Core Viewpoint - Eagle Materials Inc. is experiencing a decline in earnings outlook, resulting in a Zacks Rank 5 (Strong Sell) due to a long-term trend of negative earnings revisions [1][4][6]. Company Overview - Eagle Materials is a leading U.S. manufacturer of heavy construction products and light building materials, primarily producing Portland Cement and Gypsum Wallboard, essential for various construction projects [2]. Recent Performance - The company has shown impressive growth over the past 15 years, but is currently facing near-term headwinds that are negatively impacting earnings, particularly due to a challenging residential construction market [3]. Earnings Estimates - The Q4 FY26 earnings estimate has decreased by 11% since the late January earnings release, with FY26 estimates down 5% and the 2027 outlook reduced by 7%, indicating a prolonged trend of negative revisions [4]. Market Outlook - Despite current challenges, Eagle Materials is positioned to benefit from the U.S. infrastructure boom and is expected to see a rebound in the housing market, as noted by the CEO in Q3 earnings comments regarding elevated spending on public infrastructure and private non-residential construction [7].

Core Insights - Eagle Materials reported solid performance in fiscal Q3 2026, with revenue of $556 million and earnings per share of $3.22, despite a mixed construction environment [4] - The heavy materials sector saw an 11% revenue increase, driven by a 9% rise in cement sales volume and a significant 81% increase in aggregate sales volume [2][6] - The company is focused on operational efficiency, cost control, and maintaining a strong balance sheet while navigating a challenging market [3][19] Financial Performance - Revenue for the quarter was $556 million, with a gross profit margin of 28.9% [4][6] - Operating earnings in heavy materials increased by 9%, while light materials experienced a 16% revenue decline to $203 million, primarily due to lower wallboard volumes and pricing [2][8] - The company returned nearly $150 million to shareholders through dividends and share repurchases during the quarter [18] Market Trends - Demand trends in Eagle's markets are broadly positive, supported by infrastructure spending and growth in non-residential sectors like data centers [1] - Wallboard demand is under pressure due to a challenging residential construction environment, with a noted 14% shipment decline across the company's footprint [11][9] - Cement pricing is expected to increase by approximately $8 per ton in most markets, with timing varying regionally [6] Operational Initiatives - The company is implementing operational initiatives to enhance its position as a low-cost producer, including recycling waste streams and modernizing facilities [14][15] - Major plant modernizations are underway, with the Mountain Cement plant expected to be commissioned late in the current calendar year and the Duke facility in the second half of 2027 [20] Capital Management - Eagle issued $750 million in 10-year notes at a 5% interest rate to strengthen its capital structure and improve liquidity, now totaling approximately $1.2 billion [5][16] - As of December 31, 2025, the company reported a net debt-to-EBITDA ratio of 1.8x and no significant near-term debt maturities [17]

Core Viewpoint - Eagle Materials reported a slight decline in revenue for the quarter ended December 2025, with a revenue of $555.96 million, down 0.4% year-over-year, and an EPS of $3.22, compared to $3.59 in the same quarter last year, indicating mixed performance against Wall Street expectations [1]. Financial Performance - Revenue of $555.96 million was slightly above the Zacks Consensus Estimate of $553.98 million, resulting in a surprise of +0.36% [1]. - The company experienced an EPS surprise of -2.92%, with the consensus EPS estimate being $3.32 [1]. - Over the past month, shares of Eagle Materials returned +5.4%, outperforming the Zacks S&P 500 composite's +0.8% change [3]. Key Metrics - Average Net Sales Price for Gypsum Wallboard was $225.19, below the estimated $233.73 [4]. - Average Net Sales Price for Cement was $154.52, compared to the estimated $156.03 [4]. - Revenue from Light Materials - Gypsum Wallboard was $175.87 million, significantly lower than the estimated $191.51 million, representing a -16.1% change year-over-year [4]. - Total Revenue from Light Materials was $203.46 million, below the $221.93 million average estimate, reflecting a -15.8% year-over-year change [4]. - Total Revenue from Heavy Materials was $352.5 million, exceeding the average estimate of $320.44 million, with a year-over-year change of +11.5% [4]. - Revenue from Heavy Materials - Concrete & Aggregates was $69 million, surpassing the estimated $61.37 million, showing a +22.3% change year-over-year [4]. - Revenue from Heavy Materials - Cement (Wholly Owned) was $283.5 million, compared to the $259.07 million average estimate, indicating a +9.1% year-over-year change [4]. Segment Operating Earnings - Segment Operating Earnings for Light Materials - Gypsum Wallboard was $61.36 million, below the average estimate of $73.41 million [4]. - Segment Operating Earnings for Light Materials - Recycled Paperboard was $11.25 million, slightly above the estimated $10.87 million [4]. - Total Segment Operating Earnings for Light Materials was $72.6 million, below the average estimate of $84.28 million [4]. - Segment Operating Earnings for Heavy Materials - Cement was $91.34 million, exceeding the average estimate of $84.37 million [4]. - Segment Operating Earnings for Heavy Materials - Concrete and Aggregates was $1.38 million, below the average estimate of $4.83 million [4].

