CRH

CRH is a high-quality cyclical executing exceptionally well. FY2025 was a record: revenue grew 5.3% to $37.4B and the profit mix improved faster than the top line — operating income +10.5%, diluted EPS +9.8% to $5.51, and Adjusted EBITDA margin expanded 100bps to 20.5% (net margin 10.0%). The five-year history is steady and durable ($29.2B→$37.4B revenue, net income $2.63B→$3.75B), exactly the consistent profitable growth this lens rewards. Cash generation is the standout: operating cash flow rose 12.7% to $5.63B (148% of net income) and management cites Adjusted Free Cash Flow of $5.0B at 131% conversion — funding a 6% dividend hike ($1.48/share), $1.2B of buybacks (shares -1.2%), and bolt-on M&A simultaneously. ROE of 15.6% on a 1.37x liabilities/equity balance sheet is healthy for a capital-intensive materials business.

The stock is reasonably, not cheaply, priced: 19.8x trailing EPS and 1.9x sales for a business compounding earnings high-single to low-double digits with margin tailwinds. CRH is positioned squarely in the structural demand themes it names — transportation, water and reindustrialization infrastructure across North America, Europe and Australia — and its scale and local density give it real pricing power, evidenced by margins rising while revenue growth moderated. At ~22x the current $5.51 EPS the shares are worth roughly $122, modest upside plus a ~1.4% dividend, with the buyback steadily shrinking the share count.