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1. Company Snapshot

1.a. Company Description

Eagle Materials Inc., through its subsidiaries, produces and supplies heavy construction materials and light building materials in the United States.It operates through Cement, Concrete and Aggregates, Gypsum Wallboard, and Recycled Paperboard segments.The company engages in the mining of limestone for the manufacture, production, distribution, and sale of Portland cement; grinding and sale of slag; and mining of gypsum for the manufacture and sale of gypsum wallboards used to finish the interior walls and ceilings in residential, commercial, and industrial structures.


It also manufactures and sells recycled paperboard to gypsum wallboard industry and other paperboard converters, as well as containerboard and lightweight packaging grades.In addition, the company engages in the sale of ready-mix concrete; and mining, extracting, production, and sale of aggregates, including crushed stones, sand, and gravel.Its products are used in commercial and residential construction; public construction projects; and projects to build, expand, and repair roads and highways.


The company was formerly known as Centex Construction Products, Inc.and changed its name to Eagle Materials, Inc.in January 2004.


Eagle Materials Inc.was founded in 1963 and is headquartered in Dallas, Texas.

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1.b. Last Insights on EXP

Eagle Materials Inc.'s recent performance was negatively impacted by its Q2 earnings miss, with quarterly earnings of $4.23 per share, falling short of the Zacks Consensus Estimate of $4.35 per share. Additionally, Bessemer Group Inc. reduced its holdings in the company by 52.9% during the quarter, potentially signaling a loss of investor confidence. Despite a record revenue of $638.9 million, the company's net earnings per diluted share and adjusted EBITDA may not have met investor expectations.

1.c. Company Highlights

2. Eagle Materials' Q2 Fiscal 2026 Earnings: A Strong Performance Amidst Challenges

Eagle Materials reported record revenue of $639 million and earnings per share (EPS) of $4.23 in the second quarter of fiscal 2026. Although EPS was slightly lower than the estimated $4.35, the company's revenue increase was driven by higher cement sales volume and the contribution from recently acquired aggregates businesses. The wallboard segment, however, faced challenges due to reduced demand caused by high interest rates and affordability issues, resulting in a 13% decrease in wallboard sales volume. Despite this, the company saw stability in wallboard pricing.

Publication Date: Nov -03

📋 Highlights
  • Record Revenue & EPS:: Achieved $639M revenue and $4.23 EPS, driven by cement volume growth and new aggregates acquisitions.
  • Cost-Saving Projects:: $430M Wyoming cement plant expansion (25% cost reduction) and Oklahoma wallboard modernization (20% cost cut) underway.
  • Shareholder Returns:: Repurchased $89M shares and paid dividends, returning $97M to shareholders with 45% net debt-to-cap ratio.
  • Demand Outlook:: Cautiously optimistic on cement volume recovery via IIJA funds and private construction, with 2-4% annual growth expected.
  • CapEx & Tax Benefits:: $475–$500M fiscal '26 CapEx for projects; new tax bill enables accelerated depreciation, reducing cash taxes.

Growth Projects and Capital Allocation

The company is progressing with two major growth projects: a $430 million modernization and expansion project at its Laramie, Wyoming cement plant, and a modernization project at its Duke, Oklahoma Wallboard plant. These projects are expected to reduce manufacturing costs by 25% and lower per-unit costs by 20%, respectively. Eagle Materials generated strong cash flow and allocated capital in a disciplined way, repurchasing approximately 396,000 shares for $89 million and paying quarterly dividends, returning a total of $97 million to shareholders in the second quarter.

Outlook and Demand Dynamics

The company remains cautiously optimistic about potential volume recovery in cement and aggregates, citing favorable factors such as the Infrastructure and Jobs Act (IIJA) funds and private nonresidential construction dynamics. According to D. Kesler, "customer conversations indicate improved bidding activity, particularly for private non-residential starts like data centers." Eagle Materials expects to see positive demand in cement continue through its fiscal year and sees a long-term growth opportunity in wallboard demand driven by the need for housing and infrastructure development.

Valuation and Future Prospects

With a P/E Ratio of 11.6 and an EV/EBITDA ratio of 11.84, Eagle Materials' valuation appears reasonable. The company's net debt-to-EBITDA leverage ratio was 1.6x, indicating a manageable debt burden. Analysts estimate next year's revenue growth at 1.4%. The company's focus on operational excellence and investing in assets, network, and people positions it for long-term success.

Capital Expenditure and Tax Implications

Eagle Materials expects capital expenditure to be $475 million to $500 million in fiscal '26, driven by the Mountain Cement and Duke Wallboard plant modernization. The company expects CapEx to decrease to $400 million to $425 million in fiscal '27 and decline further in fiscal '28. The new tax bill allowing for accelerated depreciation will benefit Eagle Materials, a cash taxpayer, with the 2 big projects, as noted by D. Kesler.

