Argus has revised its price target for Vulcan Materials (VMC, Financial), reducing it from $315 to $275 while maintaining a Buy rating on the stock. Despite the adjustment, Vulcan is recognized for its strong operational history and strategic positioning within the industry.
The company is expected to gain from prospective deregulation efforts, alongside anticipated price hikes and a burgeoning construction market. These factors could potentially strengthen Vulcan's market standing and financial performance moving forward, according to the analyst's assessment.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 24 analysts, the average target price for Vulcan Materials Co (VMC, Financial) is $291.96 with a high estimate of $325.00 and a low estimate of $184.78. The average target implies an upside of 19.79% from the current price of $243.73. More detailed estimate data can be found on the Vulcan Materials Co (VMC) Forecast page.
Based on the consensus recommendation from 26 brokerage firms, Vulcan Materials Co's (VMC, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Vulcan Materials Co (VMC, Financial) in one year is $247.94, suggesting a upside of 1.73% from the current price of $243.73. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Vulcan Materials Co (VMC) Summary page.
VMC Key Business Developments
Release Date: February 18, 2025
- Adjusted EBITDA (Q4 2024): $550 million, a 16% improvement over the prior year.
- Adjusted EBITDA Margin: Improved for the eighth consecutive quarter year-over-year.
- Aggregates Cash Gross Profit per Ton (Q4 2024): Expanded 16% to $11.50.
- Aggregates Freight-Adjusted Price (Q4 2024): Improved 11%.
- Aggregate Shipments (Q4 2024): 3% lower than the prior year.
- Freight-Adjusted Unit Cash Cost of Sales (Q4 2024): Increased 5% compared to the prior year.
- Adjusted EBITDA (Full Year 2024): $2.1 billion.
- Aggregates Cash Gross Profit per Ton (Full Year 2024): Grew by 12% to $10.61.
- SAG Expenses (Full Year 2024): 2% lower than the prior year; 7.2% of revenue.
- Return on Invested Capital (Year End 2024): 16.2%.
- Net Debt to Adjusted EBITDA Leverage (Year End 2024): 2.3 times.
- 2025 Adjusted EBITDA Guidance: Between $2.35 billion and $2.55 billion.
- 2025 Expected Aggregate Shipments Growth: Increase between 3% and 5%.
- 2025 Expected SAG Expenses: Between $550 million and $560 million.
- 2025 Expected Depreciation, Depletion, Amortization, and Accretion Expenses: Approximately $800 million.
- 2025 Expected Interest Expense: Approximately $245 million.
- 2025 Expected Effective Tax Rate: Between 22% and 23%.
- 2025 Capital Expenditures Plan: Between $750 million and $800 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Vulcan Materials Co (VMC, Financial) reported a 16% improvement in adjusted EBITDA for the fourth quarter, reaching $550 million.
- The company achieved an 11% increase in freight-adjusted aggregate prices in the fourth quarter, consistent with full-year results.
- Vulcan Materials Co (VMC) successfully deployed over $2 billion towards strategic acquisitions, expanding its presence in new growth areas.
- The company maintained a strong balance sheet with a net debt to adjusted EBITDA leverage of 2.3 times.
- Vulcan Materials Co (VMC) anticipates continued growth in public construction activity, supported by $45 billion in state and local funding initiatives.
Negative Points
- Aggregate shipments were 3% lower than the prior year, indicating challenges in certain geographic areas.
- Private construction activity faced headwinds, impacting overall demand.
- Affordability and elevated interest rates remain significant challenges for residential construction activity.
- The company expects lower private nonresidential demand in 2025, with a potential recovery only in the second half of the year.
- Weather conditions, particularly cold and wet weather, have impacted the start of the year, posing challenges to shipment volumes.
