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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Eagle Materials Inc. (XNYS:EXP) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
EXP
Name:
EAGLE MATERIALS INC. (XNYS:EXP)
Sector:
99.19M
Industry:
Building Materials
CEO:
Mr. Michael Haack
Total Employees:
2,200
Our Technological Advancement Rating
Our Rating:
A
Technological advancement compared to industry is 378.54% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF EAGLE MATERIALS INC.(EXP) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND BUILDING MATERIALS INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
116.3
One Month Price Target:
$117.14
Six Month Price Target :
$121.34
Likely Price in One Year's Time:
Ticker:
$126.38
Likely Trading Range Today Under (Normal Volatility)
$115.81
Price Upper limit ($) :
$116.98
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$109.33
This week:
$100.71
This month :
$85.11
Other Primary facts
Market Cap:
4.34B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
37.68M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
21.26%
-18.1%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$148.65
$133.73
$83.95
$98.87
Medium risk (<10%) entry points
Buy Call
Sell Call
$128.87
Buy Put:
Sell Put:
$125.69
$103.68
$106.91
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
EXP
Sharpe Ratio:
2.44%
Comparison:
EXP, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 15.90% higher than the industry
& ratio is 7.11% higher than the market/S&P 500 average
Average Returns/Yield of
EXP
Daily returns:
0.08%
Weekly returns:
0.41%
Monthly returns:
1.62%
Yearly returns:
16.13%
Comparison of returns:
Average annual returns/yield (last 3 years) is 20.64% above industry average
Classification:
EXP, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.8
Statistical test of Returns:
EXP has not yielded statistically significant higher returns when compared to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.96%
Weekly Volatility:
6.62%
Monthly Volatility:
13.23%
Yearly Volatility:
45.84%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.82%
Volatility in last five trading days has been -72.39% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.00%
Weekly VaR:
-13.41%
Monthly VaR:
-26.81%
How Much Can the price of
EXP
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-23%
Worst case (decline):
-92.89%
This translates to price declining to:
$89.80
This translates to price declining to:
$8.27
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
EXP is a 89.26% riskier investment compared to the market/S&P 500 & is 62.14% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 7.37% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
EXP
Beta in relation to market/S&P 500--1.29
Expected beta in 1 year's time:
0.765
Expected beta in 3 year's time:
1.081
Unlevered (debt free) Beta:
0.811
Beta in relation to Nasdaq (XNAS):
1.034
Beta in relation to all global stocks::
1.099
Beta Comparison & Analysis
Beta of competitors/peers::
1.454
Beta is -11.34% lower than peers
Average Industry Beta:
0.907
Beta is 42.16% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
25.45%
Sustainable growth rate is 71.67% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.075
Alpha is 10.50% above industry average alpha yield
Alpha is 476% higher than market/& is unsustainably high
Analysis of Cost of Capital of
EXP
Equity cost of capital:
0.120
Equity cost of capital is 27.97% above industry mean WACC
Unlevered (without debt) cost of capital:
7.54%
Before-tax cost of debt:
2.95%
After-tax cost of debt:
2.33%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.33%
WACC is 15.99% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$49.40
Revenue growth rate per share of (3Y):
3.15
Annual revenue growth rate is 17.81% above the industry average
EPS:
$9.14
Expected Annual growth rate of EPS (3Y):
81.16%
Expected future EPS growth rate is 222.67% higher than the Building Materials industry
Free cash flow (FCF) per share:
$10.42
Balance sheet equity growth per share: -75.18%
Equity growth rate per share is 161.92% higher than the industry
Debt per share
$27.65
EBITDA per share
$18.56
Valuation Analysis Today of
EXP
P/E Ratio:
12.08
P/E Ratio of Competitors/Peers:
28.34
P/E ratio is -57.38% lower than main peers & is -44.62% lower than the industry
Stock price/value with industry average P/E ratio: $199.33
EXP is -41.66% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
2.35
