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Martin Marietta Materials (MLM)
NYSE:MLM
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Martin Marietta Materials
(NYSE:MLM)63Neutral
Positive Factors
Growth Opportunities
MLM sees targeted opportunities, notably in markets where there has been recent M&A activity, which could be a source of upside.
Investment Opportunity
End market strength, pricing potential, and other key takeaways from NDR bolster our conviction that Aggregates and Martin Marietta remain an attractive and differentiated investment opportunity.
Market Sentiment
Reiterated 2025 Aggregates price outlook of +5.5% to +7.5% growth yoy is expected to support if not bolster sentiment around the stock.
Negative Factors
Earnings Expectations
The 2025 guidance is slightly below expectations, indicating some challenges in meeting market expectations.
Earnings Guidance
MLM's 2025 EBITDA guidance fell short of expectations due to a softer outlook for private, timing of aggs price increase, and margin compression in its downstream business.
Interest Rates
Higher for longer interest rates are putting pressure on construction activities, impacting the organic outlook for private construction.
Martin Marietta Materials (MLM) vs. S&P 500 (SPY)
Market Cap
$28.17B
Dividend Yield0.66%
Average Volume (3M)560.99K
Price to Earnings (P/E)14.3
Beta (1Y)1.24
Revenue Growth-3.56%
EPS Growth70.93%
CountryUS
Employees9,400
SectorBasic Materials
Sector Strength56
IndustryConstruction Materials
Share Statistics
EPS (TTM)32.34
Shares Outstanding60,974,148
10 Day Avg. Volume738,282
30 Day Avg. Volume560,986
Financial Highlights & Ratios
PEG Ratio0.20
Price to Book (P/B)N/A
Price to Sales (P/S)4.31
Price to Cash Flow (P/CF)10.30
P/FCF Ratio14.20
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$617.19Price Target Upside29.69% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering13
Martin Marietta Materials Business Overview & Revenue Model
Company DescriptionMartin Marietta Materials (MLM) is a leading supplier of building materials, primarily serving the construction industry. The company specializes in producing aggregates, such as crushed stone, sand, and gravel, which are essential components for infrastructure and commercial construction projects. Additionally, Martin Marietta provides cement, ready-mixed concrete, and asphalt, offering a comprehensive suite of materials for various construction needs. Operating across the United States, the company plays a vital role in supporting large-scale infrastructure projects and urban development.
How the Company Makes MoneyMartin Marietta Materials generates revenue primarily through the sale of construction aggregates, which include crushed stone, sand, and gravel. These materials are essential for building roads, bridges, and other infrastructure projects. The company also earns income from producing and selling cement, ready-mixed concrete, and asphalt, which are critical for both residential and commercial construction. Key revenue streams include contracts with government entities for public infrastructure projects, as well as sales to private construction firms. Strategic acquisitions and partnerships have enabled Martin Marietta to expand its market presence and access new geographic regions, further bolstering its revenue potential. Additionally, the company's vertically integrated business model, encompassing production, distribution, and sales, helps optimize operational efficiencies and cost management, contributing to its profitability.
Martin Marietta Materials Financial Statement Overview
Summary
Martin Marietta Materials shows stable revenue growth with recent profitability challenges. The balance sheet is robust with moderate leverage, and cash flow management is solid, though free cash flow consistency needs improvement.Income Statement
The company's revenue growth has been generally positive, with an overall increasing trend over the years. However, the latest year shows a decline in total revenue. Gross profit margins have been relatively stable, but the net profit margin exhibits volatility, particularly with a notable rise in the recent year. This volatility is also reflected in the EBIT and EBITDA margins, which saw a significant decline recently. Overall, the company shows a stable revenue base with profitability challenges in the most recent year.60
Neutral
Balance Sheet
Martin Marietta Materials maintains a healthy balance sheet with a strong equity base, indicated by a high equity ratio. The debt-to-equity ratio is moderate, suggesting a balanced approach to leveraging. The return on equity is strong, reflecting effective utilization of shareholders' investments, although there is room for improvement. The company's financial position is stable, with a solid asset base and prudent financial management.75
Positive
Cash Flow
The company has shown a positive trend in operating cash flow, though there is a slight decline in recent free cash flow. Free cash flow growth has been inconsistent, and the operating cash flow to net income ratio is strong, indicating effective cash conversion. However, the capital expenditures have increased, impacting free cash flow. Overall, the company's cash flow management is solid but could benefit from improved free cash flow consistency.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 6.54B | 6.78B | 6.16B | 5.41B | 4.73B | Gross Profit |
| 1.88B | 2.02B | 1.42B | 1.35B | 1.25B | EBIT |
| 2.71B | 1.60B | 1.21B | 973.80M | 1.01B | EBITDA |
| 3.34B | 2.17B | 1.59B | 1.46B | 1.42B | Net Income Common Stockholders |
| 2.00B | 1.17B | 866.80M | 702.50M | 721.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 670.00M | 1.27B | 358.00M | 258.40M | 207.30M | Total Assets |
| 18.17B | 15.12B | 14.99B | 14.39B | 10.58B | Total Debt |
| 5.80B | 4.92B | 5.04B | 5.10B | 2.63B | Net Debt |
| 5.13B | 3.65B | 4.68B | 4.84B | 2.42B | Total Liabilities |
| 8.71B | 7.09B | 7.82B | 7.86B | 4.69B | Stockholders Equity |
| 9.45B | 8.03B | 7.17B | 6.54B | 5.89B |
| Cash Flow | Free Cash Flow | |||
| 604.00M | 878.10M | 509.40M | 714.60M | 690.40M | Operating Cash Flow |
| 1.46B | 1.53B | 991.20M | 1.14B | 1.05B | Investing Cash Flow |
| -2.44B | 458.70M | -483.80M | -3.47B | -409.70M | Financing Cash Flow |
| 373.00M | -1.06B | -407.50M | 2.29B | -357.00M |
Martin Marietta Materials Technical Analysis
Negative
475.91
Price Trends
520.92
Negative
549.16
Negative
546.15
Negative
Market Momentum
-16.84
Positive
34.64
Neutral
20.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MLM, the sentiment is Negative. The current price of 475.91 is below the 20-day moving average (MA) of 507.18, below the 50-day MA of 520.92, and below the 200-day MA of 546.15, indicating a bearish trend. The MACD of -16.84 indicates Positive momentum. The RSI at 34.64 is Neutral, neither overbought nor oversold. The STOCH value of 20.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MLM.
