Martin Marietta Materials ( NYSE: MLM ) +0.8% in Thursday's trading after Wolfe Research upgraded shares to Outperform from Peer Perform despite a price target reduction to $384 from $406 and estimated 2022-23 EBITDA below consensus.
Wolfe's Timna Tanners thinks the stock's 30% retreat YTD is excessive given the industry's pricing power and infrastructure stimulus boosting 2023 demand.
Martin Marietta's ( MLM ) Lehigh Hanson acquisition initially dragged down pricing, but 2022 aggregates should easily hit the high end of a guided 9%-11% Y/Y increase, said Tanners, who also cut estimated 2022E EBITDA to $1.66B on steeper than expected diesel prices.
Tanners also stays positive on Vulcan Materials ( VMC ) while cutting its price target to $194 from $211 from both energy cost pressure and a guided $80M-$100M EBITDA hit from Mexico forcing its Yucatan quarry to shut .
For further details see:
Martin Marietta raised to Outperform at Wolfe as 30% YTD drop 'excessive'