Nearly two years to the date from its spinoff by Centex Corp., Dallas-based Eagle Materials outlined a plan to combine its Common Stock and Class B Common Stock on a one-to-one basis, then effect a three-for-one split in the form of a 200% stock dividend to be distributed this month. The plan was announced the morning of Jan. 25; later that day, after New York Stock Exchange trading had closed, the company reported that its fiscal third quarter profit had increased 51%, while its fiscal 2007 outlook was much brighter than previously expected.

The rosy projection prompted a trading surge the following day, with the stock climbing from $128.97 to $163.51/share. The stock gained an additional $7 to close at $170.40 on January 30, although shares retreated to the $150-$162 range in the days that followed, and closed Feb. 3 at $162-$163. The stock rose more than 35% for the month and has gained about 100% since January 2005.

Along with the stock split and strong 2006 projections, Eagle Materials announced plans to invest $320 million to expand its Mountain Cement (Laramie, Wyo.) and Nevada Cement (Fernley) plants to 1.1 million tons each, representing capacity increases of 60% and 100%, respectively. The expansions are scheduled to be operational by fall 2008, and occur on the heels of a capacity upgrade at Eagle's Illinois Cement plant (LaSalle), pacing a December 2006 completion.

The projects will bring the company's annual milling capability to 4 million tpy, up from a current 2.65 million tpy. In addition to the Illinois, Mountain, Nevada properties, Eagle is a partner in Texas Lehigh Cement (Buda). The company has ready mixed operations strategic to the Texas Lehigh and Nevada plants.