AllAnalyst Report
logoMorningstarMay 11, 2021

Summit Materials, Inc.: Summit Reports Strong Start to 2021 With Solid Q1, but Ongoing Rally Leaves Shares Overvalued

Symbols
SUM
Sector(s)
Basic Materials
Rating
Current Price
$34.27
Fair Value
Economic Moat
Stewardship
Summary

Summit Materials is a top-10 aggregates supplier and top-15 cement producer in the U.S. Founded as a roll-up strategy in 2009, the company has grown through a very active acquisition strategy. While cement and aggregates constituted about 35% of the firm's revenue in 2020, these higher-margin businesses constituted nearly 55% of gross profit. Summit's downstream businesses and services include asphalt, ready-mix concrete, and paving. While these constitute about 65% of revenue, their lower margins lead to gross profit contribution of roughly 45%.

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Analyst Profile

Kristoffer Inton

Director
Kristoffer Inton is director of equity research, basic materials for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He covers gold, aggregates and cement, and uranium companies.Before joining Morningstar in 2013, Inton was an investment banking associate for Guggenheim Securities in New York. Previously, he was an investment banking analyst for Merrill Lynch in Chicago and New York.Inton holds a bachelor’s degree in finance with high honors from the University of Illinois and a master’s degree in business administration with distinction from Northwestern University’s Kellogg School of Management.