Vulcan Materials sales and profit drop in Q3, but will fundamentals improve?

But should it have been? These decreases are illustrative of the rough time that Vulcan Materials, which makes materials for the construction industry, is having during this period of economic uncertainty. Indeed, the stock is well off its 52-week high.

Shareholders can take some comfort from the statement of cash flows, however. Net cash from operations for the nine-month frame grew by 28%. Plus, the amount of cash generated was more than enough for both capital investments and dividend payments. As a matter of fact, I like the cash flow a lot better this time around than when I last covered Vulcan Materials back in the summer.

If you buy now and hold for a long-term period, you probably will be all right (although nothing is guaranteed, I hasten to add). Vulcan Materials should continue to improve as the recession fades. Joesph Lazzaro made this point, and I believe his thinking is correct.

However, I'm not so fond of the six-month chart right now. So, for those who trade more frequently than they invest, I would be cautious. Some might look at the chart and see a buying opportunity, but my own interpretation is that there could be some risk for short-term money.

Disclosure: I don't own any company mentioned; positions can change without notice.