If You Invested $1000 in Vulcan Materials a Decade Ago, This is How Much It'd Be Worth Now
How much a stock's price changes over time is important for most investors, since price performance can both impact your investment portfolio and help you compare investment results across sectors and industries.
Another thing that can drive investing is the fear of missing out, or FOMO. This particularly applies to tech giants and popular consumer-facing stocks.
What if you'd invested in Vulcan Materials (VMC) ten years ago? It may not have been easy to hold on to VMC for all that time, but if you did, how much would your investment be worth today?
Vulcan Materials' Business In-Depth
With that in mind, let's take a look at Vulcan Materials' main business drivers.
Based in Birmingham, AL, Vulcan Materials Company is engaged in the production, distribution and sale of construction aggregates and other construction materials in the U.S. and Mexico. As of Dec 31, 2023, it had 404 active aggregates facilities, 71 asphalt facilities, 142 concrete facilities and one calcium facility.
The company has four operating segments going by the principal product lines: Aggregates, Concrete, Asphalt mix and Calcium.
Aggregates (69.1% of 2023 total revenues): The segment produces and sells aggregates like crushed stone, sand and gravel and other aggregates. The segment mainly focuses on the U.S. markets. The end uses of Vulcan’s aggregates include public construction (such as highways, walkways, airport runways, parking lots and railroads) as well as private residential (single-family houses, duplexes, apartment buildings and condominiums) and private non-residential (manufacturing, retail, offices, industrial and institutional) construction. Aggregates inter-segment sales accounted for 6.8% of its total revenues.
Asphalt Mix (14.7%): The Asphalt Mix segment produces and sells asphalt mix in Alabama, Arizona, California, New Mexico, Tennessee and Texas. Aggregates are a significant component in the asphalt mix, comprising approximately 95% of the weight of this product.
Concrete (16.1%): The Concrete segment deals with the production and sale of ready-mix concrete in California, Maryland, New Jersey, New York, Oklahoma, Pennsylvania, Texas, Virginia, the U.S. Virgin Islands, and Washington DC. This segment functions as a customer of the Aggregates segment, as aggregates are a major component in ready-mix concrete (comprising nearly 80% of the weight of this product).
Calcium (0.1%): The Calcium segment is composed of a single operation in Brooksville, FL. This facility produces calcium products for the animal feed, plastics and water treatment industries with high-quality calcium carbonate material mined at the Brooksville quarry.
Bottom Line
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For Vulcan Materials, if you bought shares a decade ago, you're likely feeling really good about your investment today.
According to our calculations, a $1000 investment made in March 2014 would be worth $3,873.64, or a gain of 287.36%, as of March 11, 2024, and this return excludes dividends but includes price increases.
In comparison, the S&P 500 gained 172.82% and the price of gold went up 55.27% over the same time frame.
Analysts are forecasting more upside for VMC too.
Vulcan reported strong results in fourth-quarter 2023, with earnings and revenues surpassing the respective Zacks Consensus Estimate by 7.4% and 0.5%, respectively. Both metrics increased on a year-over-year basis. Consistent strategic execution, the strong performance of the aggregate-led business, and large industrial project demand drove the performance. The company observed modest growth in the public sector during the second half of 2023. It expects demand to accelerate in 2024, with trailing 12-month highway starts surpassing $100 billion and record-level 2024 state budgets. Shares of Vulcan have outperformed its industry in the past six months. Earnings estimates for 2024 have increased in the past 30 days, depicting analysts’ optimism. However, low residential demand and uncertain energy costs are a concern.
Over the past four weeks, shares have rallied 11.13%, and there have been 7 higher earnings estimate revisions in the past two months for fiscal 2024 compared to none lower. The consensus estimate has moved up as well.
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