Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Gibraltar (NASDAQ:ROCK) and the best and worst performers in the home construction materials industry.
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 Q2. As a group, revenues missed analysts’ consensus estimates by 0.9% while next quarter’s revenue guidance was in line.
In light of this news, share prices of the companies have held steady as they are up 4.8% on average since the latest earnings results.
Weakest Q2: 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 $309.5 million, up 13.1% year on year. This print fell short of analysts’ expectations by 17.9%. Overall, it was a disappointing quarter for the company with full-year revenue guidance missing analysts’ expectations.
“We executed well in the second quarter with adjusted net sales up 14% and adjusted EPS up 11%, and we generated $44 million of operating cash flow as we had strong performance from our recently acquired metal roofing and structures businesses and we delivered market participation gains in building accessories,” stated Chairman and CEO Bill Bosway.
Gibraltar delivered the weakest performance against analyst estimates and weakest full-year guidance update of the whole group. Unsurprisingly, the stock is down 6.1% since reporting and currently trades at $60.44.
Read our full report on Gibraltar here, it’s free.
Best Q2: 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 $2.05 billion, down 1.9% year on year, outperforming analysts’ expectations by 2.5%. The business had a stunning quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.
The market seems happy with the results as the stock is up 13% since reporting. It currently trades at $74.30.
Is now the time to buy Masco? Access our full analysis of the earnings results 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 $495.3 million, up 76.7% year on year, exceeding analysts’ expectations by 0.5%. Still, it was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
As expected, the stock is down 29.9% since the results and currently trades at $14.63.
Read our full analysis of Quanex’s results here.
Fortune Brands (NYSE:FBIN)
Targeting a wide customer base of residential and commercial customers, Fortune Brands (NYSE:FBIN) makes plumbing, security, and outdoor living products.
Fortune Brands reported revenues of $1.20 billion, down 3% year on year. This print met analysts’ expectations. Overall, it was a strong quarter as it also put up full-year EPS guidance exceeding analysts’ expectations and an impressive beat of analysts’ EBITDA estimates.
The stock is up 11.8% since reporting and currently trades at $61.21.
Read our full, actionable report on Fortune Brands here, it’s free.
Hayward (NYSE:HAYW)
Credited with introducing the first variable-speed pool pump, Hayward (NYSE:HAYW) makes residential and commercial pool equipment and accessories.
Hayward reported revenues of $299.6 million, up 5.3% year on year. This result surpassed analysts’ expectations by 3.4%. It was a strong quarter as it also produced a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.
The stock is up 6.1% since reporting and currently trades at $15.86.
Read our full, actionable report on Hayward 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.
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