Martin Marietta Materials, Inc. (MLM) Stock Valuation — PE Analysis
Construction Materials · NYSE
Current Price
$534.92
PE Ratio (TTM)
13.1x
Intrinsic Value
$729.59
+26.7% margin of safety
COMPETITIVE MOAT
↑Aggregated Scale and Distribution Network
MLM's extensive network of quarries and distribution facilities across the U.S. creates significant logistical advantages. This scale makes it difficult for smaller competitors to replicate their reach and service capabilities.
↑High Capital Intensity and Permitting Barriers
Establishing new aggregate quarries requires substantial capital investment and navigating complex, time-consuming environmental and zoning regulations. This acts as a significant barrier to entry for new players.
↑Pricing Power in Localized Markets
In many of its operating regions, MLM holds a dominant or near-dominant position in aggregate supply. This allows for considerable pricing power due to limited local alternatives for essential construction materials.
INVESTMENT RISKS
↓Cyclicality of Construction Industry
MLM's performance is highly dependent on the health of the broader construction and infrastructure spending cycles. Economic downturns or reduced government spending can significantly impact demand for its products.
↓Transportation and Fuel Cost Volatility
The cost of transporting aggregates is a significant factor in their delivered price. Fluctuations in fuel prices and transportation availability can directly impact MLM's margins and competitiveness.
↓Potential for New Material Substitutes
While aggregates are fundamental, long-term technological advancements could introduce viable, cost-effective substitutes for certain construction applications, potentially eroding demand for traditional materials.
Base case
MLM base case PE valuation
A base case PE valuation for MLM estimates a fair value of about $729.59 per share, against a current price of $534.92. The model assumes 9.7% annual earnings growth, a 13.06x target PE multiple, and a 10% discount rate.
Intrinsic Value
$729.59
Margin of safety
+26.7%
Expected annual return
+6.4%
Base case assumptions: 9.7% annual earnings growth, 13.06x target PE, 10% discount rate, 5 year projection. Data as of 2026-08-21.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the MLM PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Martin Marietta Materials, Inc. respond.
Open PE Calculator for MLMCompany Overview
Martin Marietta Materials, Inc. functions as a company specializing in natural resource-derived building materials. This enterprise delivers a wide range of aggregates and other heavy construction components to the building industry, serving both domestic and international markets. Its product portfolio includes foundational raw materials like crushed stone, sand, and gravel, in addition to manufactured items such as ready-mix concrete, asphalt, and comprehensive paving solutions. These offerings are essential for infrastructure projects, commercial and residential developments, and various other sectors including railroads, agriculture, utilities, and environmental applications. Beyond its core construction offerings, Martin Marietta also produces magnesia-based chemicals, which are utilized in industrial, agricultural, and environmental contexts. The company further supplies dolomitic lime, primarily for steel manufacturing and soil stabilization. Its broader chemical products contribute to areas such as flame retardants, wastewater treatment, and pulp and paper production, among other environmental uses. Established in 1939, the firm's main office is situated in Raleigh, North Carolina.
Financial Metrics — MLM PE Stock Valuation Data
PE Ratio (TTM)
13.1x
PEG Ratio
0.10
Earnings Yield
7.66%
ROE (TTM)
23.1%
Revenue/Share (TTM)
$111.30
Dividend Yield
0.62%
Debt/Equity
0.52x
Frequently Asked Questions
What is the PE ratio of MLM?
The trailing twelve-month PE ratio of MLM reflects how much investors pay per dollar of Martin Marietta Materials, Inc.'s earnings. This metric is most useful when compared to Construction Materials peers and the company's own historical range.
Is MLM overvalued based on PE ratio?
MLM's PE of 13.1x combined with a PEG ratio of 0.10 provides a growth-adjusted perspective. A PEG below 1.0 means the P/E is low relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Construction Materials, a DCF analysis may be more appropriate.
How do I value MLM stock using PE ratio?
To value Martin Marietta Materials, Inc. using PE: (1) Compare the current PE (13.1x) against the Construction Materials median to assess relative pricing, (2) check the PEG ratio (0.10) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of MLM?
MLM's PEG ratio is 0.10, calculated by dividing the PE ratio (13.1x) by the expected earnings growth rate. A PEG below 1.0 means the P/E is low relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for MLM stock valuation?
PE ratio gives a quick relative read — how MLM is priced versus Construction Materials peers. DCF provides an absolute value based on projected free cash flows. For MLM, with a strong ROE of 23.1%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See MLM DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Basic Materials valuationsP/E and DCF value MLM with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-08-21. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.