Please ensure Javascript is enabled for purposes of website accessibility

Why Martin Marietta Materials, Inc. Shares Popped

By Brian D. Pacampara, CFA - Feb 9, 2016 at 3:27PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The building products specialist bounces on an upbeat outlook. But will the turnaround last?

What: Shares of building materials company Martin Marietta Materials (MLM -1.93%) were up 11.1% at 2:55 p.m. ET on Tuesday after its full-year outlook impressed Wall Street.

So what: Martin Marietta shares have slumped in recent months on concerns over its exposure to a slowing economy, but positive full-year guidance suggests that those worries are a tad overblown. So while the company's Q4 results actually missed expectations -- adjusted EPS of $1.15 fell short of the consensus by $0.22 on a revenue decline of 1.4% -- better-than-expected aggregates volume and cement guidance for 2016 is forcing analysts to quickly recalibrate their growth estimates going forward.

Now what: Management now expects full-year 2016 EBITDA of $930 million-$980 million on revenue of $3.5 billion-$3.7 billion. "Our outlook for 2016 reflects growing underlying demand and strong pricing across our entire geographic footprint," said Chairman, President, and CEO Ward Nye. "We are well positioned, through our leading market positions and strong foundation, to capitalize on these opportunities and enhance long-term shareholder value." With the stock now up more than 20% from its 52-week lows and trading at a forward P/E of about 20, however, I'd wait for a bit of the excitement to fade before buying into that bullishness. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Martin Marietta Materials, Inc. Stock Quote
Martin Marietta Materials, Inc.
MLM
$302.81 (-1.93%) $-5.95

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
332%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/28/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.