Today's Post-Market Laggard Is Eagle Materials (EXP)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Eagle Materials ( EXP) as a post-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Eagle Materials as such a stock due to the following factors:

  • EXP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $55.9 million.
  • EXP is down 3.7% today from today's close.

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More details on EXP:

Eagle Materials Inc. manufactures and distributes building products used in residential, industrial, commercial, and infrastructure construction in the United States. The company operates in four segments: Cement, Gypsum Wallboard, Recycled Paperboard, and Concrete and Aggregates. The stock currently has a dividend yield of 0.5%. EXP has a PE ratio of 37.8. Currently there are 2 analysts that rate Eagle Materials a buy, no analysts rate it a sell, and 3 rate it a hold.

The average volume for Eagle Materials has been 671,800 shares per day over the past 30 days. Eagle has a market cap of $4.1 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 2.00 and a short float of 2.9% with 1.93 days to cover. Shares are up 5.8% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Eagle Materials as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year, impressive record of earnings per share growth and compelling growth in net income. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 5.8%. Since the same quarter one year prior, revenues rose by 38.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.49, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.00, which illustrates the ability to avoid short-term cash problems.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • EAGLE MATERIALS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, EAGLE MATERIALS INC increased its bottom line by earning $1.24 versus $0.43 in the prior year. This year, the market expects an improvement in earnings ($2.56 versus $1.24).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Construction Materials industry. The net income increased by 75.9% when compared to the same quarter one year prior, rising from $17.98 million to $31.62 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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