Construction Materials Market Outlook Summer 2019
2019 has been an interesting year thus far for the construction materials (CM) industry, from both a performance and M&A perspective. FMI’s Construction Materials Index (CMI) has slightly outperformed the major indexes year to date, after suffering sharp valuation declines in the second half of 2018. The Q1 earnings of public companies in the CMI were largely positive, and Q2 has generally proven to yield similar results.
While M&A deal-flow was relatively quiet in the first half of 2019, we did see some activity focused mainly on smaller, bolt-on transactions. As predicted, buyers concentrated on “safe” transactions, targeting companies in their existing geographic markets with complementary core competencies. As Q2 earnings are finalized and faith in the segment continues to stabilize, we anticipate an uptick in activity for the second half of 2019.
