VULCAN MATERIALS COMPANY (VMC): what the price assumes

In the published model solve dated 2026-Q2, anchored at $274.51, VULCAN MATERIALS COMPANY (VMC) is priced for +20.4% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-28.

Generated: 2026-08-30 · Source: https://boothcheck.com/report/VMC

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 8.7% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.2%); the inversion above states its own rate.

Per-Model Detail (n=14)

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

Bullet Takeaways

• Vulcan is the largest US producer of construction aggregates, with crushed stone, sand and gravel at about 73% of the business and asphalt and concrete making up the rest. Q1 2026 revenue rose 7% to $1.76 billion, EPS of $1.35 beat the $1.12 consensus by more than 20%, and gross margin expanded 180 basis points to 24.1%.

• The franchise is a pricing machine. Aggregates shipped 50.0 million tons at a freight-adjusted price of $22.80 a ton, and full-year guidance calls for 4% to 6% pricing growth on top of low-single-digit volume growth, with adjusted EBITDA guided to $2.4 to $2.6 billion.

• The price asks a lot for that quality. At $302.81 the market is paying about 31 times operating income, which embeds operating growth held at its self-funding ceiling for roughly six years. The business is excellent; the question is whether even an excellent aggregates franchise grows fast enough, for long enough, to justify the multiple.

Bull Case

Start with what the market is pricing in, then set it against the fundamentals, because for Vulcan the gap is smaller than the headline multiple suggests. The price embeds operating growth at the company's self-funding ceiling for about six years, which sounds aggressive until you look at the pricing engine underneath. Aggregates are the closest thing in industrials to a local monopoly: rock is heavy and cheap relative to the cost of moving it, so a quarry effectively owns the customers within trucking distance. Vulcan's own 10-K makes the point that each operation is defined by its location within a local market and its particular geology, and that intersegment rock is transferred at local market prices. That is the language of a business that sets price locally rather than competing it away.

The fundamentals are delivering exactly what the price needs. Q1 2026 revenue rose 7% to $1.76 billion, EPS of $1.35 beat by more than 20%, and gross margin expanded 180 basis points to 24.1%, while aggregates moved 50.0 million tons at a freight-adjusted $22.80 a ton. Crucially, the growth is price-led: full-year guidance is for 4% to 6% pricing growth against just 1% to 3% volume growth, which combined with disciplined unit costs should push high-single-digit growth in cash gross profit per ton. Pricing that runs ahead of volume is the most durable kind of growth a cyclical can have, because it does not depend on the construction cycle cooperating every year.

The demand backdrop extends the runway. Public construction remains strong on infrastructure funding, private demand is improving, and a new structural driver has arrived: data-center construction, with roughly 650 million square feet under way or announced, is aggregates-intensive. Vulcan is positioned to capture it, with about 60% of all large public and private projects sitting within 50 miles of a Vulcan facility. With interest covered about seven times and a share count that has slowly shrunk, the company can fund its growth and still return cash. The analyst consensus is a buy, the average target sits around the current price with high-end targets near $355, and the bull case is that a near-monopoly pricing franchise with a lengthening demand runway earns the premium the market is paying.

Bear Case

The cleanest bear argument is about capital allocation and the price of growth, because Vulcan has built its scale partly by buying it. The aggregates leaders grow by acquiring quarries and reserves, and doing so has left Vulcan with net debt of about $5.8 billion, roughly 3.5 times trailing operating income. That is manageable while the cycle is strong and interest is covered seven times, but it is real leverage on a cyclical business, and it means a chunk of the franchise's value was paid for at acquisition multiples that the company now has to earn back through pricing. When management is buying reserves and the stock trades at 31 times operating income, every capital decision, whether to acquire, to buy back stock near record prices, or to deleverage, has to clear a high bar to add value rather than simply chase scale.

The valuation itself is the harder problem. At 31 times operating income the price embeds growth at the self-funding ceiling for about six years, and the earnings-power family in the X-ray lands at roughly a fifth of the price. That is an enormous gap for a business whose growth ultimately rests on pricing 4% to 6% a year. Aggregates pricing has been remarkable, but it is not guaranteed to continue at that pace forever, and the sector is already showing cracks in confidence: peer Martin Marietta was downgraded on narrowing aggregate price realization and moderating infrastructure bid activity, and analysts have trimmed its fair-value estimate on more conservative growth and margin assumptions. The same questions apply to Vulcan, and 42% of analysts already sit on hold.

Finally, the volume side is cyclical no matter how good the pricing is. Guidance assumes only 1% to 3% volume growth, and that rests on public construction funding staying robust and private and residential demand recovering. A pullback in infrastructure spending, a higher-for-longer rate environment that delays private projects, or a softer data-center build than the 650-million-square-foot pipeline implies would slow volumes just as the price is counting on a long, smooth growth runway. Pay a peak-quality multiple on a cyclical, and the downside is that both the multiple and the volumes compress at the same time, which is precisely when the leverage stops being a footnote.

