Materials Sector Stocks Offer Good Relative Value
Martin Marietta and Vulcan Materials are best-positioned among U.S. aggregates and concrete stocks.
Kristoffer Inton: Over the past two years, U.S. aggregates and concrete stocks--including companies like Martin Marietta and Vulcan Materials--have rallied about 50%, far outpacing the S&P 500.
While profits have climbed as construction markets recovered, the rally primarily reflects multiple expansion and expectations of higher profits in the years to come. Shares now trade at multiples higher than both historical and midcycle levels. Are they worth it?
Kristoffer Inton does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.