3. CRH PLC (NYSE:CRH)
Number of Hedge Fund Investors: 48
Building materials company CRH PLC (NYSE:CRH) is one of the top dividend stocks.
CRH PLC’s (NYSE:CRH) CEO Albert Manifold talked about CRH PLC’s (NYSE:CRH) dividend policy and other updates during Q3 earnings call:
“Total group sales of $26.3 billion were 8% ahead, reflecting good underlying demand and further commercial progress across our businesses. This translates into EBITDA of $4.8 billion, 14% ahead and a further 100 basis points of margin improvement, a strong performance despite [containing] but some inflationary cost pressures. This morning, we’ve announced an agreement to acquire an attractive portfolio cement and readymix concrete assets in Texas for $2.1 billion, a significant investment which will deliver further growth and value creation for our shareholders. I’ll take you through that in further a little later presentation. We also continue to return significant amounts of cash to our shareholders through dividends and share buybacks. Our ongoing share buyback program is on track to return approximately $3 billion in 2023 and the current tranche of the program will be completed before the end of the year.
In advance of our indented transition to quarterly dividends in 2024 and consistent with our progressive dividend policy and strong financial position, this morning, we have announced an accelerated payment of our 2023 dividend, representing a 5% increase compared to the prior year. Looking ahead to the remainder of the year and based on current trading conditions at the momentum we see across our businesses, I’m pleased to report that we are raising our previous guidance and expect to deliver full year group EBITDA of approximately $6.3 billion well ahead of the prior year and representing another record year for CRH.”
Read the entire earnings call transcript here.
Here is what Voss Capital has to say about CRH plc (NYSE:CRH) in its Q3 2023 investor letter:
“While the market has recently been focused on GPU chips and AI scripts, our attention has been on cement blocks and crushed rocks. We’ve enthusiastically made CRH one of our largest positions ever at cost due to its limited downside. CRH is among the largest aggregates and infrastructure companies in the United States and Europe and has recently relisted to the NYSE from the LSE, which we believe will be a catalyst for the stock to rerate upwards towards peer valuations as its undeniable value hiding in plain sight becomes more widely discussed.
In 1970, Cement Limited and Roadstone Limited, two Irish infrastructure-focused companies, combined to form Cement and Roadstone Holdings, or “CRH.” An investment of $1 million into CRH upon its founding since that fateful merger ~53 years ago would have turned into ~$1.5 billion by mid-year 2023, an annualized total return to investors of 15.0%, a high rate of compounding we think can continue.
Half a century of success at CRH has been driven by disciplined operations and capital allocation that we believe derives from a company culture built around appropriate financial incentives. CRH’s M&A playbook has proven to be successful as an acquisitive company like CRH can’t compound at a rate of 15% over 50 years unless acquisitions and divestitures have been executed at attractive prices. Over the last five years, CRH has spent $10.3 billion on acquisitions while receiving $10.5 billion in proceeds from divestitures across dozens of transactions, with the average acquisition multiple ranging from 7x – 8x EBITDA depending on the year and the average exit multiple clocking in at 11x EBITDA.”
