Martin Marietta Materials Inc. shares rose Tuesday after the construction materials supplier reiterated its full-year earnings forecast despite a sharp drop in first-quarter results.
The stock added 4 cents to $112, after trading as high as $114.45 earlier in the session. In the past year, it has ranged from $95.02 to $170.25.
Raleigh, N.C.-based Martin Marietta, which provides granite, limestone, sand and gravel to construction firms, on Tuesday reported a 37 percent decline in first-quarter profit to $20.9 million, or 50 cents per share. The result missed analyst expectations according to a Thomson Financial survey.
The company said its diesel fuel costs rose by $6.2 million, reducing profit by 9 cents per share. Sales fell 3 percent to $399 million.
Martin Marietta said it plans to accelerate the rate of price increases for its materials in an attempt to shore up earnings for the year. That prompted it to reiterate its expectation for profit between $6.25 to $7 per share in 2008.
Citi analyst Clyde Lewis said his estimates are at the low end of that range. In a note to investors, he added he is "nervous about the extent of the nonresidential slowdown and the level of state spending in the face of weaker tax revenues."
Martin Marietta relies on infrastructure projects and homebuilders for much of its revenue. Builders have notably curbed construction as the housing market swoons, and municipalities are starting to cut back on spending as the economy slows.
Terms & Conditions
RSS Headlines
Fool UK