Armstrong World Indus (NYSE:AWI) 주식

ARMSTRONG WORLD INDUSTRIES

Armstrong World Indus

Armstrong World Industries Inc. designs, innovates, and manufactures ceiling and wall solutions in the Americas. The company manufactures and sources products made of numerous materials, including mineral fiber, fiberglass, metal, felt, wood, resin, wood fiber, and glass-reinforced-gypsum. It also manufactures ceiling suspension system (grid) products through a joint venture with Worthington Industries, Inc., called Worthington Armstrong Venture (WAVE). The company's reportable operating segments include Mineral Fiber, Architectural Specialties, and Unallocated Corporate. A majority of its revenue is generated from the Mineral Fiber segment, which produces suspended mineral fiber and fiberglass ceiling systems. Geographically, it derives maximum revenue from the United States.

Armstrong World Industries Inc Common Stock

Armstrong World Industries Inc

AERWINS TECHNOLOGIES INC by AERWINS Technologies Inc.

AERWINS Technologies Inc

AERWINS Technologies Inc Warrants(03/02/2028)

AWILCO DRILLING LTD by Awilco Drilling Ltd.

Awilco Drilling PLC

Awilco LNG ASA

Goldman Sachs analyst Susan Maklari maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Buy and raises the price target from $163 to $180.

News

Price Target

Analyst Ratings

Goldman Sachs Maintains Buy on Armstrong World Indus, Raises Price Target to $180

Truist Securities analyst Keith Hughes maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Buy and raises the price target from $162 to $175.

Truist Securities Maintains Buy on Armstrong World Indus, Raises Price Target to $175

UBS analyst John Lovallo maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Neutral and raises the price target from $150 to $158.

UBS Maintains Neutral on Armstrong World Indus, Raises Price Target to $158

WIIM

Armstrong World Industries shares are trading higher after the company reported better-than-expected Q4 financial results.

Guidance

Armstrong World Indus Sees FY25 Adj EPS Guidance Of $6.85-$7.15 Vs $6.87 Est, Net Sales Of 	$1.57B-$1.61B Vs. $1.54B Est.

Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) reported quarterly earnings of $1.50 per share which beat the analyst consensus estimate of $1.38 by 8.7 percent. This is a 22.95 percent increase over earnings of $1.22 per share from the same period last year. The company reported quarterly sales of $367.70 million which beat the analyst consensus estimate of $352.09 million by 4.43 percent. This is a 17.74 percent increase over sales of $312.30 million the same period last year.

Earnings

Earnings Beats

Armstrong World Indus Q4 2024 Adj EPS $1.50 Beats $1.38 Estimate, Sales $367.70M Beat $352.09M Estimate

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Earnings Scheduled For February 25, 2025

Armstrong World Industries, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) reported better-than-expected earnings <a href="https://www.benzinga.com/quote/awi/earnings">for the third quarter on Tuesday.</a>
The company posted quarterly earnings of $1.81 per share which beat the analyst consensus estimate of $1.75 per share. The company reported quarterly sales of $386.60 million which missed the analyst consensus estimate of $386.69 million.
&#8220;With another quarter of record setting sales and strong earnings growth, we continue to demonstrate our ability to deliver growth despite muted market conditions through operational execution and our investments in strategic acquisitions, innovation and digital initiatives,&#8221; said Vic Grizzle, President and CEO of Armstrong World Industries. &#8220;As market demand continues to stabilize, we are well positioned to deliver full year double-digit top and bottom-line growth with industry-leading margin performance through strong Mineral Fiber Average Unit Value improvement, market-driven innovation, operational excellence and Architectural Specialties growth.&#8221;
Armstrong World raised its FY24 adjusted earnings guidance from $6.00-$6.15 to $6.15-$6.25 per share.
Armstrong World shares gained 0.8% to trade at $141.09 on Wednesday.
These analysts made changes to their price targets on Armstrong World following earnings announcement.
<ul>
<li><a href="https://www.benzinga.com/analyst-stock-ratings/analyst/588b3f4b77f9dd000146088c/john-lovallo">UBS analyst John Lovallo</a> maintained Armstrong World Indus with a Neutral and raised the price target from $136 to $144.</li>
<li>Evercore ISI Group analyst Stephen Kim maintained the stock with a In-Line and raised the price target from $127 to $140.</li>
<li>Truist Securities analyst Keith Hughes maintained Armstrong World Indus with a Buy and raised the price target from $148 to $162.</li>
<li>Loop Capital analyst Garik Shmois maintained the stock with a Hold and raised the price target from $135 to $145.</li>
</ul>
Considering buying AWI stock? Here&#8217;s what analysts think: 
<figure class="wp-block-image size-large is-resized"><img loading="lazy" decoding="async" width="1024" height="528" src="https://editorial-assets.benzinga.com/wp-content/uploads/2024/10/30142432/image-315-1024x528.png" alt="" class="wp-image-622501" style="width:570px;height:auto" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2024/10/30142432/image-315-1024x528.png 1024w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/10/30142432/image-315-300x155.png 300w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/10/30142432/image-315-768x396.png 768w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/10/30142432/image-315.png 1246w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>
Read More: 
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<li><a href="https://www.benzinga.com/trading-ideas/long-ideas/24/10/41599928/top-3-tech-and-telecom-stocks-which-could-rescue-your-portfolio-for-october">Top 3 Tech And Telecom Stocks Which Could Rescue Your Portfolio For October</a></li>
</ul>

