Headquartered in Raleigh, North Carolina, Martin Marietta Materials, Inc. (MLM) is a natural resource-based building materials company that supplies aggregates and heavy-side building materials to the construction industry. Valued at a market cap of $33.9 billion, the company’s core products include crushed stone, sand, gravel, cement, ready-mixed concrete, asphalt, and paving services. 

Shares of this building materials company have lagged behind the broader market over the past 52 weeks. MLM has declined 2.1% over this time frame, while the broader S&P 500 Index ($SPX) has gained 10.2%. Nonetheless, on a YTD basis, the stock is up 8.8%, outperforming SPX’s 1.3% loss. 

Narrowing the focus, MLM has also underperformed the Invesco Building & Construction ETF’s (PKB) 9.9% return over the past 52 weeks. However, it has outpaced the ETF’s 1.8% rise on a YTD basis. 

On Apr. 30, shares of MLM surged 3.8% after its Q1 earnings release, despite delivering a weaker-than-expected profit of $1.90 per share, which declined 88.7% from the year-ago quarter. The sharp fall in EPS was mainly due to a nonrecurring gain on a divestiture recorded in the previous year's quarter. Nonetheless, on the upside, due to continued pricing momentum and effective cost management, its aggregates product line’s gross profit per ton increased 16.4% year-over-year to a new Q1 record of $7.60. Moreover, compared to the prior-year quarter, its overall gross profit improved 23.2% to $335 million, while its adjusted EBITDA climbed 20.6% to $351 million. Adding to the uptick, driven by strong infrastructure demand, its revenue rose 8.2% annually to $1.4 billion and met the forecasted figure. 

For fiscal 2025, MLM anticipated revenue to be between $6.8 billion and $7.2 billion, and expects adjusted EBITDA in the range of $2.2 billion to 2.4 billion. 

For the current fiscal year, ending in December, analysts expect MLM’s EPS to decline 41.6% year over year to $18.93. The company’s earnings surprise history is disappointing. It missed the consensus estimates in three of the last four quarters, while surpassing on another occasion. 

Among the 18 analysts covering the stock, the consensus rating is a “Strong Buy” which is based on 13 “Strong Buy,” one “Moderate Buy,” and four “Hold” ratings. 

This configuration is more bullish than a month ago, with an overall “Moderate Buy” rating, consisting of 12 analysts suggesting a “Strong Buy.”

On May 16, UBS Group AG (UBS) upgraded MLM’s rating to “Buy” and raised its price target to $634, which indicates a 12.9% potential upside from the current levels. 

The mean price target of $606.87 represents an 8% premium from MLM’s current price levels, while the Street-high price target of $670 suggests a upside potential of 19.3%.