Last Updated: 09 Nov 2024
Executive Summary
Summit Materials Inc. (SUM), a leading producer of building materials, is currently trading at $50.41. Analysts have a positive outlook on the company, with a consensus target price of $53.02. Strong buy and buy ratings dominate analyst sentiment, indicating their belief in the company's long-term growth potential.
Company Overview
Summit Materials is a vertically integrated company that produces aggregates, asphalt, cement, and ready-mix concrete. The company operates in over 40 states and has a strong presence in the Western United States. Summit Materials serves a diverse customer base, including contractors, homebuilders, and government agencies.
Fundamental Analysis
Summit Materials has delivered strong financial performance in recent years. Revenue has grown steadily, reaching $3.75 billion in the trailing twelve months (TTM). The company's profit margin is 3.93%, and its operating margin is 17.5%. Summit Materials has a strong balance sheet, with an EBITDA of $842.6 million and a book value of $25.32 per share.
The company's earnings per share (EPS) is $0.85 TTM, and its trailing price-to-earnings (PE) ratio is 60. While this PE ratio is relatively high, it is in line with the industry average. Summit Materials does not currently pay a dividend.
Technical Analysis
Technically, Summit Materials is trading above its 50-day and 200-day moving averages, indicating a bullish trend. The stock has recently broken out of a resistance level at $50, suggesting further upside potential.
Short Term Outlook
In the short term, Summit Materials is expected to continue to benefit from strong demand for building materials. The company's recent acquisition of CalPortland Company will further expand its market reach and product offerings. Analysts expect the company to deliver solid earnings growth in the coming quarters.
Long Term Outlook
The long-term outlook for Summit Materials is positive. The company is well-positioned to benefit from the growing demand for infrastructure spending. Summit Materials has a strong track record of innovation and is committed to sustainability. The company's focus on environmental stewardship and social responsibility should enhance its long-term growth prospects.
Analyst Recommendations
Analysts are overwhelmingly positive on Summit Materials. Out of 17 analysts covering the stock, 6 have issued strong buy ratings, 7 have issued buy ratings, 4 have issued hold ratings, and none have issued sell or strong sell ratings. The consensus target price is $53.02, representing a potential upside of 5.18%.
