Vulcan Materials Company (VMC), Martin Marietta Materials, Inc. (MLM): A Rock-Solid Investment

For fiscal 4Q, Texas Industries, Inc. (NYSE:TXI) notes that…“the fourth quarter certainly benefited from the continuing recovery of construction activity in our major markets. Shipments of all products reflect double-digit percentage increases compared to a year ago.”

However, the stock is still down over 5% during the past month, as weakness in its end markets persists. Analysts expect the company to grow EPS at an annualized rate that’s only 6%.

What’s more is that fiscal 2014 EPS is still expected to come in on the negative side, a loss of $0.04 per share for the year. Fiscal 2015 is expected to be positive at $1.64, putting its forward P/E at a relatively high 37 times.

Bottom line

All in all, the major aggregates companies should be big benefactors of the rebound in the economy. This includes strong residential and commercial construction markets. As well, strong spending on infrastructure is another positive.

The best bet on the industry appears to be Martin Marietta Materials, Inc. (NYSE:MLM), trading with a P/E that’s half of Vulcan Materials Company (NYSE:VMC), and Martin pays a 1.6% dividend yield compared to Vulcan’s 0.1%. As well, Texas Industries, Inc. (NYSE:TXI) is still behind its peers in the turnaround and is expected to grow EPS below Vulcan and Martin.