Analysts: Summit Materials, Inc. (SUM) Has Over 60.33% Upside Potential

It trades for 15.45 times the next 12 months of expected earnings. It is trading at rather expensive levels at just over 1.12x price/book and 0.73x price/sales. Compared to others, Summit Materials, Inc. is in a different league with regards to profitability, having net margins of 4.7%. To put some perspective around this, the industry’s average net margin is 7.44%. SUM’s ROE is 7.7%, which is considerably better than the industry’s ROE of 5.94%. It’s very liquid in the near term, with a current ratio of 2.3. The stock has a debt/capital of 1.36.

Summit Materials, Inc. (NYSE:SUM) is now worth $1.53B thanks to 0.45% gain in recent trade and currently has a price tag of $13.46. The shares traded as low as $12.81 and had $13.6 an intraday high earlier Thursday. Trading activity significantly improved as the volume at ready counter increased to 4,182,816 shares versus 2,649,330 in average daily trading volume over the past 20 days. So far this year, the volume has averaged about 2,026,950 shares. The stock is now 15.34% above against its bear-market low of $11.67 on October 29, 2018. It has retreated -153.05% since it’s 52-week high of $34.06 reached in January. Now the market price is down -56.3% on the year and down -57.19% YTD.

SUM’s 50 day simple moving average (SMA 50) price is $14.85 and its 200-day simple moving average (SMA 200) price is $23.54. The company’s stock currently has a total float of 111.29M shares. Its weekly volatility is hovering around 5.92% and felt 5.81% volatility in price over a month. On the upside, the share price will test short term resistance at around $13.77. On a downside, the stock is likely to find some support, which begins at $12.98. The failure to get near-term support could push it to $12.5.

Separately, it has been reported that multiple insider activity took place at Summit Materials, Inc. (SUM). Beck Thomas A. acquired 10,000 shares for $12,914 in transaction occurred on 2018/11/19. After making this transaction, the insider owns a direct stake of 139,700 shares, worth $173,822, as per the last closing price. On 2018/11/08 Harris Brian James, EVP & CFO at SUM, purchased 5,000 shares at an average price of $14.12 per share. The new stake is valued at $1,784,581.

EVP & COO, Watson Karl had invested in 35,500 shares for $35,500 through a trade on 2018/08/03. Following this activity, the insider holds 750,825 shares worth $477,830 as of recent close. Wall Street’s most bullish Summit Materials, Inc. (NYSE:SUM) analysts are predicting the share price to blow past $25 per share during the next 12 months. The current median share price forecast by them is $21, suggesting that the stock could increase 56.02% in that time frame. The average price target of $21.58 calls for a nearly 60.33% increase in the stock price.

It had seen a change in price target from analysts at Stifel, who reiterated the stock at Buy on August 03 but moved PT from $38 to $34. Analysts at Jefferies, started covering the stock on April 17 with a Buy rating. The stock won favor of Goldman analysts who expressed their confidence in it using an upgrade from Neutral to Buy on February 27.

Shares of Summit Materials, Inc. (SUM) have dropped -7.4% since the company’s last earnings report. Over the past 12 fiscal quarters, Summit Materials, Inc. (NYSE:SUM) has topped consensus earnings estimates in 5 quarters (41%), missed earnings in 6 quarters (50%), whereas at 1 occasion EPS met analyst expectations. SUM last reported earnings on November 06, 2018 when it released Sep-18 results that receded expectations. The company raked in $0.54 per share, -97.74% change on the same period last year. That was worse than consensus for $0.71. Revenue for the recent quarter stood at $625.02 million, up 9% on last year and below the $641.42 million predicted by analysts. For this quarter, Wall Street analysts forecast revenue in a range of $451.2 million to $489.22 million, which should be compared with $483.89 million generated last year. EPS is seen in a range of $0.04 to $0.2, against the $0.36 reported a year ago.