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Product Demand, Pricing to Aid Martin Marietta (MLM) Q2 Earnings
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Martin Marietta Materials, Inc. (MLM - Free Report) is scheduled to report second-quarter 2023 results on Jul 27, before the opening bell.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 118.2% and revenues topped the same by 14.2%. On a year-over-year basis, earnings of this aggregates producer increased by a whopping 453.8% and revenues rose by 10%.
Martin Marietta’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average surprise being 31%.
The Trend in Estimate Revision
The Zacks Consensus Estimate for Martin Marietta’s second-quarter earnings is pegged at $4.77 per share, suggesting a rise of 20.5% from the year-ago quarter’s reported figure of $3.96.
Martin Marietta Materials, Inc. Price and EPS Surprise
The consensus estimate for net sales is pegged at $1.82 billion, indicating a 19.7% increase from the prior-year quarter’s reported figure of $1.52 billion.
Factors to Note
Martin Marietta’s second-quarter revenues are expected to have improved on the back of strong pricing gains in aggregates, strength in public construction and accretive acquisitions. The company expects solid near-term product demand reinforced by healthy customer backlogs across its coast-to-coast footprint, led by infrastructure and heavy non-residential projects of scale.
MLM’s business has been sensitive to changes in construction spending, particularly housing and public construction in Texas, Colorado, North Carolina, Georgia, Florida, as well as Iowa. Infrastructure construction, particularly for aggregates-intensive highways, roads and streets, might have also contributed to its performance in the quarter, as contractors advanced projects that have been awarded and funded.
Our model suggests Aggregates pricing to increase to $18.54 per ton, marking 13.4% year-over-year growth. We expect Aggregates revenues to increase 12.7% year over year to $1,076.6 million.
The Zacks Consensus Estimates for Aggregates volume is pegged at 58.951 million tons versus 57.8 million reported a year ago.
We expect cement revenues to increase 38.7% year over year to $219 million. Cement pricing is also expected to rise 42.2% to $199.11 per ton.
The Zacks Consensus Estimates for Cement volume is pegged at 1.089 million tons versus 1.1 million reported a year ago.
We expect the Building Material segment revenues, which comprised 93.8% of total revenues in the first quarter, to grow 9.6% year over year to $1,709.9 million.
The Zacks Consensus Estimates for gross profit for the Building Material unit is pegged at $482 million versus $399.1 million reported a year ago.
Our model suggests Magnesia Specialties revenues are likely to increase 10.3% year over year to $90.1 million.
The Zacks Consensus Estimates for gross profit for the Magnesia Specialties unit is pegged at $26.34 million versus $24.5 million reported a year ago.
However, the slowdown in single-family residential construction might have weighed on the quarterly volumes. Also, inflation, higher liquid asphalt and diesel fuel costs, a rise in transportation and insurance costs, as well as labor costs, may have impacted the bottom line in the second quarter. Also, costs related to higher repair and maintenance, supply and contract as well as supply-chain bottlenecks are added concerns.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Martin Marietta this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
Currently, MLM has a Zacks Rank #2 and an Earnings ESP of -0.71%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some other companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
The Zacks Consensus Estimate for Owens Corning’s second-quarter earnings is pegged at $3.25 per share, suggesting a 15.1% fall from the year-ago quarter’s figure of $3.83. Earnings estimates for the said period moved up 10 cents in the past seven days, depicting analysts’ optimism over the company’s growth potential. Its earnings topped the consensus mark in each of the last four quarters, the average being 15.1%.
Boise Cascade Company (BCC - Free Report) has an Earnings ESP of +2.36% and a Zacks Rank #1.
BCC’s earnings for the to-be-reported quarter are expected to decline 53.7%. The company reported better-than-expected earnings in three of the last four quarters and missed on one occasion, the average surprise being 19%.
Installed Building Products, Inc. (IBP - Free Report) has an Earnings ESP of +2.08% and a Zacks Rank #1.
IBP’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average being 9%. Earnings for the to-be-reported quarter are expected to decline 8.1% year over year.