Valuation

Vulcan is a textbook case of a high-quality business priced for a long, uninterrupted run. At $302.81 (June 28, 2026) the market is paying about 31 times company-wide operating income, which under an 8.9% cost of capital solves to operating growth held at the self-funding ceiling for roughly six years. That spread is the signature of a durability premium, the market paying for compounding that the snapshot methods structurally cannot capture.

The premium is not irrational given what aggregates are. A 20.6% operating margin, guided pricing of 4% to 6% a year, and a near-captive position in each local market are the kind of economics that justify a multiple well above a typical cyclical. The reliability on this solve is reasonable. One measurement note belongs in view: the trailing operating income diverges by more than 10% across the two bases here, about $1.66 billion on the EDGAR basis versus $1.45 billion on the record basis, so the precise multiple depends on which trailing window you use; neither is wrong, they are different bases.

The honest read is that the entry price already capitalizes the pricing franchise close to perfection. The implied six-year run at the growth ceiling leaves little margin for a pricing slowdown or a volume air pocket, and the sector's own messengers, with a peer downgraded on narrowing price realization, suggest the pricing tailwind may be maturing. The analyst consensus captures the tension: a buy rating with an average target around the current price and a high end near $355, but with 42% of analysts on hold. The conclusion is that you are paying full price for a genuinely excellent business, so the return depends on the pricing engine running for as long as the multiple assumes rather than on any discount at entry.

Catalysts

The recurring catalyst is aggregates pricing and volume. Q1 2026 set the pace: revenue up 7% to $1.76 billion, EPS of $1.35 beating consensus by more than 20%, gross margin up 180 basis points to 24.1%, and 50.0 million tons shipped at a freight-adjusted $22.80 a ton. Full-year guidance, reaffirmed, calls for 4% to 6% pricing growth on 1% to 3% volume growth, with adjusted EBITDA of $2.4 to $2.6 billion. Each quarter's price realization is the single most important number, because the whole valuation rests on pricing continuing at that pace.

Demand drivers are the medium-term swing factor. Public construction funded by infrastructure programs and a recovering private market underpin the volume guide, and a newer structural driver, data-center construction with roughly 650 million square feet under way or announced, is a potential tailwind given that about 60% of large projects sit within 50 miles of a Vulcan facility. Watch infrastructure bid activity and the pace of the data-center build, since both feed the volume side that the cycle ultimately controls.

Sector sentiment and capital allocation round out the picture. The analyst consensus is a buy with an average target near the current price and a high end around $355, but a meaningful share sits on hold, and the peer read matters: Martin Marietta was downgraded on narrowing aggregate price realization, a warning that applies sector-wide. On capital, watch how management balances acquisitions, buybacks near record prices, and deleveraging against the roughly 3.5-times operating-income net debt, since at this multiple those choices move per-share value.

Peer Cohorts (Per Segment, With Filing Citations)

Aggregates 1 / Asphalt 2 (reported)

• MLM (MARTIN MARIETTA MATERIALS INC)
• FY2025 10-K: …with the April 2024 acquisition of 20 active aggregates operations from affiliates of Blue Water Industries LLC (BWI Southeast). These factors were partially offset by pricing gains across all product lines and lower energy costs. Aggregates gross profit increased in 2024, as contributions from acquired operations…
• FY2025 10-K: …for 76% of the Building Materials business' revenues from continuing operations in 2025. The Building Materials business is accordingly affected from time to time by the economies in these regions and has been adversely affected in part by episodic recessions and weaknesses in these economies and may be affected by…
• KNF (Knife River Corporation)
• FY2025 10-K: …around dependability. Products and Services Our core product lines include: aggregates, ready-mix concrete, asphalt and liquid asphalt. We also perform related contracting services. For the year ended December 31, 2025, our revenue and gross profit by products and services were as follows: Revenue ($ in millions) (%…
• FY2025 10-K: …2025-12-31 0001955520 us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember 2023-12-31 0001955520 us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember 2023-12-31 0001955520 us-gaap:AccumulatedGainLossNetCashFlowHedgeParentMember 2024-01-01 2024-12-31 0001955520…
• AMRZ (Amrize Ltd)
• FY2025 10-K: . Aggregates and other construction materials revenues were $4,665 million in 2025 , an increase of $219 million , or 4.9% , from $4,446 million in 2024 . Market uncertainty impacted demand in 2025, although the commercial market improved in the second half of 2025. Volumes For the years ended December 31, in millions…
• FY2025 10-K: :EmployeeStockOptionMember 2025-12-31 0002035989 us-gaap:RestrictedStockUnitsRSUMember us-gaap:ShareBasedCompensationAwardTrancheOneMember srt:MinimumMember 2025-01-01 2025-12-31 0002035989 us-gaap:RestrictedStockUnitsRSUMember us-gaap:ShareBasedCompensationAwardTrancheOneMember srt:MaximumMember 2025-01-01 2025-12-31…
• CRH (CRH public limited company)
• FY2025 10-K: :RestrictedStockUnitsRSUMember 2025-12-31 0000849395 crh:A2014PerformanceSharePlanPSPMember 2023-01-01 2023-12-31 0000849395 crh:A2014PerformanceSharePlanPSPMember 2025-01-01 2025-12-31 0000849395 crh:A2014PerformanceSharePlanPSPMember 2024-01-01 2024-12-31 0000849395 crh:TotalShareholderReturnMetricMember…
• FY2025 10-K: 0849395 us-gaap:PreferredStockMember 2025-12-31 0000849395 us-gaap:CommonStockMember 2025-12-31 0000849395 us-gaap:TreasuryStockCommonMember 2025-12-31 0000849395 us-gaap:AdditionalPaidInCapitalMember 2025-12-31 0000849395 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2025-12-31 0000849395…
• EXP (EAGLE MATERIALS INC.)
• FY2025 10-K: Aggregates business segment in fiscal 2025. The Northern Kentucky and Western Pennsylvania Acquisitions (collectively, the Aggregates Acquisitions) advance our long-term growth strategy by adding pure-play aggregates businesses that complement and extend our network of aggregate quarries and cement operations in both…
• FY2025 10-K: …business consists of mining, extracting, producing, and selling crushed stone, sand, and gravel. Aggregates are a granular material consisting of crushed stone, sand, and gravel, manufactured to specific sizes, grades, and chemistry for use primarily in construction applications. Readymix concrete is a versatile,…

