Martin Marietta Materials, Inc. (MLM) Stock Valuation — PE Analysis
Construction Materials · NYSE
Current Price
$577.33
PE Ratio (TTM)
13.7x
Intrinsic Value
$777.98
+25.8% margin of safety
COMPETITIVE MOAT
↑Aggregates Dominance
MLM possesses extensive, strategically located reserves of aggregates, a critical input for construction. This geographic advantage creates high switching costs for customers and limits new entrants.
↑Infrastructure Tailwinds
The company benefits from sustained demand driven by government infrastructure spending and private sector development. This provides a predictable and growing revenue stream.
↑Economies of Scale
MLM's large operational footprint allows for significant economies of scale in production and distribution. This cost advantage is difficult for smaller competitors to replicate.
INVESTMENT RISKS
↓Rising Input Costs
Increased costs for fuel, labor, and equipment can pressure margins, as seen in Q1 2026. This directly impacts profitability despite strong demand.
↓Cyclical Construction Demand
While infrastructure is a tailwind, overall construction activity is cyclical and sensitive to economic downturns. A significant slowdown could reduce demand for MLM's products.
↓Regulatory and Environmental Hurdles
Obtaining permits for new quarry sites and complying with environmental regulations can be time-consuming and costly. This limits expansion opportunities.
Base case
MLM base case PE valuation
A base case PE valuation for MLM estimates a fair value of about $777.98 per share, against a current price of $577.33. The model assumes 9.4% annual earnings growth, a 14x target PE multiple, and a 10% discount rate.
Intrinsic Value
$777.98
Margin of safety
+25.8%
Expected annual return
+6.1%
Base case assumptions: 9.4% annual earnings growth, 14x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
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)
13.7x
PEG Ratio
0.10
Earnings Yield
7.28%
ROE (TTM)
25.1%
Revenue/Share (TTM)
$108.67
Dividend Yield
0.58%
Debt/Equity
0.50x
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 13.7x combined with a PEG ratio of 0.10 provides a growth-adjusted perspective. A PEG below 1.0 suggests MLM may be undervalued relative to its 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 (13.7x) 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 (13.7x) by the expected earnings growth rate. A PEG below 1.0 is traditionally considered a sign of undervaluation — the market may not be fully pricing in the growth potential. 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 25.1%, 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 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.