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1 'Strong Buy' Dividend Stock That Insiders Are Buying
Investors commonly track insider buying activity to gauge company leadership’s confidence in the stock’s future performance. “Insider buying” occurs when executives, board members, or major shareholders (owning 10% or more) purchase stock, and it's often viewed as a bullish signal that these well-informed individuals are willing to buy shares with their own money.
Considering this, it's worthwhile to call out some recent insider buying in shares of a dividend-paying building materials company. This under-the-radar stock has already outperformed the S&P 500 Index ($SPX) and the Nasdaq Composite ($NASX) in 2024, and analysts are projecting more upside to come.
About CRH Stock
Founded in 1970 through the merger of two Irish companies, Dublin-based CRH (CRH) is one of the world's largest suppliers of building materials and products. It operates in three key areas, namely, heavyside materials, building products, and distribution. The company's market cap currently stands at $63.4 billion.
CRH stock is up 36.5% on a YTD basis, and more than 80% over the past 52 weeks - comfortably outpacing the broader equities market.
The stock also offers a dividend yield of 1.48%, based on its recently raised quarterly payout of $0.35. CRH has paid dividends for over 30 years.
Insider Buying on CRH
On Oct. 18, longtime board member Siobhan Talbot made a sizable investment in the company's stock. She purchased 2,000 shares of CRH at an average price of $93.8413 per share for a total value of about $187,683.
Ireland-based Talbot has been a Director at CRH since 2018, and is a member of the Acquisitions, Divestments & Finance Committee; the Audit Committee, where she's the resident financial expert; and the Nomination & Corporate Governance Committee - making her recent purchase an insider move worth watching, particularly ahead of earnings from CRH on Nov. 7.
Notably, Talbot hasn't been the only high-profile buyer of CRH lately. During Q2, Dan Loeb's Third Point Capital added a new stake in CRH, dipping his toes in with 650,000 shares.
In other insider news, CRH has a management shake-up coming later this year, when CFO Jim Mintern steps in to take over for CEO Albert Manifold as part of a planned transition. Manifold will stay on in an advisory role for one year after he steps down in December.
CRH Raises Guidance
CRH has been a steady performer on the earnings front over the longer term, with revenues expanding at a CAGR of 6.37% over the last five years and earnings at a rate of 14.85%.
The company reported mixed results in the latest quarter, as earnings per share (EPS) of $1.89 beat expectations, while revenue fell slightly year over year to $9.65 billion, missing estimates. CRH had $3.9 billion of cash and cash equivalents and restricted cash on hand, down from $4.3 billion at the end of Q2 2023.
However, CRH raised its full-year guidance to call for net income between $3.70-$3.85 billion and adjusted EBITDA of $6.82-$7.02 billion.
When CRH reports earnings again in early November, Wall Street is looking for an adjust profit of $2.11 per share, on average, on revenue of $10.36 billion.
CRH's Strategic Edge
CRH’s competitive advantage is rooted in its vertically integrated structure and comprehensive approach to building materials and solutions. By covering the entire process — from raw materials to finished structures like highways and bridges — CRH offers customers a seamless, end-to-end service. This model enables CRH to serve as a "one-stop shop" for infrastructure projects, adding value through its project management, design, and engineering capabilities.
CRH is also well-positioned to benefit from significant U.S. federal funding initiatives, such as the Inflation Reduction Act and the Infrastructure Investment and Jobs Act, which enhance revenue visibility due to their lower cancellation risk compared to private projects. For instance, the Federal Highway Program has allocated $350 billion to road infrastructure, an area in which CRH is already North America’s leading road paver.
Strategic acquisitions have further bolstered CRH’s operations. In February 2024, CRH acquired a portfolio of cement and ready-mixed concrete assets in Texas for $2.1 billion, a move that strengthens its market position in aggregates and cement and is projected to yield $60 million in cost savings by the third year after closing, through integration and operational efficiencies.
The July Adbri acquisition also complements CRH’s existing strengths. As a major producer of lime, cement, and dry blended products in Australia, Adbri aligns with CRH’s core competencies and enhances growth prospects for its Australian operations, expanding its influence and opportunities in the region. Through both its operational model and these acquisitions, CRH reinforces its position as a key provider in the global building materials industry.
What's the Forecast for CRH Stock?
Analysts are bullish about CRH as well, with the majority having assigned a rating of “Strong Buy” for the stock. Out of 13 analysts in coverage, 10 have a “Strong Buy” rating, 2 have a “Moderate Buy” rating, and 1 has a “Hold” rating.
The mean target price for CRH is $101.92, which indicates an expected upside potential of about 8% from current levels.
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On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