3. NewsRoom

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Eagle Materials Inc $EXP Shares Acquired by Aristides Capital LLC

Nov -27

Source: defenseworld.net

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Creative Planning Decreases Stock Position in Eagle Materials Inc $EXP

Nov -26

Source: defenseworld.net

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Eagle Materials Inc $EXP Shares Sold by Creative Planning

Nov -26

Source: defenseworld.net

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Madison Small Cap Fund Q3 2025 Portfolio Activity

Nov -21

Source: seekingalpha.com

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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria WT EXP 030926 (CRESW) Q1 2026 Earnings Call Transcript

Nov -12

Source: seekingalpha.com

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Eagle Materials Declares Quarterly Dividend

Nov -10

Source: businesswire.com

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Bessemer Group Inc. Reduces Stock Holdings in Eagle Materials Inc $EXP

Nov -03

Source: defenseworld.net

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Here's What Key Metrics Tell Us About Eagle Materials (EXP) Q2 Earnings

Oct -30

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.49%)

6. Segments

Cement

Expected Growth: 5%

Eagle Materials Inc.'s cement segment growth is driven by increasing demand from infrastructure projects, residential construction, and repair activities. Additionally, the company's strategic expansion into new markets, cost savings initiatives, and operational efficiencies contribute to its 5% growth rate.

Gypsum Wallboard

Expected Growth: 4%

Eagle Materials Inc.'s Gypsum Wallboard segment growth is driven by increasing demand for new construction and renovation projects, fueled by a strong US housing market and infrastructure development. Additionally, the company's strategic expansion into new markets, cost savings initiatives, and focus on sustainable products contribute to its 4% growth.

Concrete and Aggregates

Expected Growth: 5%

Eagle Materials Inc.'s Concrete and Aggregates segment growth is driven by increasing infrastructure spending, rising demand for residential and commercial construction, and strategic acquisitions. Additionally, the company's focus on operational efficiency, cost savings, and pricing initiatives contribute to its 5% growth rate.

Reconciling Items

Expected Growth: 3%

Eagle Materials Inc.'s 3% growth is driven by increasing demand for construction materials, particularly in the US, fueled by government infrastructure spending and a strong housing market. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth, along with operational efficiencies and cost savings initiatives.

Paperboard

Expected Growth: 4%

Eagle Materials Inc.'s paperboard segment growth is driven by increasing demand for sustainable packaging, rising e-commerce sales, and growing need for lightweight materials. Additionally, the company's strategic acquisitions, operational efficiencies, and cost savings initiatives contribute to its 4% growth rate.

7. Detailed Products

Cement

Eagle Materials Inc. produces high-quality Portland cement for use in various construction projects, including roads, bridges, buildings, and homes.

Concrete and Aggregates

The company offers a range of concrete and aggregate products, including ready-mix concrete, crushed stone, sand, and gravel.

Gypsum Wallboard

Eagle Materials Inc. manufactures and distributes gypsum wallboard for use in building construction and renovation projects.

Recycled Paperboard

The company produces recycled paperboard products, including containerboard and kraft paper, for use in packaging and paper products.

Oil and Gas Proppants

Eagle Materials Inc. supplies frac sand and other proppants for use in hydraulic fracturing operations in the oil and gas industry.

8. Eagle Materials Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Eagle Materials Inc. is medium due to the availability of alternative building materials and the increasing demand for sustainable products.

Bargaining Power Of Customers

The bargaining power of customers for Eagle Materials Inc. is low due to the company's strong brand reputation and the lack of buyer concentration in the industry.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Eagle Materials Inc. is medium due to the presence of multiple suppliers and the company's ability to negotiate prices.

Threat Of New Entrants

The threat of new entrants for Eagle Materials Inc. is low due to the high barriers to entry, including the need for significant capital investment and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry for Eagle Materials Inc. is high due to the presence of several established players in the industry and the ongoing competition for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 45.70%
Debt Cost 5.00%
Equity Weight 54.30%
Equity Cost 10.68%
WACC 8.09%
Leverage 84.16%

11. Quality Control: Eagle Materials Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
NewMarket

A-Score: 6.7/10

Value: 4.5

Growth: 7.2

Quality: 7.2

Yield: 3.0

Momentum: 9.5

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Boise Cascade

A-Score: 5.1/10

Value: 6.8

Growth: 5.8

Quality: 5.6

Yield: 6.0

Momentum: 0.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Steel Dynamics

A-Score: 4.9/10

Value: 3.4

Growth: 7.1

Quality: 5.1

Yield: 2.0

Momentum: 6.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Summit Materials

A-Score: 4.5/10

Value: 1.9

Growth: 5.6

Quality: 4.0

Yield: 1.0

Momentum: 8.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Eagle Materials

A-Score: 4.3/10

Value: 3.7

Growth: 7.6

Quality: 6.1

Yield: 0.0

Momentum: 2.0

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
Knife River

A-Score: 3.4/10

Value: 6.1

Growth: 5.2

Quality: 3.9

Yield: 0.0

Momentum: 2.0

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

221.89$

Current Price

221.89$

Potential

-0.00%

Expected Cash-Flows