Eagle Materials stock target cut to $255 at Stephens

On Thursday, Stephens analyst Trey Grooms revised the price target for Eagle Materials (NYSE:EXP) shares, reducing it to $255 from the previous target of $275. Despite this change, Grooms maintained an Overweight rating on the stock. According to InvestingPro data, the stock has recently experienced significant pressure, with a -8.45% return over the past week, though the company maintains strong fundamentals with a healthy current ratio of 2.73.

Eagle Materials, currently valued at $7.02 billion, reported its fourth-quarter results, which fell short of market expectations. The miss was attributed to decreased volumes and an unexpected advancement of maintenance expenses in the cement sector, alongside wallboard (WB) pricing that remained stable sequentially when excluding the impact of increased freight costs during the quarter. InvestingPro analysis shows 8 analysts have revised their earnings downwards for the upcoming period, suggesting continued near-term challenges. Wallboard EBIT margins also saw a year-over-year decline, influenced by slightly lower-than-expected pricing, although this was somewhat mitigated by better-than-expected volume.

The company’s cement margins were affected by adverse weather conditions and the early scheduling of maintenance costs, although these effects were partially balanced by pricing strategies. Management highlighted that cement volumes have shown positive growth year-over-year in April.

Looking ahead, analysts at Stephens anticipate that cement pricing will stay around current levels and that the fourth quarter should mark the lowest point for cement margins. Wallboard pricing is expected to remain relatively stable, with volumes predicted to decrease in the mid- to low-single digits until there is an improvement in demand. Once demand picks up, Stephens foresees a potential for significant pricing power in both cement and wallboard markets. The company’s robust return on equity of 34% and gross profit margin of 29.78% suggest strong operational efficiency despite current challenges. For deeper insights into Eagle Materials’ financial health and growth prospects, including exclusive ProTips and comprehensive valuation metrics, visit InvestingPro.

In summary, while the price target for Eagle Materials has been lowered, the Overweight rating suggests that Stephens analysts continue to see the stock as a favorable investment. The revised target reflects the company’s recent performance and the near-term industry outlook.

In other recent news, Eagle Materials reported its first-quarter earnings for 2025, revealing both earnings per share (EPS) and revenue figures that fell short of analyst expectations. The company’s EPS was $2.08, below the anticipated $2.58, while revenue reached $470.2 million, missing the forecasted $487.58 million. Despite these setbacks, Eagle Materials achieved a record fiscal year revenue of $2.3 billion. Analysts have responded with adjustments to the company’s price targets; Loop Capital reduced its target to $237, Stifel adjusted it to $241, and Jefferies lowered it to $220, all while maintaining a Hold rating on the stock. The company’s recent performance has been influenced by adverse weather conditions and operational challenges, particularly affecting its cement and wallboard segments. Looking forward, Eagle Materials anticipates capital expenditures ranging from $475 million to $525 million for fiscal year 2026, focusing on modernization and expansion projects. Analysts from Jefferies expect the company’s earnings to remain relatively stable in fiscal year 2026, with a recovery in the cement sector anticipated. Eagle Materials continues to navigate through a challenging market environment, with strategic investments aimed at strengthening its position.

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