Is Martin Marietta a Good Investment?

PHOTO CREDIT: Martin Marietta Materials

OVERVIEW

Martin Marietta Materials Incorporation is a company based in the United States. The company specializes in producing raw materials for infrastructure products in the United States. The company produces materials like gravel, crushed stone, mixed concrete, asphalt, and pavement products, as well as a select list of chemicals used in these projects. The company was founded in 1993.

Why You Should?

  1. Martin Marietta reports some of its strongest numbers under a strong global economy. This is why COVID-19 vaccine optimism will drive the stock higher. People will drive and use infrastructure more. Furthermore, public and private builders will need to maintain this infrastructure. This will lead the company to sell higher volumes of material. This will benefit investors in the company.
  2. Infrastructure development is one of the few bipartisan issues in Washington and many other state and local governments. Under a Biden administration, congress might pass some massive infrastructure projects, something that will benefit the company in the future. This will improve the company’s future growth and will benefit investors in the company.
  3. The infrastructure industry continues to grow every single year. This is because there are many more infrastructure projects as there are a growing number of people in the United States. In other words, more buildings, roads, and bridges need to be built for the future. This will benefit a company like Martin Marietta will see growing volumes. This will benefit the company and investors.
  4. Due to the reasons mentioned above, Martin Marietta has seen rising revenues and profits. This will benefit the company’s future growth as they can develop and build new factories and more cost-effective production methods, This will benefit the company and its investors. In the financial year of 2019, the company reported revenues of around 4.42 billion and profits of around 611 million. Both of these metrics are higher than what the company reported in the financial year of 2018 when the company reported revenues of around 3.98 billion and profits of around 470 million.
PHOTO CREDIT: Yahoo Finance

Why You Should Not?

  1. Martin Marietta faces tough competition across all of its markets. Some of these companies include Vulcan Materials, Eagle Materials, and many others. This tough competition might hurt the company’s future growth. This will also hurt investors in the company.
  2. Impacts from the COVID-19 pandemic might continue to hurt the company even after this pandemic is over. This is because in the short to mid-term, spending from federal, state, and local governments might focus on preparing for the next pandemic. This might take away finding from infrastructure projects, something that will hurt Martin Marietta.

MY OPINION

Martin Marietta makes the backbone of America, the infrastructure. In my opinion, I think that Martin Marietta is a great long-term investment due to COVID-19 vaccine optimism, infrastructure being a bipartisan issue, its place in a growing industry, and rising revenues and profits. However, tough competition and impacts from the COVID-19 pandemic might hurt the company in the future.

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Aaditya Patel is a writer who publishes analysis on companies publicly traded on the NYSE. Follow him @the_investing787 on Instagram for summary posts.

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Aaditya Patel

Aaditya Patel

Aaditya Patel is a writer who publishes analysis on companies publicly traded on the NYSE. Follow him @the_investing787 on Instagram for summary posts.

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