Vulcan (VMC) to Report Q3 Earnings: Here's What to Expect
Vulcan Materials Company VMC is scheduled to release third-quarter 2023 results on Oct 26 before the opening bell.
In the last reported quarter, the company’s adjusted earnings and revenues topped the Zacks Consensus Estimate by 19.9% and 2.5%, respectively. On a year-over-year basis, earnings and revenues increased by 49.7% and 8.1%, respectively.
Vulcan Materials’ earnings topped the consensus mark in three of the last five quarters and missed on the other two occasions.
The Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share has been revised upward to $2.22 from $2.21 over the past 30 days. The estimated figure indicates a rise of 24.7% from the year-ago quarter.
Vulcan Materials Company Price and EPS Surprise
Vulcan Materials Company price-eps-surprise | Vulcan Materials Company Quote
The consensus estimate for revenues is pegged at $2.17 billion, suggesting 4% year-over-year growth.
Factors to Note
Higher spending from several states is likely to have helped Vulcan generate higher revenues and earnings in the third quarter of 2023. Higher non-residential construction activities and incremental federal funding from the Infrastructure Investment and Jobs Act are supposed to have acted as a tailwind for VMC. Also, resilient pricing across its product lines is expected to have supported the growth.
The Aggregates business, including crushed stone, sand and gravel and other aggregates (accounting for 74.7% of total second-quarter revenues), has been a major contributor to top-line growth.
Our model suggests net sales from the Aggregates segment to grow 7.4% to $1,601.2 million from a year ago.
However, reduced residential demand due to lower permits and starts in single-family homes, along with higher material expenses, the shortage of skilled laborers and rising wage costs, are expected to have impacted VMC’s third-quarter results. Also, supply-related woes and significant fluctuations in the prices of various resources may have been risks.
Our model suggests net sales from the Asphalt Mix segment (16% of total revenues) to be $295.5 million, indicating a 4.7% decline from a year ago. We also anticipate revenues from the Concrete segment (16.3% of total revenues) to decline 9.8% to $406.5 million from a year ago.
The Calcium segment’s net sales are expected to be $2.7 million, suggesting growth from $2.1 million a year ago.
We also predict Aggregates volumes to decline 2.7% year over year, whereas volumes for Asphalt Mix and Concrete units are likely to grow 5.4% and 14.3% year over year, respectively.
Efforts to enhance operational excellence, acquisition synergies and cost-control measures are expected to have aided the bottom line.
What Our Quantitative Model Predicts
Our proven model predicts an earnings beat for Vulcan this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is the case here, as you will see below.
Earnings ESP: It has an Earnings ESP of +0.48%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #2.
Other Stocks With the Favorable Combination
Here are some other companies in the Zacks Construction sector that, according to our model, have the right combination of elements to post an earnings beat in the quarter to be reported.
KBR, Inc. KBR has an Earnings ESP of +6.36% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
KBR’s earnings topped the consensus mark in all the last four quarters, the average being 10.8%. Earnings for the to-be-reported quarter are expected to increase 12.3% year over year.
Construction Partners, Inc. ROAD has an Earnings ESP of +2.91% and a Zacks Rank #1.
ROAD’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average being 10.6%. Earnings for the to-be-reported quarter are expected to rise 108% year over year.
Dycom Industries, Inc. DY has an Earnings ESP of +1.24% and a Zacks Rank #2.
DY’s earnings topped the consensus mark in all the last four quarters, the average being 147.4%. Earnings for the to-be-reported quarter are expected to grow 4.7% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Vulcan Materials Company (VMC) : Free Stock Analysis Report
KBR, Inc. (KBR) : Free Stock Analysis Report
Dycom Industries, Inc. (DY) : Free Stock Analysis Report
Construction Partners, Inc. (ROAD) : Free Stock Analysis Report