Markets

Trading Ideas

These Analysts Boost Their Forecasts On Armstrong World Industries Following Better-Than-Expected Earnings

Loop Capital analyst Garik Shmois maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Hold and raises the price target from $135 to $145.

Loop Capital Maintains Hold on Armstrong World Indus, Raises Price Target to $145

Truist Securities analyst Keith Hughes maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Buy and raises the price target from $148 to $162.

Truist Securities Maintains Buy on Armstrong World Indus, Raises Price Target to $162

Evercore ISI Group analyst Stephen Kim maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a In-Line and raises the price target from $127 to $140.

Evercore ISI Group Maintains In-Line on Armstrong World Indus, Raises Price Target to $140

UBS analyst John Lovallo maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Neutral and raises the price target from $136 to $144.

UBS Maintains Neutral on Armstrong World Indus, Raises Price Target to $144

Armstrong World Indus Raises FY24 GAAP EPS Guidance from $5.76-$5.87 to $5.91-$5.95 vs $5.96 Est

Armstrong World Indus Raises FY24 Adj EPS Guidance from $6.00-$6.15 to $6.15-$6.25 vs $6.09 Est

Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) reported quarterly earnings of $1.81 per share which beat the analyst consensus estimate of $1.75 by 3.43 percent. This is a 13.12 percent increase over earnings of $1.60 per share from the same period last year. The company reported quarterly sales of $386.60 million which missed the analyst consensus estimate of $386.69 million by 0.02 percent. This is a 11.32 percent increase over sales of $347.30 million the same period last year.

Earnings Misses

Armstrong World Indus Q3 2024 Adj EPS $1.81 Beats $1.75 Estimate, Sales $386.60M Miss $386.7M Estimate

The dividend will be paid on November 21, 2024, to stockholders of record as of the close of business on November 7, 2024.

Dividends

Armstrong World Industries Boosts Quarterly Cash Dividend By 10% From $0.28 To $0.308 Per Share

Jefferies analyst Philip Ng maintains Armstrong World Indus (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AWI#NYSE">AWI</a>) with a Hold and raises the price target from $121 to $122.

