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 JELD-WEN (NYSE:JELD) and the rest of the home construction materials stocks fared in Q1.
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 13 home construction materials stocks we track reported an ok Q1; on average, revenues beat analyst consensus estimates by 0.5%. while next quarter's revenue guidance was 2.3% above consensus. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and while some of the home construction materials stocks have fared somewhat better than others, they collectively declined, with share prices falling 0.3% on average since the previous earnings results.
JELD-WEN (NYSE:JELD) Founded in the 1960s as a general wood-making company, JELD-WEN (NYSE:JELD) manufactures doors, windows, and other related building products.
JELD-WEN reported revenues of $959.1 million, down 11.2% year on year, in line with analysts' expectations. Overall, it was an ok quarter for the company with a solid beat of analysts' earnings estimates but a miss of analysts' organic revenue estimates.
"We continue to execute on our transformation journey and position JELD-WEN for improved performance," said Chief Executive Officer William J. Christensen.
JELD-WEN delivered the slowest revenue growth of the whole group. The stock is down 15.4% since reporting and currently trades at $16.10.
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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 delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 8.2% since reporting. It currently trades at $73.34.
Weakest Q1: 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 $530.6 million, flat year on year, falling short of analysts' expectations by 2.6%. It was a weak quarter for the company with a miss of analysts' earnings estimates.
The stock is flat since the results and currently trades at $186.13.
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%. Taking a step back, it was a weak quarter for the company with a miss of analysts' earnings and volume estimates.
Masonite had the weakest performance against analyst estimates among its peers. The stock is flat since reporting and currently trades at $133.02.
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, surpassing analysts' expectations by 1.7%. Overall, it was an ok quarter for the company with a dedcent beat of analysts' earnings estimates.
The stock is down 17.3% since reporting and currently trades at $166.
This content was originally published on Stock Story
