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Martin Marietta (MLM) Q2 Earnings: Disappointment in Store?

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Martin Marietta Materials, Inc. (MLM - Free Report) is set to report second-quarter 2017 results on Aug 1, before the market opens.

Last quarter, the company posted a positive earnings surprise of 8.1%. However, the company missed estimates in three of the past four quarters, with an average negative surprise of 2.78%.

Let’s see how things are shaping up for this announcement.

Factors to Consider

Martin Marietta’s prospects are getting marred by weather-related risks despite improving economic conditions, cost management and enhanced operational efficiency. Abnormally wet weather conditions in many markets can affect production schedules and profits to a large extent.

However, the company’s string of acquisitions, divestitures and an uptick in private and public construction activity are encouraging. Sustained growth in construction activity drives the demand for both the aggregates and cement businesses of the company. This can be expected to benefit results in the to-be-reported quarter.

Notably, for the second quarter, the Zacks Consensus Estimate for earnings is pegged at $2.38, reflecting a 25.3% year-over-year increase. Also, the Zacks Consensus Estimate for revenues is pegged at $1.01 billion, reflecting 10.1% growth.

Earnings Whispers

Our proven model does not conclusively show an earnings beat for Martin Marietta this quarter. That is because a stock needs to have both a positive Earnings ESP  and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here, as you will see below.

Zacks ESP: The company’s Earnings ESP is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $2.38. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Martin Marietta Materials, Inc. Price and EPS Surprise


Zacks Rank: Martin Marietta has a Zacks Rank #4 (Sell). Note that we caution against stocks with a Zacks Rank #4 or 5 (Strong Buy) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Releases in the Sector

D.R. Horton, Inc. (DHI - Free Report) came up with yet another stellar show in the third quarter of fiscal 2017. Both earnings and revenues beat the Zacks Consensus Estimate, courtesy of a solid housing market scenario.

NVR, Inc.’s (NVR - Free Report) second-quarter 2017 earnings surpassed the Zacks Consensus Estimate by 22.9%. Total revenue (Homebuilding & Mortgage Banking fees) was $1.54 billion in the quarter and increased 11% year over year, driven by higher housing revenues and mortgage-banking fees.

Upcoming Release in the Sector

Louisiana-Pacific Corp. (LPX - Free Report) is scheduled to release its quarterly numbers on Aug 1. The Zacks Consensus Estimate for earnings is pegged at 61 cents, highlighting an increase of 116.7% on a year-over-year basis.

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