The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Masco (NYSE:MAS) and the rest of the home construction materials stocks fared in Q4.
Traditionally, home construction materials companies have built economic moats with expertise in specialized areas, brand recognition, and strong relationships with contractors. More recently, advances to address labor availability and job site productivity have spurred innovation that is driving incremental demand. However, these companies are at the whim of residential construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates. Additionally, the costs of raw materials can be driven by a myriad of worldwide factors and greatly influence the profitability of home construction materials companies.
The 12 home construction materials stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 1.5%.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 18.1% since the latest earnings results.
Masco (NYSE:MAS)
Headquartered just outside of Detroit, MI, Masco (NYSE:MAS) designs and manufactures home-building products such as glass shower doors, decorative lighting, bathtubs, and faucets.
Masco reported revenues of $1.83 billion, down 2.9% year on year. This print fell short of analysts’ expectations by 0.5%. Overall, it was a mixed quarter for the company with organic revenue in line with analysts’ estimates but full-year EPS guidance missing analysts’ expectations.
“We delivered another quarter of strong operating results,” said Keith Allman, Masco’s President and Chief Executive Officer.
The stock is down 20% since reporting and currently trades at $62.07.
Read our full report on Masco here, it’s free.
Best Q4: Owens Corning (NYSE:OC)
Credited with the discovery of fiberglass, Owens Corning (NYSE:OC) supplies building and construction materials to the United States and international markets.
Owens Corning reported revenues of $2.84 billion, up 23.3% year on year, outperforming analysts’ expectations by 2.7%. The business had a stunning quarter with a solid beat of analysts’ organic revenue and EBITDA estimates.
The stock is down 19.1% since reporting. It currently trades at $133.98.
Is now the time to buy Owens Corning? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: American Woodmark (NASDAQ:AMWD)
Starting as a small millwork shop, American Woodmark (NASDAQ:AMWD) is a cabinet manufacturing company that helps customers from inspiration to installation.
American Woodmark reported revenues of $397.6 million, down 5.8% year on year, falling short of analysts’ expectations by 3.3%. It was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
As expected, the stock is down 18.9% since the results and currently trades at $57.68.
Read our full analysis of American Woodmark’s results here.
Simpson (NYSE:SSD)
Aiming to build safer and stronger buildings, Simpson (NYSE:SSD) designs and manufactures structural connectors, anchors, and other construction products.
Simpson reported revenues of $517.4 million, up 3.1% year on year. This number topped analysts’ expectations by 4.3%. It was an exceptional quarter as it also recorded a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ EPS estimates.
The stock is down 12.3% since reporting and currently trades at $146.30.
Read our full, actionable report on Simpson here, it’s free.
Quanex (NYSE:NX)
Starting in the seamless tube industry, Quanex (NYSE:NX) manufactures building products like window, door, kitchen, and bath cabinet components.
Quanex reported revenues of $400 million, up 67.3% year on year. This result beat analysts’ expectations by 4.6%. Overall, it was an exceptional quarter as it also produced a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Quanex achieved the fastest revenue growth among its peers. The stock is down 14.7% since reporting and currently trades at $17.44.
Read our full, actionable report on Quanex here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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