Financial Review: Eagle Materials (EXP) versus Its Competitors

Eagle Materials (NYSE:EXP) is one of 74 publicly-traded companies in the “Construction Materials” industry, but how does it contrast to its peers? We will compare Eagle Materials to similar businesses based on the strength of its dividends, earnings, valuation, profitability, analyst recommendations, risk and institutional ownership.

Analyst Ratings

This is a breakdown of current ratings and target prices for Eagle Materials and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eagle Materials	0	9	1	0	2.10
Eagle Materials Competitors	404	2048	2828	83	2.48

Eagle Materials presently has a consensus target price of $223.44, indicating a potential upside of 4.30%. As a group, “Construction Materials” companies have a potential upside of 435.55%. Given Eagle Materials’ peers stronger consensus rating and higher probable upside, analysts plainly believe Eagle Materials has less favorable growth aspects than its peers.

Volatility and Risk

Eagle Materials has a beta of 1.38, suggesting that its stock price is 38% more volatile than the S&P 500. Comparatively, Eagle Materials’ peers have a beta of 0.90, suggesting that their average stock price is 10% less volatile than the S&P 500.

Valuation & Earnings

This table compares Eagle Materials and its peers gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Eagle Materials	$2.31 billion	$423.81 million	16.93
Eagle Materials Competitors	$6.77 billion	$651.37 million	32.48

Eagle Materials’ peers have higher revenue and earnings than Eagle Materials. Eagle Materials is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Eagle Materials and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eagle Materials	17.32%	26.87%	10.73%
Eagle Materials Competitors	4.78%	8.28%	5.03%

Institutional & Insider Ownership

96.1% of Eagle Materials shares are owned by institutional investors. Comparatively, 46.5% of shares of all “Construction Materials” companies are owned by institutional investors. 1.7% of Eagle Materials shares are owned by company insiders. Comparatively, 9.9% of shares of all “Construction Materials” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Eagle Materials pays an annual dividend of $1.00 per share and has a dividend yield of 0.5%. Eagle Materials pays out 7.9% of its earnings in the form of a dividend. As a group, “Construction Materials” companies pay a dividend yield of 177.1% and pay out 31.6% of their earnings in the form of a dividend.

Summary

Eagle Materials peers beat Eagle Materials on 9 of the 15 factors compared.

Eagle Materials Company Profile

Eagle Materials Inc., through its subsidiaries, manufactures and sells heavy construction materials and light building materials in the United States. It operates in four segments: Cement, Concrete and Aggregates, Gypsum Wallboard, and Recycled Paperboard. The company engages in the mining of limestone for the manufacture, production, distribution, and sale of Portland cement, including Portland limestone cement; grinding and sale of slag; and mining of gypsum for the manufacture and sale of gypsum wallboards used to finish the interior walls and ceilings in residential, commercial, and industrial structures, as well as well as containerboard and lightweight packaging grades; manufacture and sale of recycled paperboard to the gypsum wallboard industry and other paperboard converters; the sale of readymix concrete; and mining and sale of aggregates, such as crushed stone, sand, and gravel. Its products are used in commercial and residential construction; public construction projects to build, expand, and repair roads and highways; and repair and remodel activities. The company was formerly known as Centex Construction Products, Inc. and changed its name to Eagle Materials, Inc. in January 2004. Eagle Materials Inc. was founded in 1963 and is headquartered in Dallas, Texas.