Baron Asset Fund Bets on Vulcan Materials Company’s (VMC) Attractive Long-Term Growth Potential

1 hour ago 1

Soumya Eswaran

Thu, May 14, 2026 astatine 9:41 AM CDT 3 min read

Baron Capital, an concern absorption company, released its Q1 2026 capitalist missive for the “Baron Asset Fund”. A transcript of the missive is disposable to download here. U.S. equity markets started the twelvemonth connected a affirmative note. In February, marketplace dynamics changed owed to concerns astir AI disruption, accelerated by U.S. and Israeli subject enactment successful Iran successful March, raising fears of higher lipid prices. The Fund declined 7.81% (Institutional Shares) for the quarter, versus a 6.35% diminution successful the Russell Midcap Growth Index. Performance was adversely impacted by overexposure to the bundle and services sectors and underexposure to the vigor industries. Despite this, the Firm remains optimistic astir the marketplace recognizing high-quality businesses owned by the Fund, fixed their resilience against perceived AI threats. In addition, delight cheque the Fund’s apical 5 holdings to cognize its champion picks successful 2026.

In its first-quarter 2026 capitalist letter, Baron Asset Fund highlighted Vulcan Materials Company (NYSE:VMC) arsenic a recently added position. Vulcan Materials Company (NYSE:VMC) is simply a US-based shaper and supplier of operation aggregates. On May 13, 2026, Vulcan Materials Company (NYSE:VMC) closed astatine $274.54 per share. One-month instrumentality of Vulcan Materials Company (NYSE:VMC) was -3.93%, and its shares gained 1.28% implicit the past 52 weeks. Vulcan Materials Company (NYSE:VMC) has a marketplace capitalization of $35.62 billion.

Baron Asset Fund stated the pursuing regarding Vulcan Materials Company (NYSE:VMC) successful its Q1 2026 capitalist letter:

"Vulcan Materials Company (NYSE:VMC) supplies the basal earthy materials required for astir operation and infrastructure development. Vulcan is the largest shaper of operation aggregates successful the U.S., generating astir 90% of its gross nett from mining, processing, and transporting crushed stone, sand, and gravel (collectively, “aggregates”) from quarries that it owns. The equilibrium of its gross nett is derived from strategically located ready-mix factual and asphalt. Vulcan’s products are sold and utilized successful infrastructure projects specified arsenic roads, highways and bridges, arsenic good arsenic successful residential and non-residential construction.

We judge that aggregates are an charismatic concern due to the fact that of the industry’s precocious barriers to introduction and beardown pricing trends. Permits to unfastened caller quarries are hard to obtain, and the support process typically takes 5 to 10 years. This limits caller contention and keeps proviso constrained, which puts the companies that ain existing quarries successful an advantageous position. In addition, a precocious weight-to-price ratio makes proscription costly comparative to the outgo of the aggregates, limiting the region that materials tin beryllium shipped economically. As a result, aggregates producers person historically enjoyed important pricing power. In the past 30 years, pricing of aggregates has increased, connected average, 4% per year…” (Click present to work the afloat text)

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