Truist Securities has revised its price target for Eagle Materials (EXP, Financial), lowering it from $330 to $280 while maintaining a Buy rating on the stock. This adjustment comes in anticipation of the company's upcoming fourth-quarter earnings report, expected next month.
The decision to reduce the price target stems from a significant decline in industry wallboard shipments during the first quarter of the calendar year, a trend Truist forecasts could continue over the coming quarters. Despite the current challenges, the firm acknowledges that the evolving impact of tariffs could alter these projections as we move into 2025, potentially affecting the estimates both directly and indirectly.
Investors are advised to stay informed about these developments as they could influence Eagle Materials' market performance in the near future.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 10 analysts, the average target price for Eagle Materials Inc (EXP, Financial) is $268.01 with a high estimate of $330.00 and a low estimate of $235.00. The average target implies an upside of 24.79% from the current price of $214.77. More detailed estimate data can be found on the Eagle Materials Inc (EXP) Forecast page.
Based on the consensus recommendation from 12 brokerage firms, Eagle Materials Inc's (EXP, Financial) average brokerage recommendation is currently 2.4, 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 Eagle Materials Inc (EXP, Financial) in one year is $214.37, suggesting a downside of 0.18% from the current price of $214.765. 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 Eagle Materials Inc (EXP) Summary page.
EXP Key Business Developments
Release Date: January 29, 2025
- Revenue: $558 million, a slight decrease from the prior year.
- Earnings Per Share (EPS): $3.56, reflecting lower earnings offset by a 3% reduction in fully diluted shares.
- Heavy Materials Revenue: Declined 4% due to lower cement sales volume, partially offset by price increases.
- Light Materials Revenue: Increased 6% with higher wallboard and recycled paperboard sales volume and prices.
- Wallboard Sales Volume: Increased 2%.
- Recycled Paperboard Sales Volume: Increased 7%.
- Wallboard Prices: Increased 4%.
- Recycled Paperboard Prices: Increased 12%.
- Operating Earnings (Light Materials): Up 18% to $97 million.
- Operating Cash Flow: $486 million for the first nine months of the year.
- Capital Spending: Increased to $147 million, primarily for the Laramie, Wyoming cement plant project.
- Share Repurchase: Nearly 800,000 shares repurchased for $201 million.
- Net Debt-to-Cap Ratio: 40% as of December 31, 2024.
- Net Debt-to-EBITDA Leverage Ratio: 1.2 times.
- Total Committed Liquidity: Approximately $686 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Eagle Materials Inc (EXP, Financial) reported near-record third quarter revenue despite challenging weather conditions affecting cement volumes.
- The company achieved its lowest total recordable incident rate, highlighting a strong focus on safety.
- Significant progress was made on sustainability initiatives, including reducing CO2 intensity and water usage.
- The acquisition of Bullskin Stone & Lime aligns with Eagle's growth strategy, expanding its presence in Western Pennsylvania.
- Eagle Materials Inc (EXP) continues to generate significant free cash flow, allowing for strategic investments and share buybacks.
Negative Points
- Cement volumes were down 7% due to record rainfall, impacting overall sales.
- Increased maintenance costs at cement plants affected quarterly earnings.
- The outlook for wallboard demand is uncertain due to fluctuating interest and mortgage rates.
- Third quarter revenue saw a slight decline compared to the previous year, driven by lower cement and aggregate sales volumes.
- The company faced a non-routine expense of $1.3 million related to business development and transaction activities.