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Product Demand, Pricing to Aid Martin Marietta (MLM) Q2 Earnings
Martin Marietta Materials, Inc. (MLM - Free Report) is scheduled to report second-quarter 2023 results on Jul 27, before the opening bell.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 118.2% and revenues topped the same by 14.2%. On a year-over-year basis, earnings of this aggregates producer increased by a whopping 453.8% and revenues rose by 10%.
Martin Marietta’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average surprise being 31%.
The Trend in Estimate Revision
The Zacks Consensus Estimate for Martin Marietta’s second-quarter earnings is pegged at $4.77 per share, suggesting a rise of 20.5% from the year-ago quarter’s reported figure of $3.96.
Martin Marietta Materials, Inc. Price and EPS Surprise
Martin Marietta Materials, Inc. price-eps-surprise | Martin Marietta Materials, Inc. Quote
The consensus estimate for net sales is pegged at $1.82 billion, indicating a 19.7% increase from the prior-year quarter’s reported figure of $1.52 billion.
Factors to Note
Martin Marietta’s second-quarter revenues are expected to have improved on the back of strong pricing gains in aggregates, strength in public construction and accretive acquisitions. The company expects solid near-term product demand reinforced by healthy customer backlogs across its coast-to-coast footprint, led by infrastructure and heavy non-residential projects of scale.
MLM’s business has been sensitive to changes in construction spending, particularly housing and public construction in Texas, Colorado, North Carolina, Georgia, Florida, as well as Iowa. Infrastructure construction, particularly for aggregates-intensive highways, roads and streets, might have also contributed to its performance in the quarter, as contractors advanced projects that have been awarded and funded.
Our model suggests Aggregates pricing to increase to $18.54 per ton, marking 13.4% year-over-year growth. We expect Aggregates revenues to increase 12.7% year over year to $1,076.6 million.
The Zacks Consensus Estimates for Aggregates volume is pegged at 58.951 million tons versus 57.8 million reported a year ago.
We expect cement revenues to increase 38.7% year over year to $219 million. Cement pricing is also expected to rise 42.2% to $199.11 per ton.
The Zacks Consensus Estimates for Cement volume is pegged at 1.089 million tons versus 1.1 million reported a year ago.
We expect the Building Material segment revenues, which comprised 93.8% of total revenues in the first quarter, to grow 9.6% year over year to $1,709.9 million.
The Zacks Consensus Estimates for gross profit for the Building Material unit is pegged at $482 million versus $399.1 million reported a year ago.
Our model suggests Magnesia Specialties revenues are likely to increase 10.3% year over year to $90.1 million.
The Zacks Consensus Estimates for gross profit for the Magnesia Specialties unit is pegged at $26.34 million versus $24.5 million reported a year ago.
However, the slowdown in single-family residential construction might have weighed on the quarterly volumes. Also, inflation, higher liquid asphalt and diesel fuel costs, a rise in transportation and insurance costs, as well as labor costs, may have impacted the bottom line in the second quarter. Also, costs related to higher repair and maintenance, supply and contract as well as supply-chain bottlenecks are added concerns.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Martin Marietta this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
Currently, MLM has a Zacks Rank #2 and an Earnings ESP of -0.71%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some other companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
Owens Corning (OC - Free Report) has an Earnings ESP of +1.11% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Owens Corning’s second-quarter earnings is pegged at $3.25 per share, suggesting a 15.1% fall from the year-ago quarter’s figure of $3.83. Earnings estimates for the said period moved up 10 cents in the past seven days, depicting analysts’ optimism over the company’s growth potential. Its earnings topped the consensus mark in each of the last four quarters, the average being 15.1%.
Boise Cascade Company (BCC - Free Report) has an Earnings ESP of +2.36% and a Zacks Rank #1.
BCC’s earnings for the to-be-reported quarter are expected to decline 53.7%. The company reported better-than-expected earnings in three of the last four quarters and missed on one occasion, the average surprise being 19%.
Installed Building Products, Inc. (IBP - Free Report) has an Earnings ESP of +2.08% and a Zacks Rank #1.
IBP’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average being 9%. Earnings for the to-be-reported quarter are expected to decline 8.1% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.