One-glance verdict
Undervalued
$41.76 our estimate vs market $33.08
Wall Street consensus: $47.10 (12.8% higher than our fair-value estimate)
21% below our estimate, below the bear case
Fundamentals snapshot
Heidelberg Materials AG
HDLMY · PNK · Basic Materials · Building Materials
Current price
$33.08
52-week range
$32.66 - $57.79
Market cap
$29.08B
Balance sheet
Watch
10.66x Adequate
Net debt $8.94B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 1.4% last year.
- Reward Returns 11.7% on equity, ahead of 50% of its peers.
- Risk Net debt grew 5.3% over 3 years.
- Risk Insider ownership is only 0.0% (peer median: 0.2%).
What this company does
Heidelberg Materials AG
Heidelberg Materials sells the essential ingredients for construction projects, such as cement, aggregates (materials like sand and gravel), and ready-mixed concrete, to customers all over the world. The company earns money when new office buildings, bridges, and roads are built, which means its business success is closely tied to the overall health of the global construction industry.
How the company got here
Founded in 1873 by Johann Philipp Schifferdecker in Heidelberg, Germany, the company started as a local producer of Portland cement. Through a series of acquisitions, most notably Hanson PLC in 2007 and Italcementi in 2016, it grew into one of the world's largest building materials companies. To reflect its broader focus beyond just cement, the company changed its name from HeidelbergCement AG to Heidelberg Materials AG in 2022. This rebranding signaled a strategic shift towards sustainability and a wider range of building products.
What it actually does
Heidelberg Materials makes and sells the fundamental materials used to construct everything from houses and schools to bridges and skyscrapers. Think of them as a provider of the basic ingredients for construction projects. Their core products are cement (a powder that acts as a binder), aggregates (materials like sand, gravel, and crushed stone), and ready-mixed concrete (a combination of cement, aggregates, and water that arrives at a construction site ready to be poured). They also produce asphalt, the black material used for paving roads.
Cement
This is the company's largest business, making up about half of its sales. Cement is the key ingredient that gives concrete its strength. Heidelberg Materials produces various types of this crucial powder, which it sells to construction companies, concrete manufacturers, and other industrial users. The company operates over 100 cement plants globally, forming the backbone of its operations.
Aggregates
This segment involves quarrying and processing natural materials like sand, gravel, and crushed stone, which represent about a quarter of the company's business. These materials are essential for creating concrete and asphalt, and are also used as a base for roads and railways. Customers for these products are typically in the construction and infrastructure industries. Heidelberg Materials runs hundreds of quarries and pits to supply these fundamental building blocks.
Ready-Mixed Concrete & Asphalt
This part of the business, which accounts for roughly a quarter of sales, involves mixing cement, aggregates, and water to create concrete that is delivered to job sites ready for use. This saves construction crews the time and effort of mixing concrete on-site. The company also produces asphalt for road construction in many of its markets. This segment represents a step up in the value chain, turning basic materials into a more finished product.
What management is betting on now
The company's main focus is on sustainability and digitalization to lead in the building materials industry. Management is heavily investing in technologies like carbon capture, utilization, and storage (CCUS) to create low-carbon and even carbon-free cement. They aim for half of their revenue (money earned from sales) to come from sustainable products by 2030. The strategy also involves capitalizing on global trends like the transition to green energy, infrastructure upgrades, and the growing need for data centers, all of which require massive amounts of concrete.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $41.76 vs current price $33.08
Wall Street consensus is the average analyst price target: $47.10 (12.8% higher than our fair-value estimate).
Our most-likely fair value is $41.76 a share — about 26.3% above today's price of $33.08, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Watch
Net debt $8.9B. Interest coverage 10.7x.
Net debt
$8.94B
Interest coverage
10.66x
Heidelberg Materials AG's profit covers its interest bill about 10.7 times over. which is stronger than every peer shown here.
Watch
Worse cushion
Baseline
Better cushion
HDLMY
BASELINE
Heidelberg Materials AG
Total debt $11.45B Interest coverage 10.66x This is the baseline the peer rows are being compared against.
Total debt $19.81B Interest coverage 6.57x -38% vs HDLMY Carries about 1.6x less debt cushion than HDLMY.
Total debt $4.94B Interest coverage 6.54x -39% vs HDLMY Carries about 1.6x less debt cushion than HDLMY.
Total debt $6.34B Interest coverage 6.33x -41% vs HDLMY Carries about 1.7x less debt cushion than HDLMY.
Total debt $13.35B Interest coverage 6.30x -41% vs HDLMY Carries about 1.7x less debt cushion than HDLMY.
Total debt $6.88B Interest coverage 3.63x -66% vs HDLMY Carries about 2.9x less debt cushion than HDLMY.
What you should know
The case for and against HDLMY
3 Rewards
2 Risks
Rewards
-
Revenue grew 1.4% last year.
-
Returns 11.7% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 4/10 years.
Risks
-
Net debt grew 5.3% over 3 years.
-
Insider ownership is only 0.0% (peer median: 0.2%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
12.58x
Forward P/E
9.46x
P/B
1.34x
P/S
1.34x
EV/EBITDA
9.33x
PEG ratio
1.29x
Profitability
How much profit each dollar creates
Gross margin
64.3%
Operating margin
11.2%
Net margin
9.2%
ROE
11.7%
ROA
5.2%
Health
Liquidity and balance-sheet strength
Debt / equity
0.50x
Current ratio
1.37x
Quick ratio
0.92x
Total debt
$11.45B
Total cash
$2.52B
Growth
How the business has been compounding
Revenue TTM
$24.94B
Revenue 5Y CAGR
0.6%
EPS TTM
2.63
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$3.73B
Free CF TTM
$2.11B
FCF margin
8.5%
Dividend
Shareholder payout
Yield
2.5%
Payout ratio
31.2%
Last ex-div date
2026-05-15