Headquartered in Birmingham, Alabama, Vulcan Materials Company (VMC) is the largest producer of construction aggregates in the U.S., with a market cap of $31.79 billion. Specializing in the production of crushed stone, sand, and gravel, Vulcan plays a crucial role in supporting infrastructure development and construction projects nationwide.
Shares of VMC have underperformed the broader market considerably over the past year. VMC has gained 11.9% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 27.7%. Also, in 2024, the stock is up 5.9%, compared to SPX’s 18% rise on a YTD basis.
Narrowing the focus, VMC's underperformance is evident when measured against the Invesco Building & Construction ETF (PKB). The exchange-traded fund has gained 16.8% on a YTD basis.
On Aug.6, Vulcan Materials fell over 4% after reporting Q2 adjusted EBITDA of $603 million, missing the consensus estimate of $615 million. The company also lowered its full-year adjusted EBITDA forecast to a range of $1.00 billion to $2.15 billion, down from the previous projection of $2.15 billion-$2.30 billion, which was below the consensus of $2.19 billion.
For the current fiscal year, ending in December, analysts expect VMC’s EPS to grow 12.9% year over year to $7.90 on a diluted basis. The company's earnings surprise history is mixed. It missed the consensus estimate in three of the last four quarters while beating the forecast on another occasion.
Among the 19 analysts covering VMC stock, the consensus rating is a “Moderate Buy.” That’s based on 12 “Strong Buy” ratings, one “Moderate Buy,” and six “Holds.”
On Aug. 27, Barclays analyst Adam Seiden maintained a “Buy” rating on Vulcan Materials, with a price target of $250, which indicates a 4% upside from the current levels.
The mean price target of $277.47 represents a 15.4% premium compared to VMC’s current price levels. The Street-high price target of $310 suggests an upside potential of 28.9%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
