Jefferies Cutss Price Target on Martin Marietta Materials (MLM), Top U.S. Company in Sector
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Price: $534.92 +1.84%
Rating Summary:
19 Buy, 12 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
19 Buy, 12 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Jefferies is reaffirming its Buy rating on shares of Martin Marietta Materials (NYSE: MLM), but is lowering its price target from $108 to $104.
The firm highlights that Martin Marietta is its tip pick among the U.S. companies in which they cover in the sector. Due to slowing demand, Jefferies is cutting its 2012 volume estimate from a 5 percent gain to a 1 percent gain, EBITDA from $447 million to $418 million, and its EPS estimate from $3.23 to $2.65.
Currently, Jeffeires is forecasting that aggregate shipments will total 127 million for 2011, which is well below its peak of 203 million in 2005.
Martin Marietta reported a 2.4 percent rise in the average selling price for its aggregates between the second quarter of 2010 and the second quarter of 2011. On 2 August, the company released its outlook for 20111 and announced that it forecasts a 2-4 percent price increase over the full year.
The firm believes that the U.S. aggregate prices will continue to increase above the rate of inflation for a while due to the scarcity value of reserves.
An analyst at Jefferies comments, "This year’s price increases are indicative of the U.S. aggregate industry’s pricing power and we continue to expect real price increases over several years. Volumes have so far been slower to recover than we expected, but when they do we initially expect 50-60% operational leverage."
For more ratings news on Martin Marietta Materials click here and for the rating history of Martin Marietta Materials click here.
Shares of Martin Marietta Materials closed at $70.37 yesterday.
The firm highlights that Martin Marietta is its tip pick among the U.S. companies in which they cover in the sector. Due to slowing demand, Jefferies is cutting its 2012 volume estimate from a 5 percent gain to a 1 percent gain, EBITDA from $447 million to $418 million, and its EPS estimate from $3.23 to $2.65.
Currently, Jeffeires is forecasting that aggregate shipments will total 127 million for 2011, which is well below its peak of 203 million in 2005.
Martin Marietta reported a 2.4 percent rise in the average selling price for its aggregates between the second quarter of 2010 and the second quarter of 2011. On 2 August, the company released its outlook for 20111 and announced that it forecasts a 2-4 percent price increase over the full year.
The firm believes that the U.S. aggregate prices will continue to increase above the rate of inflation for a while due to the scarcity value of reserves.
An analyst at Jefferies comments, "This year’s price increases are indicative of the U.S. aggregate industry’s pricing power and we continue to expect real price increases over several years. Volumes have so far been slower to recover than we expected, but when they do we initially expect 50-60% operational leverage."
For more ratings news on Martin Marietta Materials click here and for the rating history of Martin Marietta Materials click here.
Shares of Martin Marietta Materials closed at $70.37 yesterday.
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