Stephen Dodson of Bretton Fund presented his investment thesis on Eagle Materials (US: EXP) at Best Ideas 2025, held from January 9-24.
Thesis Summary
Eagle Materials is a long-term compounder in a so-so, cyclical industry. It has $2.5 billion in revenue and an $8 billion market cap.
The business mix is ~50% cement, ~50% wallboard. Eagle has best-in-class margins and returns on capital (2-3x average). Tailwinds include favorable industry growth, combined with structural competitive advantages.
Management has exhibited excellent capital allocation. Eagle is a best-in-class operator with 40% ROE and a modest valuation at a P/E of less than 15x. The company remains relatively unknown, but is a compounder, with a long runway. The business enjoys structural, durable advantages.
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Slides
Let’s listen to the full session and look over the transcript.
