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On Tuesday, DA Davidson maintained a Buy rating on shares of Martin Marietta Materials (NYSE:MLM), expressing confidence in the company's first-quarter EBITDA estimates, which align with consensus. According to InvestingPro data, the company currently generates $2.06 billion in EBITDA with a market capitalization of $28.09 billion. The stock, currently trading at $459.56, appears undervalued based on InvestingPro's Fair Value analysis. Analyst Brent Thielman highlighted the robust public sector trends in key markets for MLM, which are expected to counterbalance weaker private sector trends in the near term. The analyst also noted MLM's pricing power as a hedge against potential inflationary pressures and a lever in case of favorable shifts in interest rates.
Martin Marietta Materials' stock is currently trading at a discount compared to DA Davidson's reserves and asset analysis, with a P/E ratio of 14.18 and strong financial metrics. InvestingPro analysis reveals the company maintains excellent financial health with an overall score of 3.1 (GREAT), supported by a healthy current ratio of 2.5. In Texas, trailing twelve-month (TTM) comparisons show a 33% year-over-year increase, with the value of lettings significantly surpassing five-year and ten-year averages by 92% and 133%, respectively. Fiscal year-to-date bid values have already exceeded the total for fiscal 2022, and while projected values for fiscal 2025 and 2026 are slightly below those for fiscal 2024, they remain substantially higher than the past decade's values.
In North Carolina, the TTM value in the Central division has surged 64% year-over-year, with an overall increase of 46% across all divisions. The TTM values in the Central division are 80% higher than both the five-year and ten-year averages. The bidding schedules for the remainder of 2025 indicate a continuation of near-record value bids, maintaining historically high levels.
Colorado's TTM comparisons show a 28% year-over-year increase, with lettings values exceeding the five-year and ten-year averages by 35% and 34%, respectively. Conversely, California experienced a 17% decrease year-over-year in TTM comparisons, but lettings values are still above the five-year and ten-year averages. The state's planned bids for 2025 indicate an ongoing elevated backlog of projects.
Lastly, Georgia's TTM comparisons rose 11% year-over-year, with lettings values 24% and 46% above the five-year and ten-year averages, respectively. The state's schedule for 2025 suggests a continuation of record or near-record levels, signaling a sustained elevated pace of project releases. With these positive trends in key markets, DA Davidson's stance on Martin Marietta Materials stock remains bullish. Analyst targets range from $380 to $715, reflecting diverse market perspectives. For deeper insights into MLM's valuation and growth potential, including 10+ additional ProTips and comprehensive financial analysis, visit InvestingPro to access the detailed Pro Research Report.
In other recent news, Martin Marietta Materials has been the focus of several analyst updates. JPMorgan downgraded the company's stock rating from Overweight to Neutral, adjusting the price target to $560 due to a revised EBITDA estimate of $2.275 billion, reflecting a 3% decrease from prior projections. Despite this, the company's revenue outlook remains stable, with a 9% year-over-year increase anticipated. In contrast, Stifel resumed coverage with a Buy rating and set a price target of $559, citing Martin Marietta's strategic focus on aggregates and strong regional presence as key growth drivers.
Citi maintained a Buy rating but lowered the price target to $594, highlighting the company's cautious stance on private market demand while noting a positive outlook for public infrastructure. Similarly, Truist Securities adjusted the price target to $610, maintaining a Buy rating and pointing to potential revenue gains from pricing increases and federal infrastructure spending. Raymond (NSE:RYMD) James also revised the price target to $600, retaining an Outperform rating, and emphasized Martin Marietta's strategy of focusing on value over volume as a positive factor. These developments reflect a mix of cautious optimism and strategic focus for Martin Marietta Materials in the current market environment.
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