Jefferies Maintains Hold on Armstrong World Indus, Raises Price Target to $122

Arcosa, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/aca#NYSE">ACA</a>) recently acquired the construction materials business of Stavola Holding Corporation and its affiliated entities (Stavola) for $1.2 billion.
This apart, ACA completed the previously announced sale of its steel components business on Aug. 16, 2024.
<h2>Buyout Synergies</h2>
The acquisition was funded with a $600 million 6.875% Senior Note issuance (due 2032), which closed on Aug. 26, 2024, and a pre-payable $700 million variable-rate senior secured Term Loan B Facility (due 2031), which was funded concurrently with the closing of the transaction. Excess cash proceeds will be used to pay down borrowings on the company&#39;s revolving credit facility.
For third-quarter 2024, the company expects adjusted EBITDA to be within $1-$1.5 million loss, reflecting a partial period of ownership that was impacted by the deferral of certain product shipments and business interruption from actions necessary to complete the divestiture process. Moreover, Arcosa plans to update its 2024 revenue and adjusted EBITDA guidance for the completion of these transactions at third-quarter earnings release.
The company anticipates deploying strong free cash flow to return to its net leverage target of 2.0-2.5X within 18 months.
<h2>About Stavola</h2>
Founded in 1948, Stavola is an aggregates-led and vertically integrated construction materials company. It primarily serves the New York-New Jersey Metropolitan Statistical Area&nbsp;through its network of five hard rock natural aggregates quarries, 12 asphalt plants and three recycled aggregates sites.
In the past 12 months (ended June 30, 2024), Stavola generated revenues of $283 million and adjusted EBITDA of $100 million, representing an adjusted EBITDA margin of 35%. Of the total adjusted EBITDA, 56% was contributed by the aggregates business. This is expected to create tax benefits attributable to Arcosa with a net present value of nearly $125 million.
Antonio Carrillo, president and chief executive officer of ACA, stated, &quot;These transactions significantly advance our strategy of growing in attractive markets while reducing the cyclicality and complexity of our overall portfolio. Stavola underscores our aggregates-led acquisition strategy, expanding our platform into the nation&#39;s largest MSA with industry-leading financial attributes.&quot;
<h2>ACA&#39;s Stock Performance</h2>
Shares of this Zacks Rank #3 (Hold) company have soared 11.6% in the past six months compared with the Zacks Building Products - Miscellaneous industry&#39;s 6.6% growth. Solid contributions from its Construction Products and Engineered Structures segments boosted growth. A boost in infrastructural and public construction spending, along with a renewable energy drive, should improve Arcosa&#39;s growth.
<img alt="Zacks Investment Research" src="https://staticx-tuner.zacks.com/images/articles/charts/17/80058.jpg?v=925353102" />
Image Source: Zacks Investment Research
Arcosa strategically pursued two acquisitions in the first half of 2024, significantly bolstering its performance. In August, the company entered into a deal with an affiliate of Stellex Capital Management, a middle-market private equity firm, to sell its McConway &amp; Torley and Standard Forged Products businesses.
These inorganic moves align with Arcosa&#39;s long-term growth strategy, aiming to capitalize on opportunities in key markets and sectors. As the company continues to integrate these acquisitions, it anticipates further synergies and operational efficiencies, thus driving value for shareholders.
In a nutshell, Arcosa&#39;s strategic acquisitions have positioned it for sustained growth and market leadership in the construction products sector, underscoring its commitment to delivering innovative solutions and creating value for stakeholders.
<h2>Key Picks</h2>
Latham Group, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/swim#NASDAQ">SWIM</a>): Based in Latham, NY, the company stands as the leading designer, manufacturer and marketer of in-ground residential swimming pools and pool accessories. It presently sports a Zacks Rank #1 (Strong Buy).
SWIM has seen an upward estimate revision for 2024 earnings per share to 13 cents from break-even over the past 60 days. The estimated figure indicates 750% year-over-year growth.
Armstrong World Industries, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/awi#NYSE">AWI</a>): Based in Lancaster, PA, Armstrong World is a leading global manufacturer of ceiling systems primarily for commercial, institutional and residential building construction and renovation. It presently carries a Zacks Rank #2 (Buy).
AWI has seen an upward estimate revision for 2024 EPS to $6.07 from $6.02 over the past 60 days. The estimated figure indicates 14.1% year-over-year growth.
Frontdoor, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/ftdr#NASDAQ">FTDR</a>): Based in Memphis, TN, this company provides home warranties in the United States. It presently carries a Zacks Rank of 2.
FTDR has seen an upward estimate revision for 2024 EPS to $2.79 from $2.64 over the past 60 days. The estimated figure indicates 21.3% year-over-year growth.
<a href="https://www.zacks.com/stock/news/2344956/arcosa-acquires-stavola-for-1-2b-divests-steel-components-business?cid=CS-BENZ-FT-analyst_blog|company_news_corporate_actions-2344956">To read this article on Zacks.com click here.</a>

