Hennessy Equity and Income Fund on Martin Marietta Materials, Inc.
Thesis
Martin Marietta was a relative detractor because shares were pressured by elevated expectations rather than deterioration in fundamentals. The fund continues to see infrastructure and nonresidential demand supported by IIJA funding and data-center construction. Recent acquisitions are expected to improve pricing, margins and cash flow. The managers therefore remain confident in the company's ability to compound earnings over the long term.
“We remain confident in Martin Marietta’s ability to compound earnings over the long term.”
Key risks
- Elevated expectations can pressure the shares even when fundamentals remain intact.