Vulcan Earnings: Pricing Gains Offset Softening End-Market Demand Amid Higher Interest Rates

Narrow-moat-rated Vulcan reported lackluster first-quarter results as the company navigated tepid demand in some construction end markets. Net sales declined 6% year over year, but this was largely attributable to the sale of some Texas concrete assets late last year. Higher interest rates have weighed on construction demand in many of Vulcan's markets, but the company was still able to generate pricing gains across much of its portfolio. While we expect demand headwinds to persist through the year, portfolio-wide selling price growth should offset much of the volume declines. As such, we have increased our fair value estimate to $164 from $162 per share.