Vulcan's Profits Weighing on Construction Materials Shares.
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy VMC?
Source: Barron's
- Vulcan Materials Performance: The construction materials company Vulcan Materials is showing improvement in its performance.
- Investor Expectations: The level of improvement is not meeting investor expectations, leading to pressure on stocks in the construction materials sector.
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Analyst Views on VMC
Wall Street analysts forecast VMC stock price to rise
9 Analyst Rating
8 Buy
1 Hold
0 Sell
Strong Buy
Current: 302.220
Low
316.00
Averages
334.13
High
370.00
Current: 302.220
Low
316.00
Averages
334.13
High
370.00
About VMC
Vulcan Materials Company is a supplier of construction aggregates and producer of aggregates-based construction materials. The Company’s segments include Aggregates, Asphalt and Concrete. The Aggregates segment produces and sells aggregates, such as crushed stone, sand and gravel, sand, and other aggregates and related products and services. This segment also includes a production stage and leased calcium operation located in Brooksville, Florida. This limestone quarry produces a supplement for end-use products such as animal feed and plastics. The Asphalt segment produces and sells asphalt mix in Alabama, Arizona, California, New Mexico, Tennessee and Texas and provides asphalt construction paving services in Alabama, Tennessee and Texas. The Concrete segment produces and sells ready-mixed concrete in California, Maryland and Virginia. The Company provides the basic materials for the infrastructure delivered by trucks, ships, barges, and trains.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Vulcan Materials Stock Drops 8.3% Following Disappointing Q4 Results
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- Earnings Report Impact: The decline in shares indicates a negative market reaction to the company's quarterly performance.
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- Adjusted Earnings: Excluding items, the company reported adjusted earnings of $1.70 per share, which, while lower than the previous year, still demonstrates some resilience in profitability, reflecting efforts in cost control.
- Revenue Growth: The company's revenue for the fourth quarter rose by 3.2% to $1.912 billion from $1.853 billion last year, showcasing stability in market demand and the company's competitive position in the industry.
- Market Outlook: Despite the decline in earnings, the revenue growth may provide funding support for future investments and expansions, indicating Vulcan Materials' ability to adapt to challenges in the market.
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- Strong Financial Performance: Vulcan Materials reported an adjusted EBITDA of $2.3 billion for 2025, reflecting a 13% year-over-year increase and an EBITDA margin expansion to 29.3%, demonstrating the company's success in cost control and operational discipline despite weaker-than-expected single-family residential activity.
- Significant Cash Flow Growth: Free cash flow increased by over 40% after $678 million in capital expenditures, with a net debt-to-adjusted EBITDA leverage ratio of 1.8x, indicating a robust strategy in capital allocation and shareholder returns.
- Optimistic Future Outlook: The company expects Aggregates shipments to grow between 1% and 3% in 2026, with freight-adjusted average selling prices projected to rise by 4% to 6%, reflecting confidence in future market demand, particularly in public infrastructure and industrial projects.
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- Stock Performance: Vulcan Materials shares fell by 8.3% following the release of their Q4 results.
- Earnings Report Impact: The decline in shares indicates a negative market reaction to the company's quarterly performance.
See More
Trump Administration Releases Gateway Tunnel Funds
- Funding Release: The Trump administration released $98 million previously withheld for the Gateway Tunnel construction and an additional $30 million in reimbursements, significantly enhancing passenger rail capacity into Manhattan.
- Project Resumption: The funding freeze had triggered a work stoppage threatening nearly 1,000 jobs, but contractors are now instructed to prepare for construction resumption next week, ensuring the project stays on track.
- Legal Obligation: Governor Hochul emphasized that the federal government has a legal obligation to fully fund the Gateway project, highlighting the importance of continuous funding support to prevent future disruptions for workers and commuters.
- Infrastructure Significance: The Gateway project is one of the most critical infrastructure initiatives in the U.S., with the existing North River Tunnel carrying 200,000 passengers daily and in urgent need of repairs to meet growing transportation demands.
