Vulcan Materials Co (VMC, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $268.69, Vulcan Materials Co has witnessed a daily gain of 0.19%, marked against a three-month change of 6.23%. A thorough analysis, underlined by the GF Score, suggests that Vulcan Materials Co is well-positioned for substantial growth in the near future.
Understanding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 7/10
- Profitability rank: 9/10
- Growth rank: 10/10
- GF Value rank: 5/10
- Momentum rank: 10/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With a high GF Score of 94 out of 100, Vulcan Materials Co signals the highest outperformance potential.
Company Overview: Vulcan Materials Co
Vulcan Materials Co is the United States' largest producer of construction aggregates, including crushed stone, sand, and gravel. Its largest markets include Texas, California, Virginia, Tennessee, Georgia, Florida, North Carolina, and Alabama. In 2023, Vulcan sold 234.3 million tons of aggregates, 13.4 million tons of asphalt mix, and 7.5 million cubic yards of ready-mix. As of December 31, 2022, the company had nearly 16 billion tons of aggregates reserves. With a market cap of $35.48 billion and sales amounting to $7.398 billion, Vulcan Materials Co maintains an operating margin of 18.41%, reflecting its strong market position and operational efficiency.
Financial Strength Breakdown
According to the Financial Strength rating, Vulcan Materials Co's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for Vulcan Materials Co stands impressively at 7.94, underscoring its strong capability to cover its interest obligations. This robust financial position resonates with the wisdom of legendary investor Benjamin Graham, who favored companies with an interest coverage ratio of at least 5. With a favorable Debt-to-Revenue ratio of 0.52, Vulcan Materials Co's strategic handling of debt solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank shows Vulcan Materials Co's impressive standing among its peers in generating profit. Vulcan Materials Co's Operating Margin has increased by 1.85% over the past five years, as shown by the following data: 2020: 18.36; 2021: 16.13; 2022: 13.79; 2023: 17.73; 2024: 18.70. The Piotroski F-Score confirms Vulcan Materials Co's solid financial situation based on Joseph Piotroski's nine-point scale, which measures a company's profitability, funding, and operating efficiency. Vulcan Materials Co's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, Vulcan Materials Co demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 16.9%, which outperforms better than 76.41% of 373 companies in the Building Materials industry. Moreover, Vulcan Materials Co has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 16.8, and the rate over the past five years is 11.4. This trend accentuates the company's continued capability to drive growth.
Conclusion: Vulcan Materials Co's Path to Outperformance
Vulcan Materials Co's financial strength, profitability, and growth metrics, as highlighted by the GF Score, underscore the firm's unparalleled position for potential outperformance. With a strong balance sheet, impressive profitability, and robust growth prospects, Vulcan Materials Co is well-equipped to navigate future challenges and capitalize on opportunities within the construction aggregates industry. For investors seeking companies with strong GF Scores, Vulcan Materials Co presents a compelling case for consideration. GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
