Minerals Technologies (MTX) is emerging as one of the best infrastructure stocks to own during the Biden presidency. In fact, some analysts believe MTX has the potential to pop by more than 40% in a single year, thanks to Biden’s infrastructure spending plan.
All in all, Biden’s infrastructure plan, dubbed the “Build Back Better” plan, provides $2 trillion for spending on roads, highways, bridges, and other infrastructure components. This means plenty of money should be moving toward infrastructure companies such as MTX soon.
How high can MTX move in the year ahead? Let’s find out.
MTX’s Business
MTX is a tech and resources-based business that makes and markets a plethora of mineral-based products and synthetic mineral products, including support services and systems. The fact that the American Society of Civil Engineers gave the United States a C-minus grade for its infrastructure is bad news for the country yet fantastic news for MTX as the company’s infrastructure services will be in demand.
If the United States is going to “build back better” as planned by the Biden administration, it will require the assistance and expertise of the infrastructure specialists at MTX. MTX’s litany of synthetic materials used across several industries will be relied upon for the infrastructure improvement that is likely to occur in the years ahead.
MTX’s Momentum
MTX has steadily moved upward since November when Joe Biden was elected to the highest office in the land. The New York, NY-based company was trading at $54 in early November, jumped up to $69 by early January, hit $74 by late February, and is now knocking on the door of the $80 benchmark. It is clear that investors believe the Biden administration’s plans for infrastructure spending will benefit MTX.
MTX has a reasonable forward P/E ratio of 16.72. This forward P/E ratio is lower than most prospective investors would have expected, considering the stock is $3.50 away from its 52-week high of $81.40.
MTX’s fourth-quarter earnings and revenues exceeded estimates. Analysts anticipated MTX would post earnings of 88 cents per share. The company delivered 92 cents per share, coming in nearly 5% higher than expected. The company’s revenues for the quarter also topped analyst estimates by almost 9%.
MTX According to Analysts
Analysts believe MTX will move higher or stagnate at the worst in the weeks and months ahead, setting an average target price of $77.40. If MTX reaches this price, it will have increased by more than 1%. The analysts’ high target price for the stock is $90, while the lowest target price is $63.
Of the six analysts who have issued recommendations on MTX, four consider it a Buy, and one considers it a Strong Buy.
MTX POWR Ratings
MTX has an overall grade of B, which translates into a Buy rating in the POWR Ratings system. The company also has A grades in the Sentiment and Momentum components and B grades in the Quality and Stability components. Investors who would like to learn more about how MTX fares in the remainder of the components such as Value and Growth can do so by clicking here.
Of the 98 publicly traded companies in the Chemicals industry, MTX is ranked 28th. Click here to find other top stocks in this industry.
MTX’s Future Ascension
MTX is clearly a value stock. Though MTX might not be the best long-term investment, it should fare well across the next three years while the Biden administration hikes taxes for infrastructure spending. From an investing perspective, it certainly helps that MTX has an attractive forward P/E ratio despite its recent move up toward its 52-week high.
If you believe Biden will follow through on his promise to rebuild the country’s infrastructure, MTX is deserving of a place in your portfolio.
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MTX shares were trading at $77.50 per share on Tuesday afternoon, up $0.17 (+0.22%). Year-to-date, MTX has gained 24.85%, versus a 8.98% rise in the benchmark S&P 500 index during the same period.
About the Author: Patrick Ryan
Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...
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