See More
U.S. Stocks Close Mixed, Apple Shares Rise on Product Launch News
- Market Performance Fluctuates: On Tuesday, the S&P 500 rose by 0.10%, the Dow Jones increased by 0.07%, while the Nasdaq 100 fell by 0.13%, indicating a mixed market recovery from early losses, with the Nasdaq 100 hitting a 2.75-month low, reflecting investor caution towards tech stocks.
- Apple Product Launch Boost: Apple shares surged over 3% after announcing a product launch on March 4, with several new devices expected in the coming weeks, which not only boosted Apple's market performance but also generated positive sentiment across the tech sector.
- Airline Stocks Rally: Airline stocks showed strong performance on Tuesday, led by a 6% increase in Southwest Airlines after UBS upgraded its rating from neutral to buy with a price target of $73, which not only enhanced the overall performance of airline stocks but also contributed to a more optimistic market outlook.
- Mixed Economic Data: The U.S. February NAHB housing market index unexpectedly fell to a 5-month low of 36, below the expected 38, while the February Empire manufacturing survey slightly declined to 7.1, indicating uncertainty in economic recovery, as the market remains focused on upcoming corporate earnings and economic news.
See More
Vulcan Materials Reports Decline in Q4 Earnings
- Earnings Decline: Vulcan Materials reported a fourth-quarter profit of $252 million, translating to $1.91 per share, which is a decrease from $293.8 million and $2.21 per share last year, indicating pressure on the company's profitability.
- Adjusted Earnings: Excluding items, the company reported adjusted earnings of $1.70 per share, which, while lower than the previous year, still demonstrates some resilience in profitability, reflecting efforts in cost control.
- Revenue Growth: The company's revenue for the fourth quarter rose by 3.2% to $1.912 billion from $1.853 billion last year, showcasing stability in market demand and the company's competitive position in the industry.
- Market Outlook: Despite the decline in earnings, the revenue growth may provide funding support for future investments and expansions, indicating Vulcan Materials' ability to adapt to challenges in the market.
See More
Vulcan Materials Company Q4 2025 Earnings Call Highlights
- Strong Financial Performance: Vulcan Materials reported an adjusted EBITDA of $2.3 billion for 2025, reflecting a 13% year-over-year increase and an EBITDA margin expansion to 29.3%, demonstrating the company's success in cost control and operational discipline despite weaker-than-expected single-family residential activity.
- Significant Cash Flow Growth: Free cash flow increased by over 40% after $678 million in capital expenditures, with a net debt-to-adjusted EBITDA leverage ratio of 1.8x, indicating a robust strategy in capital allocation and shareholder returns.
- Optimistic Future Outlook: The company expects Aggregates shipments to grow between 1% and 3% in 2026, with freight-adjusted average selling prices projected to rise by 4% to 6%, reflecting confidence in future market demand, particularly in public infrastructure and industrial projects.
- Ongoing Strategic Investments: Planned capital expenditures for 2026 are set between $750 million and $800 million, with management anticipating further improvements in adjusted EBITDA margins and cash generation capabilities, showcasing the company's proactive approach to expansion and acquisitions.
See More
General Mills Lowers 2026 Outlook, Shares Drop
- General Mills Outlook Downgrade: General Mills has lowered its 2026 organic net sales forecast to a decline of 1.5% to 2%, with operating profit and adjusted EPS expected to fall by 16% to 20%, resulting in a 7% drop in shares, indicating market concerns about future growth.
- Southwest Airlines Stock Surge: Shares of Southwest Airlines rose over 6% after UBS upgraded its rating to buy, with analysts highlighting new initiatives like extra legroom and assigned seating that could attract more travelers, showcasing the company's proactive transformation in a competitive airline market.
- ZIM Integrated Shipping Services Surge: ZIM's shares surged 30% following the announcement that German-based Hapag-Lloyd will acquire ZIM for $4.2 billion, financed through cash and external funding, marking a significant consolidation in the shipping industry.
- Labcorp's Mixed Results: Labcorp reported a fourth-quarter EPS of $4.07, exceeding the $3.94 expected by analysts, yet shares fell over 3% due to concerns regarding the pace of organic revenue growth despite a positive earnings forecast.
See More
