As the craze of earnings season draws to a close, here's a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at home construction materials stocks, starting with Builders FirstSource (NYSE:BLDR).
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 11 home construction materials stocks we track reported an ok Q1; on average, revenues were in line with analyst consensus estimates. while next quarter's revenue guidance was 2.3% above consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, and home construction materials stocks have had a rough stretch, with share prices down 5.7% on average since the previous earnings results.
Builders FirstSource (NYSE:BLDR) Headquartered in Irving, TX, Builders FirstSource (NYSE:BLDR) is a construction materials manufacturer that offers a variety of lumber and lumber-related building products.
Builders FirstSource reported revenues of $3.89 billion, flat year on year, exceeding analysts' expectations by 1.7%. Overall, it was an ok quarter for the company with a solid beat of analysts' earnings estimates but a miss of analysts' Windows, doors & millwork revenue estimates.
“Our resilient first quarter results reflect our differentiated product portfolio and scale, our team members' consistent focus on executing our strategic priorities, and our operational efficiency initiatives,” commented Dave Rush, CEO of Builders FirstSource.
The stock is down 23.7% since reporting and currently trades at $153.30.
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Best Q1: 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 $672.9 million, down 5.4% year on year, outperforming analysts' expectations by 7.6%. It was an incredible quarter for the company with an impressive beat of analysts' earnings estimates.
Griffon scored the biggest analyst estimates beat among its peers. Although it had a great quarter compared its peers, the market seems unhappy with the results as the stock is down 1.5% since reporting. It currently trades at $66.74.
Weakest Q1: Masonite (NYSE:DOOR) A company that has specialized in making doors for an entire century, Masonite (NYSE:DOOR) designs and manufactures indoor and outdoor doors for residential and commercial markets.
Masonite reported revenues of $668.3 million, down 7.9% year on year, falling short of analysts' expectations by 6.5%. It was a weak quarter for the company with a miss of analysts' earnings and volume estimates.
Masonite posted the weakest performance against analyst estimates in the group. The stock is flat since the results and currently trades at $133.02.
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 $373.6 million, up 56.5% year on year, surpassing analysts' expectations by 1.7%. Taking a step back, it was a strong quarter for the company with an impressive beat of analysts' organic revenue estimates and a solid beat of analysts' earnings estimates.
Trex scored the fastest revenue growth among its peers. The stock is down 12.7% since reporting and currently trades at $81.55.
Gibraltar (NASDAQ:ROCK) Gibraltar (NASDAQ:ROCK) makes renewable energy, agriculture technology and infrastructure products. Its mission statement is to make everyday living more sustainable.
Gibraltar reported revenues of $292.5 million, flat year on year, falling short of analysts' expectations by 1.6%. Overall, it was a slower quarter for the company with some shareholders hoping for a better result.
The stock is up 2.4% since reporting and currently trades at $73.20.
This content was originally published on Stock Story
