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Martin Marietta (MLM) Buys AFS, Boosts Aggregates Platform
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Martin Marietta Materials, Inc. (MLM - Free Report) has successfully acquired Albert Frei & Sons, Inc. (“AFS”), a prominent aggregates producer in Colorado. The deal, sealed on Jan 12, 2024, brings over six decades of high-quality hard rock reserves, fortifying Martin Marietta’s position in the high-growth Denver metropolitan area.
This strategic move aligns seamlessly with Martin Marietta’s vision, enhancing its aggregates platform and reinforcing its commitment to delivering substantial value to both shareholders and customers. The company anticipates immediate accretion to earnings, margins, and cash flow, leveraging proceeds from prior divestitures.
With AFS now under its umbrella, Martin Marietta is poised to capitalize on the burgeoning demand for construction materials in the region. The acquisition not only bolsters the company’s market presence but also optimizes operational efficiency, ensuring a seamless and robust supply chain.
Martin Marietta’s proactive approach to aligning acquisitions with its long-term strategy positions the company for sustained success. The infusion of AFS's substantial reserves underscores MLM's dedication to meeting the evolving needs of its customer base while concurrently enhancing shareholder value.
Acquisitions: A Growth Driver
This acquisition marks a pivotal moment in the company's growth trajectory. With a strengthened aggregates platform and increased operational agility, Martin Marietta is poised to rock the market and deliver enduring value for all stakeholders.
Barring this latest AFS buyout, the company did not acquire any businesses in the past year or the first nine months of 2023. However, it has ample flexibility to continue investing in the business and pursuing accretive acquisition opportunities in the future. Overall, these portfolio optimization moves are aimed at bolstering the strength of the business through economic cycles and enhancing the margin profile. Meanwhile, the company has been reviewing its overall portfolio for opportunities to maximize value by monetizing or exchanging select assets. The proceeds from these divestitures are expected to enhance capital allocation priorities, facilitating higher-return, external and organic growth investments to further enhance shareholder value.
Share Price Performance
Shares of this leading supplier of construction aggregates in the United States have gained 40.5% in the past year compared with the Zacks Building Products - Concrete and Aggregates industry’s 33.4% growth. Martin Marietta Materials is benefiting from its strong presence in public construction and value-accretive acquisitions. The company places a significant focus on its long-term strategic plans, particularly the positive outlook for the SOAR (Strategic Operating Analysis and Review) 2025 initiatives, signaling promising prospects ahead.
Image Source: Zacks Investment Research
The Zacks Rank #1 (Strong Buy) company’s 2024 earnings and sales are likely to witness growth of 13.1% and 9.2% year over year, respectively. Earnings estimates for 2024 have increased upward to $21.05 per share from $20.86 over the past 60 days. This positive trend signifies bullish analysts’ sentiments, indicating robust fundamentals and the expectation of outperformance in the near term.
Other Key Picks
Some other top-ranked stocks from the Zacks Construction sector are:
Armstrong World Industries, Inc. (AWI - Free Report) currently carries a Zacks Rank of 2 (Buy). AWI delivered a trailing four-quarter earnings surprise of 7.9%, on average. The stock has rallied 32.1% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for AWI’s 2024 sales and EPS indicates growth of 1.3% and 6.8%, respectively, from the previous year’s levels.
TopBuild Corp. (BLD - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter earnings surprise of 14.3%, on average. Shares of BLD have surged 97.8% in the past year.
The Zacks Consensus Estimate for BLD’s 2024 sales and EPS indicates an increase of 7.1% and 4.9%, respectively, from the year-ago period’s levels.
NVR, Inc. (NVR - Free Report) currently carries a Zacks Rank of 2. NVR delivered a trailing four-quarter earnings surprise of 14.6%, on average. The stock has gained 43.5% in the past year.
The Zacks Consensus Estimate for NVR’s 2024 sales and EPS indicates a decline of 3.7% and 10.2%, respectively, from the prior-year levels.
