The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how home construction materials stocks fared in Q4, starting with Simpson (NYSE:SSD).
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 17.6% since the latest earnings results.
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 print exceeded analysts’ expectations by 4.3%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ EBITDA estimates and a decent beat of analysts’ EPS estimates.
"During 2024, we grew revenues modestly in a challenging year where housing starts in both the U.S. and Europe declined," commented Mike Olosky, President and Chief Executive Officer of Simpson Manufacturing Co.,
The stock is down 13% since reporting and currently trades at $145.24.
Is now the time to buy Simpson? Access our full analysis of the earnings results 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 19.7% since reporting. It currently trades at $133.
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 and a significant miss of analysts’ adjusted operating income estimates.
As expected, the stock is down 21% since the results and currently trades at $56.23.
Read our full analysis of American Woodmark’s results here.
Griffon (NYSE:GFF)
Initially in the defense industry, Griffon (NYSE:GFF) is a now diversified company specializing in home improvement, professional equipment, and building products.
Griffon reported revenues of $632.4 million, down 1.7% year on year. This result came in 0.8% below analysts' expectations. Aside from that, it was a very strong quarter as it recorded an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ EPS estimates.
The stock is down 4.5% since reporting and currently trades at $70.99.
Read our full, actionable report on Griffon here, it’s free.
Trex (NYSE:TREX)
Addressing the demand for aesthetically-pleasing and unique outdoor living spaces, Trex Company (NYSE:TREX) makes wood-alternative decking, railing, and patio furniture.
Trex reported revenues of $167.6 million, down 14.4% year on year. This number surpassed analysts’ expectations by 4.4%. Overall, it was a stunning quarter as it also logged an impressive beat of analysts’ organic revenue estimates and a solid beat of analysts’ EPS estimates.
Trex had the slowest revenue growth among its peers. The stock is down 13.4% since reporting and currently trades at $53.44.
Read our full, actionable report on Trex here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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