Price to sales ratio is -37.21% below the industry mean
P/B (Price to book value ratio):
3.15
Price to free cash flow: 11.17
-
Net income growth rate (3Y):
53.28%
Net income growth rate is -3.51% lower than the industry average net income growth rate
Dividend Analysis
-
Dividend yeild: 0.86%
Previous Dividend: $0.25
Previous adjusted dividend: $0.25
Previous Dividend: $1.00
Expected next dividend best case: $0.34
Expected next dividend worst case: $0.16
Average dividend payment (long-term): $0.21
Average dividend increase/decrease (growth rate) % per period: 25.00%
Expected next dividend payment date: 13/10/2022
Expected next dividend record date: 14/09/2022
-
Previous dividend payment date: 15/07/2022
Previous dividend record date: 16/06/2022
-
Dividend History:
2022-06-15--$0.25
2021-12-16--$0.25
2021-06-17--$0.25
2022-03-17--$0.25
2021-09-16--$0.25
2020-04-09--$0.10
Dividend growth rate is -162.00% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
74.88%
Net debt to equity ratio:
53.29%
Debt to assets ratio:
36.04%
Net debt to assets ratio:
25.65%
Debt-to-asset ratio is -9.24% below industry average
Ability to repay debt:
Interest coverage ratio:
22.65
Interest coverage ratio is -56.87% less than industry average
Looking forward:
Debt growth rate:
-33.48%
Annual debt growth is -147% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.745
Statistical significance of correlation:
EXP has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.612
Stock price is 21.74% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.612
Correlation of price movement with Nasdaq (^IXIC):
0.02
Covariance of price movement with the market:
0.035
Kurtosis
9.825
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
EXP
Gross Profit Margin Ratio:
111%
Operating Profit Margin Ratio:
0.49%
Operating profit margin is -97.03% lower than the industry
Net Profit Margin Ratio:
111%
Effective Tax Rate:
21.23%
Effective tax rate is 2.96% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
26.90%
Return on equity (ROE) is 57.33% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
12.95%
Return on assets (ROA) is 45.30% higher than the industry
Financial Leverage:
1.6x
Current Ratio:
3.87
Current ratio is 163.57% above industry average
Cash Conversion Cycle (days):
23.3
Cash conversion cycle is 55.96% above industry average
-
Stock based compensation to net income ratio:
0.66%
In-depth Efficiency Analysis
Revenue generated per employee:
846.1K
Each employee generates 31% more revenue than industry average revenue per employee
EBITDA generated per employee:
317.9K
Each employee generates 54% more EBITDA than industry average revenue per employee
Profit generated per employee:
170.1K
Each employee generates 64% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
45.1K
Each employee generates 213% more free cash flow than industry average revenue per employee
Assets/Capital per employee
981.6K
Each employee generates 213% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
EXP
MDU RESOURCES GROUP, INC. (XNYS:MDU)
KINROSS GOLD CORPORATION (XNYS:KGC)
UNITED STATES STEEL CORPORATION (XNYS:X)
ELEMENT SOLUTIONS INC (XNYS:ESI)
THE CHEMOURS COMPANY (XNYS:CC)
National Steel Company (XNYS:SID)
AXALTA COATING SYSTEMS LTD. (XNYS:AXTA)
Braskem SA (XNYS:BAK)
HUNTSMAN CORPORATION (XNYS:HUN)
Current Analyst Ratings
Strong buy�25%
Buy�0%
Hold�17%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Strong buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.86B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
1.34B
519.61M
-
46.80M
46.80M
-
-
46.80M
38.00K
30.87M
193.35M
699.31M
9.07M
374.25M
475.09M
100.85M
374.25M
Statement of Cash Flow
Date:
Period:
31.94M
Differed Income Tax :
1.80M
Stock Based Compensation :
2.46M
Change in Working Capital :
- 19435.00K
Accounts Receivables:
-
Other Working Capital:
542.29M
Other Non-Cash Items:
- 970.00K
Net Cash Provided by Operating Activities:
111.12M
Investments in PP&E:
- 11935.00K
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
6/30/21
2022
Q1
306.54M
-
306.54M
187.41M
217.05M
20.30M
731.30M
1.67B
-
-
76.37M
-
26.11M
2.16B
-
2.89B
96.92M
6.13M
20.98M
-
85.96M
189.01M
1.04B
40.90M
1.31B
-
1.50B
421.00K
1.38B
- 3413.0K
10.04M
June 30, 2021 at 6:00:00 AM
1.39B
1.39B
2.89B
-
1.05B
741.4M
-
-
- 11935.00K
-
-
- 63143.00K
-
6.98M
- 56164.00K
-
43.02M
311.54M
268.52M
111.12M
- 11935.00K
99.19M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
EXP
2023
2024
2025
2026
2027
$127.01
$267.64
$290.83
$316.03
$343.42