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Vulcan (VMC) Down 2.7% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Vulcan Materials (VMC - Free Report) . Shares have lost about 2.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Vulcan due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Vulcan Q2 Earnings & Revenues Lag Estimates, '24 View Cut
Vulcan reported dismal second-quarter 2024 results, with earnings and revenues missing their respective Zacks Consensus Estimate. On a year-over-year basis, earnings increased, but revenues declined due to lower Aggregate shipments.
Inside the Headlines
Adjusted earnings of $2.35 per share missed the consensus mark of $2.47 by 4.9% but increased 2.6% from the year-ago level of $2.29.
Total revenues of $2.01 billion missed the consensus mark of $2.03 billion by 1% and declined 4.7% year over year.
Segments in Detail
Aggregates
Revenues from the segment were up 2.1% year over year to $1.61 billion. Aggregate shipments (volumes) declined 5% year over year to 60.1 million tons.
Freight-adjusted average sales price rose 12.2% to $21.00 per ton from the prior-year level of $18.71. Freight-adjusted revenues rose 6.4% from the prior-year quarter’s levels to $1.26 billion. Gross profit of $528.5 million inched up from the prior-year figure of $499.7 million. Cash gross profit per ton improved to $10.92 from $9.76, backed by continued pricing momentum and solid execution despite lower shipments stemming from unfavorable weather conditions for most of the quarter.
Asphalt and Concrete
Revenues in the Asphalt segment were $351.2 million, up 4.1% year over year. The segment generated a solid gross profit of $59 million compared with $56.6 million a year ago. Volumes were in line with the year-ago figures, while prices improved 4%. Strong shipments in California (its largest asphalt market) were partially offset by lower shipments in Texas due to inclement weather.
Total revenues from the Concrete segment were $167.3 million, down 51.3% year over year. Gross profit totaled $4.7 million compared with $27 million in the year-ago period. Shipments fell to 0.9 million cubic yards from 2.1 million cubic yards year over year. Average selling prices increased 10% from the prior-year level.
Operating Highlights
Selling, administrative and general (SAG) expenses — as a percentage of total revenues — rose 10 basis points to 6.7% from a year ago.
Adjusted EBITDA margin was up 170 bps to 29.9% year over year.
Financials
As of Jun 30, 2024, cash and cash equivalents were $111 million, down from $931.1 million at 2023-end. Long-term debt was $3.33 billion at June-end, down from the 2023 level of $3.88 billion. At Jun-end, total debt to trailing-12-months adjusted EBITDA was 1.7x, down from 1.9x at the end of 2023.
In the first half of 2024, net cash provided by operating activities was $374.5 million compared with $507.5 million a year ago.
2024 Guidance Lowered
Vulcan now anticipates adjusted EBITDA in the range of $2.00-$2.15 billion, up from the prior projection of $2.15-$2.30 billion. This indicates a 3.2% improvement from 2023 levels, considering the mid-point of the guidance. Net earnings are now expected in the range of $0.95-$1.07 billion (up from the prior projection of $1.07-$1.19) versus $933 million in the prior year.
SAG expenses are expected to be in the range of $550-$560 million (versus $543 million in 2023), with interest expenses of approximately $155 million, depreciation, depletion, accretion and amortization expenses of nearly $610 million and an effective tax rate of 22-23%.
In the Aggregates segment, cash gross profit per ton is likely to improve from the 2023 level of $9.46. Total shipments are likely to be down 4, freight-adjusted price growth is likely to be in the range of 10-12% and freight-adjusted cash cost is estimated to increase high-single digits. In the Asphalt, Concrete and Calcium segment, cash gross profit is expected to be $275 million.
The company expects capital expenditures to be between $625 million and $675 million for maintenance and growth projects.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -11.59% due to these changes.
VGM Scores
At this time, Vulcan has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Vulcan has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Vulcan (VMC) Down 2.7% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Vulcan Materials (VMC - Free Report) . Shares have lost about 2.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Vulcan due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Vulcan Q2 Earnings & Revenues Lag Estimates, '24 View Cut
Vulcan reported dismal second-quarter 2024 results, with earnings and revenues missing their respective Zacks Consensus Estimate. On a year-over-year basis, earnings increased, but revenues declined due to lower Aggregate shipments.
Inside the Headlines
Adjusted earnings of $2.35 per share missed the consensus mark of $2.47 by 4.9% but increased 2.6% from the year-ago level of $2.29.
Total revenues of $2.01 billion missed the consensus mark of $2.03 billion by 1% and declined 4.7% year over year.
Segments in Detail
Aggregates
Revenues from the segment were up 2.1% year over year to $1.61 billion. Aggregate shipments (volumes) declined 5% year over year to 60.1 million tons.
Freight-adjusted average sales price rose 12.2% to $21.00 per ton from the prior-year level of $18.71. Freight-adjusted revenues rose 6.4% from the prior-year quarter’s levels to $1.26 billion.
Gross profit of $528.5 million inched up from the prior-year figure of $499.7 million. Cash gross profit per ton improved to $10.92 from $9.76, backed by continued pricing momentum and solid execution despite lower shipments stemming from unfavorable weather conditions for most of the quarter.
Asphalt and Concrete
Revenues in the Asphalt segment were $351.2 million, up 4.1% year over year. The segment generated a solid gross profit of $59 million compared with $56.6 million a year ago. Volumes were in line with the year-ago figures, while prices improved 4%. Strong shipments in California (its largest asphalt market) were partially offset by lower shipments in Texas due to inclement weather.
Total revenues from the Concrete segment were $167.3 million, down 51.3% year over year. Gross profit totaled $4.7 million compared with $27 million in the year-ago period. Shipments fell to 0.9 million cubic yards from 2.1 million cubic yards year over year. Average selling prices increased 10% from the prior-year level.
Operating Highlights
Selling, administrative and general (SAG) expenses — as a percentage of total revenues — rose 10 basis points to 6.7% from a year ago.
Adjusted EBITDA margin was up 170 bps to 29.9% year over year.
Financials
As of Jun 30, 2024, cash and cash equivalents were $111 million, down from $931.1 million at 2023-end. Long-term debt was $3.33 billion at June-end, down from the 2023 level of $3.88 billion.
At Jun-end, total debt to trailing-12-months adjusted EBITDA was 1.7x, down from 1.9x at the end of 2023.
In the first half of 2024, net cash provided by operating activities was $374.5 million compared with $507.5 million a year ago.
2024 Guidance Lowered
Vulcan now anticipates adjusted EBITDA in the range of $2.00-$2.15 billion, up from the prior projection of $2.15-$2.30 billion. This indicates a 3.2% improvement from 2023 levels, considering the mid-point of the guidance. Net earnings are now expected in the range of $0.95-$1.07 billion (up from the prior projection of $1.07-$1.19) versus $933 million in the prior year.
SAG expenses are expected to be in the range of $550-$560 million (versus $543 million in 2023), with interest expenses of approximately $155 million, depreciation, depletion, accretion and amortization expenses of nearly $610 million and an effective tax rate of 22-23%.
In the Aggregates segment, cash gross profit per ton is likely to improve from the 2023 level of $9.46. Total shipments are likely to be down 4, freight-adjusted price growth is likely to be in the range of 10-12% and freight-adjusted cash cost is estimated to increase high-single digits.
In the Asphalt, Concrete and Calcium segment, cash gross profit is expected to be $275 million.
The company expects capital expenditures to be between $625 million and $675 million for maintenance and growth projects.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -11.59% due to these changes.
VGM Scores
At this time, Vulcan has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Vulcan has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.