January 29, 2026 Third Quarter Fiscal 2026 Earnings Release and Conference Call Forward-Looking Statements Forward-Looking Statements. This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the context of the statements and generally arise when the Company is discussing its beliefs, estimat ...

Core Insights - Eagle Materials Inc. reported strong financial results for the third quarter of fiscal 2026, with revenue of $556 million, adjusted EBITDA of $190.1 million, and earnings per share (EPS) of $3.22, despite challenges in the residential construction market [1][2]. Financial Performance - Revenue for the third quarter increased by 11% in the Heavy Materials sector to $390.2 million, driven by higher sales volumes of Cement and Aggregates [1]. - Cement sales volume rose by 9% to 1.9 million tons, while organic Aggregates sales volume surged by 34% [1][2]. - Light Materials sector revenue decreased by 16% to $203.5 million, attributed to lower sales volumes and prices of Gypsum Wallboard and Recycled Paperboard [1][2]. Capital Structure and Shareholder Returns - The company issued $750 million in 10-year senior notes at a 5.00% interest rate, enhancing liquidity and extending debt maturity [1]. - Nearly $150 million was returned to shareholders through dividends and share repurchases, with approximately 648,000 shares repurchased [1][2]. Operational Efficiency and Investments - Eagle Materials is investing in modernizing its Cement and Gypsum Wallboard plants to improve operational efficiency and lower costs [1]. - The company reported a net leverage ratio of 1.8x, indicating substantial financial flexibility for future growth [1][2]. Segment Analysis - Heavy Materials segment operating earnings increased by 9% to $92.7 million, reflecting strong demand for Cement and Aggregates [1]. - Light Materials segment operating earnings decreased by 25% to $72.6 million due to lower sales volumes and pricing pressures [1][2]. Market Position - The company maintains a strong market position supported by federal, state, and local spending on public infrastructure projects, which has bolstered demand for its Heavy construction products [1][2].

Core Viewpoint - Eagle Materials (EXP) is expected to report a decline in quarterly earnings and revenues, indicating potential challenges in its financial performance [1]. Earnings Estimates - Wall Street analysts predict quarterly earnings of $3.39 per share, a decrease of 5.6% year-over-year [1]. - The consensus EPS estimate has been revised down by 3.5% in the past 30 days, reflecting a reassessment by covering analysts [2]. Revenue Projections - Total revenues are forecasted to be $556.73 million, showing a slight year-over-year decrease of 0.2% [1]. - Revenue from Gypsum Wallboard is expected to reach $192.79 million, indicating an 8% decline from the previous year [5]. - Revenue from Light Materials - Gypsum Paperboard is estimated at $30.42 million, down 5.6% year-over-year [5]. - Total Revenue from Light Materials is projected at $221.93 million, reflecting an 8.2% decrease [5]. - Revenue from Heavy Materials - Concrete & Aggregates is expected to be $61.37 million, showing an 8.8% increase from the prior year [6]. - Total Revenue from Heavy Materials is projected at $320.44 million, indicating a 1.3% year-over-year increase [6]. Price Estimates - The consensus estimate for Average Net Sales Price - Gypsum Wallboard is $233.73, down from $236.11 in the same quarter last year [7]. - Average Net Sales Price - Cement is expected to be $156.03, slightly lower than the previous year's $156.82 [8]. Segment Operating Earnings - Segment Operating Earnings for Light Materials - Gypsum Wallboard is projected at $73.41 million, down from $86.39 million in the same quarter last year [8]. - Segment Operating Earnings for Light Materials - Recycled Paperboard is expected to be $10.87 million, slightly lower than last year's $11.04 million [9]. - The consensus for Segment Operating Earnings - Light Materials is $84.28 million, down from $97.43 million in the same quarter last year [9]. Stock Performance - Over the past month, shares of Eagle Materials have increased by 4.3%, outperforming the Zacks S&P 500 composite, which rose by 0.4% [11]. - Currently, Eagle Materials holds a Zacks Rank 4 (Sell), indicating potential underperformance in the near future [11].

Company Overview - Eagle Materials is a leading U.S. supplier of essential construction materials, with a diversified portfolio that includes cement, aggregates, wallboard, and recycled paperboard [4] - The company serves a broad base of customers in residential, commercial, and public infrastructure markets, leveraging vertical integration and regional scale [5] Financial Performance - As of November 14, 2025, Eagle Materials has a market capitalization of $6.63 billion, revenue of $2.30 billion, and net income of $446.80 million [3] - The stock price on November 14, 2025, was $202.06, reflecting a 33.6% decline over the past year, underperforming the S&P 500 by 46.7 percentage points [2][6] Recent Developments - L1 Capital International sold its entire $19.1 million stake in Eagle Materials, which constituted 4.7% of its 13F assets at the end of the second quarter [1][2] - The company missed earnings estimates for the second quarter of FY 2026, with wallboard volumes declining 5% in the first half due to softening demand from the residential construction sector [9] Market Trends - The U.S. housing market has softened since 2024, leading to a revenue growth decline from mid-teens in FY 2023 to zero growth in FY 2025 [7] - Elevated mortgage interest rates continue to raise concerns about housing affordability, impacting residential construction activity [9] Growth Opportunities - Despite challenges in the residential segment, Eagle's non-residential segments have shown solid growth, supported by government infrastructure projects and increased private spending [10] - The stock is currently trading at 16.3 times its trailing 12-month earnings and a price-to-sales ratio of 3.2, indicating it remains within its five-year ranges and may present a hidden gem for long-term investors [10][11]

