Our Investment Thesis for CRH Is Firmly Intact After Fiscal 2022 Outperformance and $3Bn Buyback

Shares in narrow-moat CRH have surged 10% at the time of writing following the announcement of its full-year results, which were in line with our expectations. However, the announcement of a $3 billion share buyback has excited investors given that its capital return policy was an area, which lagged some of its peers despite CRH's superior operating performance. We attribute CRH’s superior organic profit growth of 12% to its more diversified product mix (with less exposure to energy-intensive cement production), despite similar levels of top-line growth compared with its peers. While we plan to tweak our forecasts, we don’t expect a material change to our GBX 3,950 fair value estimate. CRH remains our preferred pick in the sector due its superior outlook resulting from a significant exposure to an acceleration in U.S. infrastructure spending.