BofA raises Loma Negra stock price target on cement growth outlook

BofA raised Loma Negra’s price target to $14.50 from $14.00 while reiterating a Buy, implying 37% upside from the $10.61 share price and 450bps lower Argentina country risk premium. The firm also lifted 2026 cement volume growth expectations to 7.5% from 7% after stronger March volumes and improving second-half 2026 recovery prospects. Separately, Loma Negra’s Q4 2025 revenue of $153.5 million beat consensus by 24.85%, though the stock still traded lower in premarket.

Analysis

The real signal here is not the target raise; it is that the market is beginning to re-rate Argentina cyclicals on the assumption that macro volatility is no longer uniformly punitive. For a dollar-earnings asset like LOMA, a lower country risk premium can dominate modest operating revisions, so the stock’s upside is more about discount-rate compression than volume growth alone. That makes the move fragile: if FX or sovereign spreads widen again, the valuation case can unwind faster than the operating model can adjust.

Second-order, a stronger construction-volume print is a read-through for other local industrials and materials names that have been priced as if demand recovery would remain lumpy. If this acceleration holds into the next quarter, suppliers with operating leverage and low dollar debt should outperform because incremental volume drops disproportionately to EBITDA in an inflationary environment. The flip side is that the market may be underestimating how much of the equity value is hostage to policy and currency assumptions rather than end-demand fundamentals.

The consensus may be too focused on whether the recovery is ‘real’ and not enough on whether it is already embedded in the ADR. A high multiple with estimate revisions driven partly by macro inputs leaves limited margin of safety if inflation, rates, or FX projections move the wrong way. In other words, the trade works best as a short-duration sentiment/discount-rate bet, not a long-duration fundamental compounder.

Key Decisions for Investors

• Long LOMA tactically for 2-6 weeks only, using size small enough to survive FX-driven gap risk; treat it as a discount-rate trade, not a core hold.
• Use call spreads instead of outright stock long on LOMA to capture further multiple expansion while capping downside if Argentina risk premium widens again over the next 1-3 months.
• Pair trade: long LOMA / short a higher-quality EM industrial or materials name with less valuation support, to isolate country-risk compression from global beta over the next quarter.
• Take profits aggressively if LOMA re-rates into the low-to-mid teens on the ADR, because the upside becomes increasingly dependent on continued sovereign spread tightening rather than operations.
• Avoid chasing LOMA after large up-days; wait for a 3-5% pullback or a negative macro tape to enter, since the stock is likely to trade with sharp beta to Argentina FX and rates.