Eagle Materials (EXP:NYS) Fundamental Valuation Report

Fundamental Valuation Report

Eagle Materials(EXP:NYS)

Basic Materials:Building Materials

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$84.24 (USD) 03/09/2019

Weighted Valuation
$80.27 (USD)

Overall Rating
Fairly valued to slightly Overvalued by 4.7%

Valuation Models Analyst Consensus: $82.00 (USD)
(in order of importance) Comparables: $68.85 (USD)
Adjusted Book Value: $97.91 (USD)
Valuation Methods This company is:
Cash Flow: Undervalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation

Company Overview (EXP:NYS USD)

Price 84.24
Range 81.49 – 84.47
52 week 57.48 – 92.70
Open 83.47
Vol / Avg. 485592/459750
Mkt cap 3.9B
P/E 61.41
Div/yield 0.40/0.00
EPS 1.47
Shares 43.21M
Beta 1.29

Company Description

Eagle Materials Inc produces and sells construction products, building materials, and materials used for oil and natural gas extraction. Construction products include cement, slag, concrete, and aggregates and building materials include gypsum wallboard, and are sold to the construction and building industries. Basic materials used for oil and natural gas extraction include frac sand and oil well cement. The firm organizes itself into three sectors: Heavy Materials, which includes the Cement and Concrete and Aggregates segments; Light Materials, which includes the Gypsum Wallboard and Recycled Paperboard segments; and Oil and Gas Proppants, which are used in oil and gas extraction.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for EXP:NYS

Using a discounted cash flow model we generated an intrinsic value of $101.95 (USD) for EXP:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

EXP:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $101.95 1% 5% 1% 5%
WACC (or Ke) 9.40 $123.23 $86.43
Terminal Growth Rate 3.00 $88.01 $121.06
Tax Rate 0.14 $109.41 $94.49
Cash Flow 530,926,447 $94.44 $109.46
Capital Expenditures -111,324,600 $100.56 $103.34
Long Term Debt 469,182,000 $102.49 $101.41

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $68.85 (USD) for EXP:NYS. We also generated a valuation of $66.39 (USD) using other metrics and comparables.
The comparable companies were TopBuild (BLD:NYS), JELD-WEN Holding (JELD:NYS), Armstrong World Indus (AWI:NYS), Owens-Corning (OC:NYS) and Gibraltar Industries (ROCK:NAS).

Company EXP:NYS End Date Value
Earnings/Share $1.03 (USD)
Book Value/Share $25.11 (USD)
Sales/Share $29.83 (USD)
Cash Flow/Share $6.95 (USD)
EBITDA/Share $5.00 (USD)
Price Based on Comps Adjustment Factor (%)
$19.38 (USD) 52.2
$138.48 (USD) -30.2
$51.27 (USD) 0.0
$83.86 (USD) 26.4
$56.86 (USD) 0.0
81.74 PE Ratio 18.81 18.94 16.44 23.99 12.34 22.37
3.35 PB Ratio 5.51 2.78 2.20 19.12 1.42 2.06
2.82 PS Ratio 1.72 1.26 0.41 4.74 0.89 1.30
12.12 PCF Ratio 14.24 14.61 6.57 29.79 8.06 12.17
22.34 EV to EBITDA 11.38 12.27 10.70 14.15 7.62 12.15


Using a multiples approach we generated a valuation of  $77.39 (USD) for EXP:NYS

Company EXP:NYS End Date Value
Earnings/Share $1.03 (USD)
Book Value/Share $25.11 (USD)
Sales/Share $29.83 (USD)
Cash Flow/Share $6.95 (USD)
EBITDA/Share $5.00 (USD)
Price Based on Comps Adjustment Factor
$23.03 (USD) 0
$91.97 (USD) 0
$106.48 (USD) 0
$100.82 (USD) 0
$64.65 (USD) 0
Ratios Ratio Average
PE Ratio 22.36
PB Ratio 3.66
PS Ratio 3.57
PCF Ratio 14.51
EV to EBITDA 12.93

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  EXP:NYS for the last 10 years was  3.65

We ran the Adjusted Book Value for  EXP:NYS and generated a book value of  $26.81 (USD)
By multiplying these we get an adjusted valuation of  $97.91 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for EXP:NYS. The 2 analysts have a concensus valuation for EXP:NYS for 2020 of $82.00 (USD).

EXP:NYS Eagle Materials

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
1 2 1 3.0000 Hold 2019-9-2

Current Price: 84.24 USD

Analyst Consensus
USD Millions 2020 2021
Mean EPS 5.36 6.04
# EPS Analysts 3 3
Mean Revenue 1,401.00 1,470.20
# Revenue Analysts 1 1
Mean Target Price 82.00
Mean Cash Flow
Mean EBITDA 448.90 479.60
Mean Net Income 239.90 265.20
Mean Debt Outstanding
Mean Tax Rate 22.00 22.00
Mean Growth Rate
Mean Capital Expenditure

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.
The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).
The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.
We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.
Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.
With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.
If we have Analyst coverage for the company we use the consensus target price here.

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