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Vulcan Materials Company (VMC) Soars to 52-Week High, Time to Cash Out?
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Have you been paying attention to shares of Vulcan Materials (VMC - Free Report) ? Shares have been on the move with the stock up 16.6% over the past month. The stock hit a new 52-week high of $269.68 in the previous session. Vulcan Materials has gained 18% since the start of the year compared to the 10.6% move for the Zacks Construction sector and the 17.2% return for the Zacks Building Products - Concrete and Aggregates industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 16, 2024, Vulcan reported EPS of $1.46 versus consensus estimate of $1.36.
For the current fiscal year, Vulcan is expected to post earnings of $8.26 per share on $7.92 billion in revenues. This represents a 18% change in EPS on a 1.78% change in revenues. For the next fiscal year, the company is expected to earn $9.53 per share on $8.55 billion in revenues. This represents a year-over-year change of 15.48% and 7.89%, respectively.
Valuation Metrics
Vulcan may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Vulcan has a Value Score of C. The stock's Growth and Momentum Scores are B and C, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 32.5X current fiscal year EPS estimates, which is a premium to the peer industry average of 14.1X. On a trailing cash flow basis, the stock currently trades at 22.5X versus its peer group's average of 14X. Additionally, the stock has a PEG ratio of 1.98. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Vulcan currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Vulcan meets the list of requirements. Thus, it seems as though Vulcan shares could have potential in the weeks and months to come.
How Does VMC Stack Up to the Competition?
Shares of VMC have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Summit Materials, Inc. (SUM - Free Report) . SUM has a Zacks Rank of # 1 (Strong Buy) and a Value Score of B, a Growth Score of C, and a Momentum Score of A.
Earnings were strong last quarter. Summit Materials, Inc. beat our consensus estimate by 14.81%, and for the current fiscal year, SUM is expected to post earnings of $2.42 per share on revenue of $4.4 billion.
Shares of Summit Materials, Inc. have gained 20.4% over the past month, and currently trade at a forward P/E of 18.17X and a P/CF of 12.62X.
The Building Products - Concrete and Aggregates industry is in the top 16% of all the industries we have in our universe, so it looks like there are some nice tailwinds for VMC and SUM, even beyond their own solid fundamental situation.
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Vulcan Materials Company (VMC) Soars to 52-Week High, Time to Cash Out?
Have you been paying attention to shares of Vulcan Materials (VMC - Free Report) ? Shares have been on the move with the stock up 16.6% over the past month. The stock hit a new 52-week high of $269.68 in the previous session. Vulcan Materials has gained 18% since the start of the year compared to the 10.6% move for the Zacks Construction sector and the 17.2% return for the Zacks Building Products - Concrete and Aggregates industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 16, 2024, Vulcan reported EPS of $1.46 versus consensus estimate of $1.36.
For the current fiscal year, Vulcan is expected to post earnings of $8.26 per share on $7.92 billion in revenues. This represents a 18% change in EPS on a 1.78% change in revenues. For the next fiscal year, the company is expected to earn $9.53 per share on $8.55 billion in revenues. This represents a year-over-year change of 15.48% and 7.89%, respectively.
Valuation Metrics
Vulcan may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Vulcan has a Value Score of C. The stock's Growth and Momentum Scores are B and C, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 32.5X current fiscal year EPS estimates, which is a premium to the peer industry average of 14.1X. On a trailing cash flow basis, the stock currently trades at 22.5X versus its peer group's average of 14X. Additionally, the stock has a PEG ratio of 1.98. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Vulcan currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Vulcan meets the list of requirements. Thus, it seems as though Vulcan shares could have potential in the weeks and months to come.
How Does VMC Stack Up to the Competition?
Shares of VMC have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Summit Materials, Inc. (SUM - Free Report) . SUM has a Zacks Rank of # 1 (Strong Buy) and a Value Score of B, a Growth Score of C, and a Momentum Score of A.
Earnings were strong last quarter. Summit Materials, Inc. beat our consensus estimate by 14.81%, and for the current fiscal year, SUM is expected to post earnings of $2.42 per share on revenue of $4.4 billion.
Shares of Summit Materials, Inc. have gained 20.4% over the past month, and currently trade at a forward P/E of 18.17X and a P/CF of 12.62X.
The Building Products - Concrete and Aggregates industry is in the top 16% of all the industries we have in our universe, so it looks like there are some nice tailwinds for VMC and SUM, even beyond their own solid fundamental situation.