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Martin Marietta (MLM) Buys AFS, Boosts Aggregates Platform
Martin Marietta Materials, Inc. (MLM - Free Report) has successfully acquired Albert Frei & Sons, Inc. (“AFS”), a prominent aggregates producer in Colorado. The deal, sealed on Jan 12, 2024, brings over six decades of high-quality hard rock reserves, fortifying Martin Marietta’s position in the high-growth Denver metropolitan area.
This strategic move aligns seamlessly with Martin Marietta’s vision, enhancing its aggregates platform and reinforcing its commitment to delivering substantial value to both shareholders and customers. The company anticipates immediate accretion to earnings, margins, and cash flow, leveraging proceeds from prior divestitures.
With AFS now under its umbrella, Martin Marietta is poised to capitalize on the burgeoning demand for construction materials in the region. The acquisition not only bolsters the company’s market presence but also optimizes operational efficiency, ensuring a seamless and robust supply chain.
Martin Marietta’s proactive approach to aligning acquisitions with its long-term strategy positions the company for sustained success. The infusion of AFS's substantial reserves underscores MLM's dedication to meeting the evolving needs of its customer base while concurrently enhancing shareholder value.
Acquisitions: A Growth Driver
This acquisition marks a pivotal moment in the company's growth trajectory. With a strengthened aggregates platform and increased operational agility, Martin Marietta is poised to rock the market and deliver enduring value for all stakeholders.
Barring this latest AFS buyout, the company did not acquire any businesses in the past year or the first nine months of 2023. However, it has ample flexibility to continue investing in the business and pursuing accretive acquisition opportunities in the future. Overall, these portfolio optimization moves are aimed at bolstering the strength of the business through economic cycles and enhancing the margin profile. Meanwhile, the company has been reviewing its overall portfolio for opportunities to maximize value by monetizing or exchanging select assets. The proceeds from these divestitures are expected to enhance capital allocation priorities, facilitating higher-return, external and organic growth investments to further enhance shareholder value.
Share Price Performance
Shares of this leading supplier of construction aggregates in the United States have gained 40.5% in the past year compared with the Zacks Building Products - Concrete and Aggregates industry’s 33.4% growth. Martin Marietta Materials is benefiting from its strong presence in public construction and value-accretive acquisitions. The company places a significant focus on its long-term strategic plans, particularly the positive outlook for the SOAR (Strategic Operating Analysis and Review) 2025 initiatives, signaling promising prospects ahead.
Image Source: Zacks Investment Research
The Zacks Rank #1 (Strong Buy) company’s 2024 earnings and sales are likely to witness growth of 13.1% and 9.2% year over year, respectively. Earnings estimates for 2024 have increased upward to $21.05 per share from $20.86 over the past 60 days. This positive trend signifies bullish analysts’ sentiments, indicating robust fundamentals and the expectation of outperformance in the near term.
Other Key Picks
Some other top-ranked stocks from the Zacks Construction sector are:
Armstrong World Industries, Inc. (AWI - Free Report) currently carries a Zacks Rank of 2 (Buy). AWI delivered a trailing four-quarter earnings surprise of 7.9%, on average. The stock has rallied 32.1% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for AWI’s 2024 sales and EPS indicates growth of 1.3% and 6.8%, respectively, from the previous year’s levels.
TopBuild Corp. (BLD - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter earnings surprise of 14.3%, on average. Shares of BLD have surged 97.8% in the past year.
The Zacks Consensus Estimate for BLD’s 2024 sales and EPS indicates an increase of 7.1% and 4.9%, respectively, from the year-ago period’s levels.
NVR, Inc. (NVR - Free Report) currently carries a Zacks Rank of 2. NVR delivered a trailing four-quarter earnings surprise of 14.6%, on average. The stock has gained 43.5% in the past year.
The Zacks Consensus Estimate for NVR’s 2024 sales and EPS indicates a decline of 3.7% and 10.2%, respectively, from the prior-year levels.