Analysts with UBS Investment Research downgraded Martin Marietta Materials in a new report on fears that Republicans in Washington will scale back the nation's road building efforts as they seek to reduce spending.
UBS changed its rating from a buy to neutral on the Raleigh company, which produces rock, gravel and other materials used to build roads, subdivisions and commercial buildings.
"We see upside more limited as we think the expectation that 2011 begins a slow construction recovery is now generally priced in, and investors may not be prepared for continued political battles over road spending and other headwinds," the report states. "... we continue to like MLM shares for the longer term leverage to U.S. construction recovery."
The report cited House Republicans release of a draft of revisions to the House rules that would remove the requirement that highway trust fund dollars be used specifically for road building and maintenance.
Much of Martin Marietta's business is tied to residential, commercial and government construction projects, which makes it a barometer of the broader economy.
