the Texas Lehigh slag grinding facility in Houston and a 40% reduction in water usage at the Republic Paperboard facility were notable achievements in sustainability.
Wallboard Segment Performance
Revenue in the Light Materials sector increased by 5%, driven by higher Wallboard sales volume and a 1% increase in Wallboard sales prices.
Strong Financial Flexibility
Net debt-to-EBITDA leverage ratio was 1.2x, with substantial financial flexibility and a strong cash position of $94 million.
Lowlights
Decline in Heavy Materials Sector
Revenue in the Heavy Materials sector declined 2%, driven by lower cement sales volume and higher maintenance costs.
Impact of Weather and Project Delays
Heavy materials volumes were affected by weather and project delays, with a noted impact in markets like Denver and Kansas City.
Increased Maintenance Costs
Upcoming quarter to face $6 million to $8 million in additional maintenance costs due to projects at Texas Lehigh and Tulsa Cement facilities.
Company Guidance
During Eagle Materials' second quarter fiscal 2025 earnings call, guidance focused on several key metrics and strategic initiatives. The company reported record revenue of $624 million, marking a significant increase driven by higher cement and wallboard sales prices, though offset by lower cement volumes. Cash flow from operations surged by 35%, highlighting robust financial management. Earnings per share held steady at $4.26, aided by a 5% reduction in diluted shares through a share buyback program. Noteworthy operational updates included commissioning the Texas Lehigh slag grinding facility, capable of producing over 500,000 tons of low-carbon intensity slag, and a 40% reduction in water usage at the Republic Paperboard facility. Eagle Materials also addressed challenges such as a 5% decline in heavy materials volume, largely due to demand reductions in Denver and a resolved work stoppage in Kansas City. Looking ahead, the company anticipates further maintenance costs in the upcoming quarter due to planned outages at Texas Lehigh and Tulsa Cement facilities. Despite industry forecasts predicting a decline in cement volumes, Eagle remains optimistic about demand recovery, buoyed by the $1 trillion Federal infrastructure bill and favorable construction trends, prompting a planned price increase for early January 2025.Eagle Materials Corporate Events
M&A TransactionsBusiness Operations and Strategy
Eagle Materials Expands with Bullskin Stone Acquisition
Positive
Dec 10, 2024
Eagle Materials Inc. has announced a definitive agreement to acquire Bullskin Stone & Lime, LLC, a pure-play aggregates business based in Western Pennsylvania, for $152.5 million. This acquisition aligns with Eagle’s growth strategy by expanding its network of aggregates quarries and cement plants, enhancing its presence in the Pittsburgh and Western Pennsylvania markets.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.