VMC - Vulcan Materials: Pricing Could Drive Further Growth
2024-03-06 20:23:22 ET
Summary
- Vulcan Materials has grown substantially over the past several years thanks to fairly impressive aggregates pricing growth.
- Vulcan Materials reported a strong Q4 and also 2023, with adjusted EBITDA and EPS both increasing substantially thanks to strong aggregates cash gross profit growth.
- For 2024, management expects adjusted EBITDA of $2.15 to $2.30 billion, which would be 11% organic growth at the midpoint versus 2023.
- For 2024, management expects aggregates freight adjusted price improvement of 10 to 12 percent.
- Although it is a quality company, I rate Vulcan Materials a 'Hold' given its premium valuation.
Vulcan Materials Company ( VMC ) is a leading supplier of aggregates in the United States.
According to its 2023 annual report released February 22, 2024, 89% of Vulcan Materials' gross profits for the year came from aggregates, which are widely used in public and private construction.
In terms of total revenues for 2023, aggregates accounted for 69%, asphalt accounted for 15%, and concrete accounted for 16%....
Vulcan Materials: Pricing Could Drive Further Growth