Chuck Murphy presented his in-depth investment thesis on Eagle Materials (NYSE: EXP) at Best Ideas 2016.
Eagle Materials: The company’s primary businesses are cement and wallboard (together ~80% of revenue). The smaller piece of the business is well cement and frac sand (i.e., upstream oil and gas). The stock has gotten rocked by crude’s decline and some temporary softness in the wallboard market, but my thesis is 1) the cement and wallboard businesses will continue to ride the recovery in the U.S. residential/non-residential markets, 2) the recent U.S. Highway Spending Bill will give the cement business an additional boost, 3) the upstream oil/gas businesses are currently being given a value of close to $0 but as oil rebounds (and we think it will in 2016) that will change quickly and dramatically, and 4) the management team is solid and even though the products are commodities, the company is the low-cost producer (via technology) in each market.
About the instructors:
Chuck Murphy is the managing partner and portfolio manager at Liberty Park Capital Management in Austin, TX. Prior to founding Liberty Park, Chuck was an equity research analyst at Sidoti & Co. in New York. He also worked in Morgan Stanley’s Investment Management division as an analyst in the fund accounting and operations group. Chuck holds a BBA in Finance from Texas A&M University.
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