Reviewing Martin Marietta Materials (MLM) & Fairmount Santrol (FMSA)

Martin Marietta Materials (NYSE: MLM) and Fairmount Santrol (NYSE:FMSA) are both construction companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, profitability, earnings and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings for Martin Marietta Materials and Fairmount Santrol, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Martin Marietta Materials 0 3 5 0 2.63
Fairmount Santrol 1 9 10 0 2.45

Martin Marietta Materials currently has a consensus target price of $235.29, indicating a potential upside of 3.39%. Fairmount Santrol has a consensus target price of $6.01, indicating a potential upside of 6.68%. Given Fairmount Santrol’s higher probable upside, analysts plainly believe Fairmount Santrol is more favorable than Martin Marietta Materials.

Valuation & Earnings

This table compares Martin Marietta Materials and Fairmount Santrol’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Martin Marietta Materials $3.97 billion 3.64 $713.34 million $7.18 31.98
Fairmount Santrol $959.79 million 1.32 $53.78 million $0.24 23.46

Martin Marietta Materials has higher revenue and earnings than Fairmount Santrol. Fairmount Santrol is trading at a lower price-to-earnings ratio than Martin Marietta Materials, indicating that it is currently the more affordable of the two stocks.

Dividends

Martin Marietta Materials pays an annual dividend of $1.76 per share and has a dividend yield of 0.8%. Fairmount Santrol does not pay a dividend. Martin Marietta Materials pays out 24.5% of its earnings in the form of a dividend.

Institutional and Insider Ownership

100.0% of Martin Marietta Materials shares are held by institutional investors. Comparatively, 71.5% of Fairmount Santrol shares are held by institutional investors. 0.8% of Martin Marietta Materials shares are held by insiders. Comparatively, 9.8% of Fairmount Santrol shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Martin Marietta Materials has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500. Comparatively, Fairmount Santrol has a beta of 2.13, suggesting that its share price is 113% more volatile than the S&P 500.

Profitability

This table compares Martin Marietta Materials and Fairmount Santrol’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Martin Marietta Materials 17.36% 9.47% 5.13%
Fairmount Santrol 8.89% 33.29% 7.96%

Summary

Martin Marietta Materials beats Fairmount Santrol on 9 of the 16 factors compared between the two stocks.

Martin Marietta Materials Company Profile

Martin Marietta Materials, Inc., a natural-resource-based building materials company, supplies aggregates and heavy building materials to the construction industry in the United States and internationally. The company provides crushed stone, sand, and gravel products; ready mixed concrete, and asphalt and paving products; and Portland and specialty cement for use in the infrastructure projects, and nonresidential and residential construction markets, as well as in the railroad, agricultural, utility, and environmental industries. It also manufactures and markets magnesia-based chemical products for the industrial, agricultural, and environmental applications; and dolomitic lime primarily for customers in the steel and mining industries, as well as provides road paving construction services. The company's chemical products are used in flame retardants, wastewater treatment, pulp and paper production, and other environmental applications. Martin Marietta Materials, Inc. was founded in 1993 and is headquartered in Raleigh, North Carolina.

Fairmount Santrol Company Profile

Fairmount Santrol Holdings Inc., together with its subsidiaries, provides sand-based proppant solutions for exploration and production companies. The company operates in two segments, Proppant Solutions and Industrial & Recreational Products. The Proppant Solutions segment primarily provides sand-based proppants for use in hydraulic fracturing operations in the United States, Canada, Argentina, Mexico, China, and northern Europe. Its products include northern white frac sand, API-spec brown sand, and coated sand products; and Propel SSP product that utilizes a polymer coating applied to a proppant substrate. The Industrial & Recreational Products segment offers raw, coated, and custom blended sands for use in building products, foundry, glass, turf and landscape, and filtration industries primarily in North America. Fairmount Santrol Holdings Inc. also supplies proppants to oilfield service companies. The company was formerly known as FMSA Holdings Inc. and changed its name to Fairmount Santrol Holdings Inc. in July 2015. Fairmount Santrol Holdings Inc. was incorporated in 1986 and is headquartered in Chesterland, Ohio.

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