Core Thesis - Eagle Materials Inc. is positioned to weather downturns in the housing market due to its diversified operations and strong financial discipline, despite current challenges in the gypsum wallboard segment [3][4][5] Company Overview - Eagle Materials Inc. manufactures and sells heavy construction products and light building materials in the United States, with a focus on cement and aggregates [2] - As of November 28th, the company's share price was $223.72, with trailing and forward P/E ratios of 16.49 and 14.08 respectively [1] Market Conditions - The company is facing a challenging housing backdrop, with weak homebuilding activity impacting its gypsum wallboard segment, while cement and aggregates operations are experiencing steady growth [2] - Cement volumes increased by 8%, and a recent acquisition in aggregates contributed to quarter-over-quarter gains, although these were not sufficient to offset declines in wallboard volumes and pricing [2] Financial Resilience - Despite cyclical pressures, Eagle Materials continues to generate solid cash flow, allowing for buybacks, dividends, and strategic reinvestment [3] - The company benefits from ownership of its own gypsum and limestone reserves, providing a structural cost advantage [3] Strategic Opportunities - The current downturn allows management to deploy capital more efficiently as competitors weaken, positioning the company for stronger long-term performance [4] - Maintenance and facility upgrades are expected to enhance Eagle's competitive edge when the housing market rebounds [4] Historical Context - A previous bullish thesis highlighted the company's localized market dominance and vertical integration, although the stock price has depreciated approximately 6.75% since then due to ongoing housing weakness [5] - The investment thesis remains valid as Eagle is structurally advantaged, with emphasis on cyclical pressures and capital deployment opportunities [5]

Core Insights - Saint-Gobain Canada has completed its expansion and sustainable upgrade project at the CertainTeed Gypsum plant in Sainte-Catherine, Quebec, making it North America's first zero-carbon gypsum wallboard plant and the largest globally [1] Company Developments - The project was first announced in 2022 and involved significant electrification upgrades [1] - The plant is now solely powered by renewable electricity, highlighting the company's commitment to sustainability [1]

Core Insights - Eagle Materials reported revenue of $634.69 million for the quarter ended June 2025, marking a year-over-year increase of 4.3% and a surprise of +4.64% over the Zacks Consensus Estimate of $606.57 million [1] - The company's EPS for the same period was $3.76, compared to $3.94 a year ago, with an EPS surprise of +0.8% against the consensus estimate of $3.73 [1] Financial Performance Metrics - Average Net Sales Price for Gypsum Wallboard was $232.40, below the estimated $238.22 [4] - Average Net Sales Price for Cement was $156.72, also below the estimated $159.24 [4] - Revenue from Heavy Materials - Concrete & Aggregates was $73.72 million, exceeding the average estimate of $67.04 million, representing a year-over-year change of +20.8% [4] - Revenue from Light Materials - Gypsum Paperboard was $29.13 million, slightly below the estimated $29.51 million, reflecting a -3.7% change year-over-year [4] - Total Revenue from Heavy Materials was $384.04 million, surpassing the estimated $366.11 million, with a year-over-year increase of +6.5% [4] - Revenue from Heavy Materials - Cement (Wholly Owned) was $310.33 million, exceeding the estimate of $298.09 million, with a year-over-year increase of +3.6% [4] - Revenue from Light Materials - Gypsum Wallboard was $221.52 million, above the estimated $207.66 million, showing a year-over-year change of +1.7% [4] - Total Revenue from Light Materials was $250.65 million, exceeding the estimated $237.17 million, with a year-over-year increase of +1% [4] Segment Operating Earnings - Segment Operating Earnings for Light Materials - Recycled Paperboard was $9.5 million, above the estimated $9.19 million [4] - Segment Operating Earnings for Light Materials - Gypsum Wallboard was $92.64 million, compared to the average estimate of $87.16 million [4] - Total Segment Operating Earnings for Light Materials was $102.14 million, exceeding the average estimate of $96.35 million [4] - Segment Operating Earnings for Heavy Materials - Cement (Wholly Owned) was $77.28 million, below the average estimate of $80.69 million [4] Stock Performance - Shares of Eagle Materials have returned +9.3% over the past month, outperforming the Zacks S&P 500 composite's +3.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]