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    MLM · NYQ · Basic Materials

    Martin Marietta Materials, Inc.

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 478.02

    Market price

    USD 552.22

    Implied upside

    -13.4%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedCapital expenditure runs at 11.8% of revenue against depreciation of 9.3%. A perpetuity has to be a steady state, so the forecast tapers capex to maintenance at depreciation plus the reinvestment terminal growth requires (g/ROIC of NOPAT), and the terminal year carries on from there. The bridge is shown under Terminal Value.

    Current EV/EBITDA of 21.4x sits outside a defensible 3-20x band, so the exit multiple is capped at 20.0x. A multiple that far out usually means EBITDA is the wrong denominator for this business.

    Value Per Share

    Perpetuity growth
    USD 478.02-13.4%
    Exit multiple
    USD 1165.34+111.0%
    Market price
    USD 552.22

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn3bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 7.8bnUSD 9.6bnUSD 11.5bnUSD 13.6bnUSD 15.7bnUSD 17.7bnUSD 19.4bnUSD 20.9bnUSD 22.0bnUSD 22.5bn+12.5%
    EBITUSD 1.7bnUSD 2.1bnUSD 2.5bnUSD 3.0bnUSD 3.5bnUSD 3.9bnUSD 4.3bnUSD 4.6bnUSD 4.8bnUSD 5.0bn+12.5%
    NOPATUSD 1.4bnUSD 1.7bnUSD 2.0bnUSD 2.4bnUSD 2.7bnUSD 3.1bnUSD 3.4bnUSD 3.7bnUSD 3.9bnUSD 4.0bn+12.5%
    Add depreciation & amortisationUSD 727.7mUSD 894.0mUSD 1.1bnUSD 1.3bnUSD 1.5bnUSD 1.6bnUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.1bn+12.5%
    Less capital expenditureUSD -921.1mUSD -1.1bnUSD -1.4bnUSD -1.7bnUSD -2.0bnUSD -2.2bnUSD -2.5bnUSD -2.7bnUSD -2.9bnUSD -3.0bn+14.1%
    Capex, % of revenue11.8%12.0%12.1%12.3%12.5%12.7%12.8%13.0%13.2%13.4%-
    Less increase in working capitalUSD -383.9mUSD -412.2mUSD -450.1mUSD -473.7mUSD -478.0mUSD -458.7mUSD -413.1mUSD -340.7mUSD -243.7mUSD -126.8m-11.6%
    Free cashflow to firmUSD 793.2mUSD 1.0bnUSD 1.2bnUSD 1.5bnUSD 1.8bnUSD 2.0bnUSD 2.3bnUSD 2.6bnUSD 2.8bnUSD 2.9bn+15.6%
    Discount factor0.95960.88360.81360.74910.68980.63520.58480.53850.49590.4566-
    Present valueUSD 761.1mUSD 898.8mUSD 1.0bnUSD 1.1bnUSD 1.2bnUSD 1.3bnUSD 1.4bnUSD 1.4bnUSD 1.4bnUSD 1.3bn-
    Present Value Of The ForecastUSD 11.8bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta1.019Reported 1.029, pulled toward 1.0 (Blume)
    Cost of equity9.21%Risk-free + beta x equity risk premium
    Cost of debt5.59%Risk-free + 70bp, the spread for a A+ rating at 6.3x interest cover. Book interest / average debt was lower, at 4.0%.
    Market capitalisationUSD 39.2bn87.3% of capital
    Total debtUSD 5.7bn12.7% of capital, book value as a proxy
    Tax rate20.4%Effective, capped at statutory
    WACC8.60%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 478.02

    66% of EV

    Forecast FCFF, final year
    USD 2.9bn
    Capex at depreciation, working capital in reinvestment
    USD 4.2bn
    Less reinvestment at g/ROIC (29.1% of NOPAT)
    USD -1.2bn
    Capitalised
    USD 3.0bn
    ROIC (WACC floor)
    8.6%
    Terminal value, undiscounted
    USD 50.0bn
    Terminal value, discounted
    USD 22.8bn
    Enterprise value
    USD 34.6bn
    Less net debt
    USD 5.6bn
    Equity value
    USD 29.0bn

    Exit at 20.0x EBITDA

    Value per shareUSD 1165.34

    85% of EV

    Terminal value, undiscounted
    USD 141.3bn
    Terminal value, discounted
    USD 64.5bn
    Enterprise value
    USD 76.3bn
    Less net debt
    USD 5.6bn
    Equity value
    USD 70.6bn

    Spread between methods: 84%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    6.60%745.57748.40754.28764.50781.14
    7.60%591.37583.14575.10567.29559.82
    8.60%493.57485.80478.02470.24462.47
    9.60%419.03412.45405.87399.29392.71
    10.60%359.29353.66348.02342.39336.76

    Outlined: this model. Green text: above today's price of 552.22. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year-0.1%13.9%15.5%
    EBIT margin23.7%22.0%24.7%
    Discount rate-8.6%7.8%
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    Yahoo Finance and RBA data. General information, not advice. Methodology.