Earnings call transcript: Loma Negra Q1 2026 sees revenue beat, EPS miss

Loma Negra reported Q1 2026 revenue of $154 million, beating estimates by 56.1%, while EPS of $0.0526 slightly missed the $0.0529 consensus; shares rose 4.3% premarket to $10.61. Adjusted EBITDA increased 5.1% to $45 million and margin expanded 94 bps to 24.9%, with net profit up 43.9% year over year to ARS 41 billion. Management guided to roughly high-single-digit volume growth for 2026 and said margins should hold at current levels or improve, though weather, pricing pressure in concrete, and fuel costs remain risks.

Analysis

LOMA’s print is less about a clean volume inflection than a margin reset enabled by self-help. The key second-order effect is that lower leverage plus a newly refinanced maturity wall gives management a much wider operating runway: when demand is choppy, that combination tends to let the best-capitalized domestic producer defend price instead of chasing share, which can extend industry rationality into the second half of the year. The market is still pricing this as a cyclical one-quarter beat, but the more important signal is that earnings quality improved even as the company absorbed a weaker mix in exposed segments.

The near-term setup is asymmetric because weather and fuel are working in opposite directions. April weakness from rain is likely a transitory optics issue, but higher diesel and freight costs can bleed into margins with a lag, especially in the more price-sensitive concrete and aggregates businesses. That said, LOMA’s own fuel exposure is partially cushioned by natural-gas-linked production costs, so the bigger risk is not direct input inflation but whether competitors pass through freight pressure faster or choose to absorb it, creating temporary pricing dispersion.

The consensus is probably underestimating how much of the quarter’s margin expansion is structural rather than cyclical. If inflation stays moderate and monthly price resets become less frequent, the winner will be the operator with the strongest cost discipline and balance sheet, because pricing power shifts from nominal indexation to relative value capture. On the flip side, the valuation remains vulnerable if construction demand fails to re-accelerate by Q3: at that point, the market will start discounting the current margin level as peak-like rather than durable, and the stock’s upside will be capped by already rich multiples.

Key Decisions for Investors

• Long LOMA on a 1-3 month horizon into Q2 numbers: target a continuation move if management proves margins hold despite April weather noise; risk/reward is attractive only if you size for valuation compression, not multiple expansion.
• Pair trade: long LOMA / short a higher-beta Argentine construction or materials name with weaker balance sheet and no FX liability hedge; the trade expresses relative pricing power and funding advantage if domestic demand stays uneven.
• Sell out-of-the-money LOMA calls against a long spot position for the next 60-90 days: monetizes elevated implied optimism after the premarket move while retaining upside if margins are sustained.
• If entering new longs, wait for post-rain volume data and any pullback toward the mid-teens support area before adding; the cleaner catalyst is confirmation of May dispatch recovery, not the headline Q1 beat.
• Avoid chasing the move outright at current levels unless you have conviction on a second-half Argentine construction rebound; otherwise the risk/reward skews against fresh longs because the stock already discounts a fair amount of operational improvement.