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Category: Stock Market and Eagle Materials
Date: 20 May 2020 Stock Price: $60.21 We take a look at the 4th quarter 2020 earnings report Eagle Materials, a manufacturer and distributer of portland cement, gypsum wallboard and concrete, sand and aggregates.
In the face of the COVID-19 pandemic, our management team is focused first and foremost on protecting the safety and health of our employees, customers, and business partners " |
About Eagle Materials
Eagle Materials Inc. manufactures and distributes Portland Cement, Gypsum Wallboard and Recycled Gypsum Paperboard, and Concrete, Sand and Aggregates from more than 75 facilities across the US. Eagle’s corporate headquarters is in Dallas, Texas.
Overview of Eagle Materials 4th quarter 2020 earnings report
The data below refers to the latest quarter unless specified otherwise:
- Revenues: $315.442 million (up strongly from $284.781 million from the same quarter of the previous year)
- Revenues increased by 10.7% over the last 12 months
- Cost of goods sold : $251.529 million (up from $228.119 million for the same quarter of the previous year)
- Cost of goods sold increased by 10.3% over the last 12 months.
- Slight margin gain for Eagle Materials as their revenues grew at a slightly faster pace than their cost of goods sold
- Net income: $72.429 million (up from -$127.797 million for the same quarter of the previous year)
- Diluted earnings per share: $1.74 (up from -$2.82 for the same quarter of the previous year)
- PE ratio of Eagle Materials: 8.4
- Diluted weighted-average shares outstanding: 41.554 million (down from 45.280 million for the same quarter of the previous year)
- Cash and cash equivalents: $118.648 million
- Cash and cash equivalents per share: $2.86
- Cash and cash equivalents makes up 4.74% of Eagle Materials market capital
- Cash and cash equivalents makes up 4% of Eagle Materials total assets
- Stockholders equity in Eagle Materials: $967.843 million
- Stockholders equity per Eagle Materials share: $23.29
- Eagle Materials is trading at 2.58 times its shareholders equity which is well within the expected range of between 2 and 4 times that most firms tend to trade at
- For some perspective the average price to book ratio of firms in the S&P 500 is 3.7. Read more about the S&P 500 here.
Eagle Materials' management commentary on their 4th quarter 2020 earnings report
DALLAS--(BUSINESS WIRE)--May 19, 2020-- Eagle Materials Inc. (NYSE: EXP) today reported financial results for fiscal year 2020 and the fiscal fourth quarter ended March 31, 2020. Notable items for the fiscal year and quarter are highlighted below. (Unless otherwise noted, all comparisons are with the prior fiscal year or prior year’s fiscal fourth quarter, as applicable.)
Michael Haack, President and Chief Executive Officer, commented, “In the face of the COVID-19 pandemic, our management team is focused first and foremost on protecting the safety and health of our employees, customers, and business partners. We’ve generally been deemed an essential business, and as we continue operations, we are enforcing health and safety protocols that meet or exceed CDC guidelines.”
Michael Haack, President and Chief Executive Officer, commented, “In the face of the COVID-19 pandemic, our management team is focused first and foremost on protecting the safety and health of our employees, customers, and business partners. We’ve generally been deemed an essential business, and as we continue operations, we are enforcing health and safety protocols that meet or exceed CDC guidelines.”
Commenting on the financial results, Mr. Haack said, “Having achieved record results in fiscal 2020, we entered this crisis period in a strong financial position, and we are taking prudent actions to sustain the financial health of our business. In light of the risks posed by the COVID-19 pandemic and its possible future effects on our business, we are managing our balance sheet and cash flow for stability today and in the future. We are limiting capital spending to critical projects only, managing inventory levels to improve working capital, and taking additional steps such as suspending share repurchases and future dividends to maximize free cashflow. The sale of our concrete and aggregates business in Northern California announced on April 17, coupled with the carryback treatment of our net operating loss, will increase our near-term liquidity considerably.”
Mr. Haack concluded, “I want to thank our dedicated employees for their extraordinary efforts and focus during this unprecedented time. We have a long history of managing through challenging market conditions, and I am confident we will successfully navigate through this difficult period.”
Mr. Haack concluded, “I want to thank our dedicated employees for their extraordinary efforts and focus during this unprecedented time. We have a long history of managing through challenging market conditions, and I am confident we will successfully navigate through this difficult period.”