Concrete (reported)

• MLM (MARTIN MARIETTA MATERIALS INC)
• FY2025 10-K: …and poured at the project site of a customer of the Company. The coarse aggregates used for ready mixed concrete are a washed material with limited amounts of fines ( i.e. , dirt and clay). The Company operates ready mixed concrete plants in Arizona and Texas as of December 31, 2025. The Texas ready mixed concrete…
• FY2025 10-K: …the conduct of the Company's business as a whole. Customers The Company's products are sold principally to commercial customers in private industry. Although large amounts of construction materials are used in public works projects, relatively insignificant sales are made directly to federal, state, county or…
• CRH (CRH public limited company)
• FY2025 10-K: % of CRH's Total revenues and 29% of Adju sted EBITDA. Materials and Products The following materials and products are produced and supplied by CRH's connected portfolio of businesses. Aggregates Aggregates are naturally occurring mineral deposits such as granite, limestone and sandstone. CRH extracts these deposits…
• FY2025 10-K: Concrete is a highly versatile building material, comprised of aggregates bound together with cement and water. Readymixed concrete is the most commonly used form of concrete. It forms the foundations of buildings and homes, roads, tunnels and bridges, water management systems and clean energy structures. While…
• EXP (EAGLE MATERIALS INC.)
• FY2025 10-K: Kansas City Area 9 Northern Colorado 4 Northern Nevada 7 Total 30 Demand, Sales, and Distribution Demand for readymix concrete and aggregates largely depends on local levels of construction activity. Construction activity is subject to weather conditions, the availability of financing at reasonable rates, and overall…
• FY2025 10-K: …fiscal 2025 earnings by segment is shown below. We conduct one of our cement operations through a Joint Venture, Texas Lehigh Cement Company LP, which is located in Buda, Texas. We own a 50% interest in the Joint Venture and account for our interest under the equity method of accounting. We proportionately…
• KNF (Knife River Corporation)
• FY2025 10-K: …in certain regions of each state throughout the United States. Generally extracted through open pits at the surface of a site or produced by blasting hard rock from quarries, aggregates are then crushed and screened to customer needs. The United States aggregates industry is highly fragmented, with many participants…
• FY2025 10-K: …high-single-digits for aggregates and low-single digits for asphalt. Our contracting services revenue also increased, as we benefited from additional public-agency work and timing of projects. Partially offsetting these increases were decreased ready-mix, aggregate and asphalt sales volumes, primarily due to…
• AMRZ (Amrize Ltd)
• FY2025 10-K: …on a variety of factors, including quality, value proposition, capacity, price, customer service, delivery time and proximity to the customer. Our principal competitors in the United States are Cemex, Buzzi-Unicem, Heidelberg Materials and CRH, as well as numerous local and regional players. Many of the regions in…
• FY2025 10-K: …to extended service warranties in the Building Envelope segment. Contract liabilities are recognized as revenue as (or when) the Company performs under the contract. Prior to the Spin-Off, certain contract liability balances were related-party in nature and are recorded in Due to related-party on the consolidated…
• MDU (MDU RESOURCES GROUP, INC.)
• FY2025 10-K: …used by the Company's chief executive officer. The Company, through its wholly-owned subsidiary, MDU Energy Capital, owns Montana-Dakota, Cascade and Intermountain. The electric segment is comprised of Montana-Dakota while the natural gas distribution segment is comprised of Montana-Dakota, Cascade and Intermountain.…
• FY2025 10-K: …the completion of the feasibility study. In September 2010, the WUTC approved the petition filed by Cascade regarding deferral of remediation costs, subject to conditions set forth in the order. A significant portion of the costs incurred to date have been recovered by insurance. MDU Resources Group, Inc. Form 10-K…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.