How construction materials firms fared in the first quarter

By , and |  April 5, 2024

As the first quarter comes to a close, share prices for construction materials companies continue to outperform the broader markets.

Factors such as pricing momentum, IIJA projects coming online and broad economic optimism have given investors confidence in construction materials index (CMI) company stocks. These tailwinds have also spurred recent mergers and acquisition activity for the sector, headlined by Martin Marietta’s $2.05 billion acquisition of Blue Water Industries’ Southeast aggregate assets.

There is room to grow for these companies, especially if inflation continues to trend downward and the Fed begins to cut interest rates. Favorable monetary policy could propel construction materials stocks even higher.

FMI Capital Advisors’ Construction Materials Index (CMI) versus the Dow Jones Industrial Average and S&P 500 as of March 26, 2024. Source: S&P CapIQ as of March 26, 2024

FMI Capital Advisors’ Construction Materials Index (CMI) versus the Dow Jones Industrial Average and S&P 500 as of March 26, 2024. Source: S&P CapIQ | Click here to enlarge

The CMI combines the stock performance of 16 publicly traded companies that operate primarily in the hot-mix asphalt, ready-mixed concrete and construction aggregate space within the U.S.

Related: The factors aiding recent construction materials acquisitions

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