Vulcan Materials Company (VMC) Intrinsic Value & DCF Valuation
Construction Materials · NYSE
Current Price
$283.92
Intrinsic Value
$235.47
-20.6% margin of safety
What Is Vulcan Materials Company's Intrinsic Value?
As of 2026-07-29, the base-case DCF model estimates the intrinsic value of Vulcan Materials Company (VMC) at $235.47 per share, compared with a market price of $283.92, a margin of safety of -20.6%. The base case assumes 6.2% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $197.28 to $278.94. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is Vulcan Materials Company (VMC) Undervalued?
At the current price of $283.92, VMC trades above the base-case intrinsic value estimate by a meaningful margin. By this model the stock looks expensive, though faster growth than assumed would change the picture.
COMPETITIVE MOAT
↑Dominant Aggregates Market Share
Vulcan is the largest producer of construction aggregates in the US. This scale provides significant cost advantages and market influence.
↑Extensive Quarry Network & Reserves
The company possesses vast reserves of high-quality aggregates, a critical and geographically constrained resource. This limits new entrants and secures long-term supply.
↑High Switching Costs for Customers
Construction projects rely on consistent aggregate supply. Changing suppliers mid-project is costly and disruptive, creating customer stickiness.
INVESTMENT RISKS
↓Cyclicality of Construction Demand
Vulcan's revenue is highly dependent on the health of the construction industry, which is sensitive to economic cycles and interest rates.
↓Transportation and Logistics Costs
Aggregates are bulky and expensive to transport. Fluctuations in fuel prices and transportation availability directly impact profitability.
↓Environmental, Social, and Governance (ESG) Scrutiny
The mining and quarrying industry faces increasing pressure regarding environmental impact and community relations, potentially leading to operational disruptions.
Base case
VMC base case valuation
Intrinsic Value
$235.47
Margin of safety
-20.6%
Expected annual return
-3.7%
Base case assumptions: 6.2% annual growth, 10.0% discount rate, 30x exit multiple, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the VMC valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for Vulcan Materials Company respond.
Open DCF Calculator for VMCCompany Overview
Vulcan Materials Company, alongside its affiliated entities, stands as a prominent producer and distributor of construction aggregates, primarily operating within the United States. The company's activities are organized into four distinct divisions: Aggregates, Asphalt, Concrete, and Calcium. The Aggregates division focuses on providing essential materials like crushed stone, sand, gravel, and other foundational aggregates, along with related services. These products are vital for building and maintaining highways, public infrastructure, residential properties, and various commercial, industrial, and other non-residential structures. Through its Asphalt Mix segment, the firm furnishes asphalt mixture to locations in Alabama, Arizona, California, New Mexico, Tennessee, and Texas, additionally performing asphalt paving work in Alabama, Tennessee, and Texas. The Concrete segment supplies ready-mixed concrete to customers in California, Maryland, New Jersey, New York, Oklahoma, Pennsylvania, Texas, Virginia, and Washington D.C. Lastly, the Calcium division is responsible for mining, manufacturing, and marketing calcium products for use in animal feed, plastics, and water treatment industries. Established in 1909, the corporation, initially known as Virginia Holdco, Inc. before its name change, is headquartered in Birmingham, Alabama.
Financial Metrics — VMC Stock Valuation Data
Revenue/Share (TTM)
$62.27
FCF/Share (TTM)
$7.89
ROIC (TTM)
8.2%
ROE (TTM)
13.1%
P/FCF
35.9x
EV/EBITDA
16.2x
FCF Yield
2.79%
Debt/Equity
0.58x
Based on trailing twelve-month data, VMC shows a free cash flow per share of $7.89 and a ROIC of 8.2%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 35.9x and FCF yield of 2.79% are important context metrics when evaluating VMC's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of VMC?
Vulcan Materials Company currently generates $7.89 in free cash flow per share. At the current price of $283.92, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is VMC undervalued?
VMC trades at a P/FCF ratio of 35.9x with a free cash flow yield of 2.79%. This P/FCF is in a moderate range. However, whether VMC is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value VMC stock using DCF?
To perform a DCF valuation on Vulcan Materials Company: (1) Start with the trailing free cash flow per share ($7.89) as the base, (2) project future FCF growth over 5-10 years based on Construction Materials industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting VMC's risk profile — with a debt-to-equity of 0.58x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to VMC?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For Vulcan Materials Company, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Construction Materials trends, then discounting those amounts to today's dollars. VMC's ROIC of 8.2% shows moderate capital returns.
How does WACC affect VMC stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For VMC, with a debt-to-equity ratio of 0.58x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 16.2x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See VMC PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Basic Materials valuationsDCF and P/E value VMC with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.