Eagle Materials (NASDAQ: EXP) stock price history
The image below, obtained from Google, shows the stock price history of Eagle Materials (NYSE: EXP) for the last 5 years. And its not been a very good time for Eagle Materials stockholders. 5 years ago the stock was trading around $14,40 and today its trading at $43,55. That's a more than decent return of 202% provided to Weibo stockholders over the last 5 years. The stock of Weibo is currently trading at a lot closer to its 52 week low of $34.36 than it is to its 52 week high of $74.68 which to us is a clear indication that the short term sentiment and momentum of Weibo stock is negative.
Recent Google search trends for Eagle Materials stock price and EXP stock price
The graphic above shows the trends in Google searches for Weibo stock price and WB stock price in the United States over the last 12 months as obtained from Google Trends. As it shows there is pretty limited interest in both google queries. But one would be better off using WB stock price instead of Weibo stock price as there are more searches for this query and you are probably more likely to find the information you want using this search phrase.
Recent coverage of Eagle Materials (NYSE:EXP)
The extract below shows recent coverage of Eagle Materials as obtained from Pitanquarry.com
Eagle Materials experienced significant revenue increases in concrete and aggregate in its latest quarter, ending March 31. The company’s fiscal fourth quarter ended on that date with Eagle reaching a quarterly revenue of $39.5 million in concrete and aggregate. That’s an increase of 39 percent. In addition, fourth-quarter operating earnings in concrete and aggregate were $2.5 million – a 13 percent increase. According to Eagle, the increase reflects improved sales volumes and pricing, as well as the financial results of a concrete and aggregate business Eagle acquired last August.
Eagle’s fiscal 2020 also ended March 31, with the company generating a concrete and aggregate revenue of $181.3 million over the 12-month stretch. Concrete and aggregate revenue was up 31 percent in Eagle’s fiscal year.Also, Eagle says concrete and aggregate reported fiscal 2020 operating earnings of $17.6 million – a 36 percent increase.
Read the full article here
Eagle Materials experienced significant revenue increases in concrete and aggregate in its latest quarter, ending March 31. The company’s fiscal fourth quarter ended on that date with Eagle reaching a quarterly revenue of $39.5 million in concrete and aggregate. That’s an increase of 39 percent. In addition, fourth-quarter operating earnings in concrete and aggregate were $2.5 million – a 13 percent increase. According to Eagle, the increase reflects improved sales volumes and pricing, as well as the financial results of a concrete and aggregate business Eagle acquired last August.
Eagle’s fiscal 2020 also ended March 31, with the company generating a concrete and aggregate revenue of $181.3 million over the 12-month stretch. Concrete and aggregate revenue was up 31 percent in Eagle’s fiscal year.Also, Eagle says concrete and aggregate reported fiscal 2020 operating earnings of $17.6 million – a 36 percent increase.
Read the full article here
Comparing the stock of Eagle Materials (NYSE: EXP) to that of HD Supply (NASDAQ:HDS)
The image below shows the stock price performance of Eagle Materials (NYSE: EXP) and HD Supply (NASDAQ: HDS) over the last 3 years.And from the graph it is clear that the trends in these two companies stock price is very similar, over time, but HD Supply has performed better than Eagle Materials over the last 3 years.
Over the last 3 years the stock of Eagle Materials declined by -37.63% while the stock of HD Supply decreased by -28.74% over the same period of time. So if you had to make a choice three years ago on whether to invest in Eagle Materials or HD Supply we hope you picked HD Supply as the losses suffered by holding it would have been a little less than that of holding Eagle Materials
Eagle Materials (NYSE: EXP) latest stock valuation
So based on the 4th quarter 2020 and full fiscal 2020 earnings report of Eagle Materials (NYSE: EXP) what do we value Eagle Materials stock at? Based on the earnings reported by Eagle Materials our valuation model provides a target price (full value price) for Eagle Materials at $68.10 a stock
We therefore feel that the stock is of Eagle Materials is undervalued at its current price. We usually recommend that long term fundamental or value investors should look to enter the stock at is at least 10% below our target price (full value price) which in this case is $68.10. We therefore believe a good entry point into Eagle Materials stock would be around $61.30 or below.
We expect the stock of Eagle Materials to kick up from current levels to a price closer to our target price (full value price) in coming weeks and months.
We therefore feel that the stock is of Eagle Materials is undervalued at its current price. We usually recommend that long term fundamental or value investors should look to enter the stock at is at least 10% below our target price (full value price) which in this case is $68.10. We therefore believe a good entry point into Eagle Materials stock would be around $61.30 or below.
We expect the stock of Eagle Materials to kick up from current levels to a price closer to our target price (full value price) in coming weeks and months.
Next earnings release of Eagle Materials
It is expected that Eagle Materials will release their 1st quarter 2021 earnings report in mid August 2020