Martin Marietta Materials Risk Analysis
Martin Marietta Materials disclosed 37 risk factors in its most recent earnings report. Martin Marietta Materials reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Martin Marietta 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% | 0.78% | -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% | 0.66% | -3.56% | 70.93% | |
59 Neutral | $9.19B | 9.58 | 8.39% | 1.04% | -0.45% | -1.48% | |
47 Neutral | $2.64B | -4.00 | -31.55% | 3.33% | 2.93% | -29.90% |
* Basic Materials Sector Average
Performance Comparison
MLM
Martin Marietta Materials
475.91
-132.50
-21.78%
CX
Cemex SAB
6.36
-1.46
-18.67%
EXP
Eagle Materials
220.79
-37.77
-14.61%
VMC
Vulcan Materials
235.17
-34.55
-12.81%
CRH
CRH plc
98.78
17.54
21.59%
Martin Marietta Materials Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: -9.89% | Next Earnings Date: May 6, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view with significant achievements in financial performance and strategic transactions, but also highlighted challenges in revenue decrease and margin compression in certain segments. The overall sentiment is cautiously optimistic with a positive outlook on infrastructure demand and strategic growth opportunities.Highlights
Record Financial Performance
Martin Marietta Materials delivered record aggregates financial performance, including a record fourth quarter consolidated gross profit of $489 million and an adjusted EBITDA of $545 million, reflecting an 8% increase.
Successful Portfolio Transactions
Completed nearly $6 billion of portfolio-enhancing transactions, including $4 billion of aggregate acquisitions and over $2 billion in non-core asset divestitures.
Strong Safety Performance
Achieved best full-year safety incident rates in the company's history, marking the eighth consecutive year of a world-class lost time incident rate.
Positive Outlook for Infrastructure
Strong infrastructure demand expected with increased investments from the Infrastructure and Investment in Jobs Act, anticipating a robust multi-year period for public highway and bridge construction.
Magnesia Specialties Growth
Magnesia Specialties established all-time records with revenues increasing 2% to $320 million and gross profit rising 10% to $107 million.
Lowlights
Decrease in Building Materials Revenue
Full-year revenues decreased 4% to $6.2 billion and gross profit decreased by 6%, primarily due to divestitures and shipment declines across product lines.
Cement and Concrete Revenue Decline
Revenues decreased 29% to $1.1 billion and gross profit decreased by 40% due to divestitures and higher input costs.
Ready-Mix Margin Compression
Ready-Mix concrete operations faced margin compression due to higher input costs outpacing pricing growth.
Company Guidance
During the fourth quarter of 2024, Martin Marietta Materials, Inc. reported robust financial performance, with record consolidated gross profit of $489 million and a consolidated adjusted EBITDA of $545 million, reflecting an 8% increase. The EBITDA margin improved by 210 basis points to 33%. Aggregates gross profit per ton reached $7.92, marking a 12% increase, and the aggregates gross margin improved by 120 basis points to 33%. The company completed three strategic acquisitions in Southwest Florida, Southern California, and West Texas, enhancing its portfolio in high-growth areas. Despite challenges such as inclement weather and a slowdown in private construction, the company managed to increase full-year aggregates revenues and gross profit by 5%, while Magnesia Specialties revenues rose by 2% to $320 million and gross profit by 10% to $107 million. Safety performance also reached historic highs, with the best full-year safety incident rates recorded. The company anticipates continued growth in 2025, driven by a 4% increase in aggregate shipments and a 6.5% pricing growth, supported by strong infrastructure demand and contributions from recent acquisitions.Martin Marietta Materials Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Martin Marietta Reports Record Q4 2024 Profits
Positive
Feb 12, 2025
Martin Marietta announced its financial results for the fourth quarter and full year of 2024, highlighting a return to earnings growth and margin expansion despite challenges like inclement weather and softening construction demand. The company achieved record fourth-quarter profits and nearly double-digit growth in unit margins, supported by approximately $6 billion in acquisitions and divestitures that optimized its portfolio and improved its margin profile. The strategic actions taken in 2024 are expected to offset softness in residential construction and support continued earnings growth into 2025.
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.