2 Concrete & Aggregates Stocks to Gain From the Infrastructure Boom

Industry Overview - The Zacks Building Products - Concrete & Aggregates industry is poised for steady multi-year growth, driven by strong federal and state infrastructure spending and a rebound in private nonresidential construction [1] - The industry consists of manufacturers, distributors, and sellers of construction materials like aggregates and concrete, serving public infrastructure, residential, and non-residential markets [3] Current Trends - Infrastructure revitalization is a key focus, supported by significant investments from the Infrastructure Investment and Jobs Act and other legislation aimed at enhancing American competitiveness [4] - The industry is experiencing solid pricing power due to limited quarry supply, high barriers to entry, and tight local markets, despite challenges like cost inflation and labor constraints [2][5] Financial Performance - The industry has a Zacks Industry Rank of 87, placing it in the top 36% of over 250 Zacks industries, indicating solid near-term prospects [7][8] - The industry's earnings estimates for 2025 have increased from $2.20 to $2.30 per share, reflecting growing analyst confidence in earnings growth potential [9] Market Performance - Over the past year, the industry has gained 6.8%, outperforming the broader Zacks Construction sector, which declined by 6.9%, but lagging behind the S&P 500's 17.5% gain [11] Valuation Metrics - The industry is currently trading at a forward 12-month price-to-earnings ratio of 24.06X, compared to the S&P 500's 23.74X and the sector's 19.87X [14] Company Highlights - Vulcan Materials Company: This company benefits from resilient end-market demand and disciplined execution, with a projected EPS growth of 11.8% and 16.5% for 2025 and 2026, respectively [18][19] - Martin Marietta: The company is experiencing growth driven by strong infrastructure funding and improving residential trends, with a three-to-five-year expected EPS growth rate of 5.8% [22][24]