Mid Cap

Small Cap

FTDR

SWIM

Arcosa Acquires Stavola for $1.2B, Divests Steel Components Business

Watsco, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wso#NYSE">WSO</a>) is benefiting from consistent investments in technological advancements and strategic buyouts. Also, the solid performance of heating, ventilation and air conditioning (HVAC) equipment and commercial refrigeration products segments added to the uptrend. It is steadily advancing toward its goal of expanding customer-focused technologies to a growing number of contractors.
Apart from Watsco&#39;s technology investments that are expected to drive future growth, WSO anticipates that industry-driven catalysts will support ongoing growth and profitability. These factors, along with its scale, technology platforms, OEM relationships and entrepreneurial culture, offer competitive advantages that position the company favorably for the long term.
Shares of WSO have increased 24.9% in the past six months compared with the Zacks Building Products - Air Conditioner and Heating industry&#39;s growth of 20.4%. The Zacks Consensus Estimate for WSO&#39;s 2024 sales and earnings per share indicates a rise of 4.7% and 1.2%, respectively, from the year-ago period&#39;s levels. However, seasonal sales trends, along with increased costs and expenses, are a concern.
<img alt="Zacks Investment Research" src="https://staticx-tuner.zacks.com/images/articles/charts/1a/75432.jpg?v=1544056950" />
Image Source: Zacks Investment Research
Let us discuss the factors that highlight why investors should retain the stock now.
<h3>Factors Driving Watsco&#39;s Growth</h3>
Technology Investment to Fuel Growth: Watsco is consistently investing in industry-leading technologies to remodel customer experience. It is using various new technologies to transform the homeowner experience, which will help the company expand its customer base. Currently, it has the industry&#39;s largest database of digitized product information, with more than 1.5 million SKUs being used by more than 375,000 technical contractors and technicians annually via the Product Information Management database. Also, its HVAC Pro+ Mobile apps provide customers with real-time access to critical information that improves their speed and productivity. The authenticated user community rose 12% over the 12 months ending Jun 30, 2024, reaching around 60,000 users.
During second-quarter 2024, Watsco&#39;s e-commerce sales, driven by various technology platforms, contributed 36% to total sales and rose 13% year over year. E-commerce growth continued to surpass overall sales growth, including revenues from recently-acquired businesses now using Watsco&#39;s technology. WSO is benefiting from the increasing adoption of its innovative technology platforms by a growing number of contractors. Ongoing updates to these platforms are well-positioned to support the launch of new low GWP A2L systems, aligning with federal regulatory changes that offer significant growth opportunities in the coming years.
Additionally, energy efficiency mandates that took effect last year are driving upgrades to higher efficiency systems. The trend toward electrification of fossil fuel heating also boosted heat pump sales, contributing to continued growth.
Expansion Through Acquisitions: Acquisitions have been Watsco&#39;s preferred mode of solidifying its product portfolio and leveraging new business opportunities to increase its customer base and profitability. The company completed 69 acquisitions, which are key drivers of growth and scale. The company&#39;s &lsquo;buy and build&#39; strategy focuses on investing in new locations, expanding product offerings and leveraging its technology platform.
As of June 2024, the company acquired three businesses with collective average sales of about $200 million annually. These new companies helped Watsco reach new markets along with offering investment interests for fostering innovation. In February 2024, the company completed the acquisition of Commercial Specialists, an HVAC &amp; Plumbing distributor, operating at two locations in Southern Ohio.
Strong Liquidity to Reward Shareholders: The company&#39;s robust liquidity positions it well to continue rewarding shareholders. Warsco ended second-quarter 2024 with cash and cash equivalents of $224.9 million, reflecting an increase from $210.1 million in 2023 end. The company has sufficient funds to meet the short-term obligation of $104.4 million.
Watsco has been paying cash dividends for 50 consecutive years. It has been consistently focusing on sharing its cash flows with shareholders along with maintaining a strong financial position. The company increased dividends consecutively over the last 12 years. On Apr 1, 2024, the company raised its quarterly dividend by 10% to $2.70 per share (or $10.80 per share annually).
<h3>Concerns</h3>
Higher Costs: Watsco is affected by a persisting fixed cost inflation headwind. An increase in variable operating expenses such as freight and delivery costs, temporary labor and fixed costs (like rent) are potential headwinds. In the second quarter, gross margin contracted 100 basis points (bps) year over year to 27.1% due to the impact of pricing and sales mix for HVAC equipment.
Seasonality and Weather Woes: Sales of residential central air conditioners, heating equipment, and parts and supplies have historically been seasonal. Watsco&#39;s profitability will be impacted favorably or unfavorably, based on the severity or mildness of weather patterns during the summer or winter selling seasons. The company&#39;s first and fourth quarters of each calendar are severely affected by seasonality due to the nature and timing of HVAC systems replacement.
<h3>Key Picks</h3>
Here are some better-ranked stocks from the Construction sector.
EMCOR Group, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/eme#NYSE">EME</a>) presently flaunts a Zacks Rank #1 (Strong Buy). It has a trailing four-quarter earnings surprise of 36.5%, on average.
The consensus estimate for EME&#39;s 2024 earnings per share indicates an improvement of 34.9% from the prior-year levels.
Armstrong World Industries, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/awi#NYSE">AWI</a>) currently carries a Zacks Rank #2 (Buy). It has a trailing four-quarter earnings surprise of 15.4%, on average.
The consensus estimate for AWI&#39;s 2024 sales and EPS indicates growth of 10.1% and 14.1%, respectively, from the prior-year reported levels.
Advanced Drainage Systems, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wms#NYSE">WMS</a>) currently sports a Zacks Rank #2. WMS delivered a trailing four-quarter earnings surprise of 23.2%, on average.
The Zacks Consensus Estimate for WMS&#39; fiscal 2025 sales and EPS indicates growth of 4.7% and 12.4%, respectively, from the prior-year reported levels.
<a href="https://www.zacks.com/stock/news/2327132/here-s-why-investor-should-retain-watsco-wso-stock-for-now?cid=CS-BENZ-FT-analyst_blog|rank_focused-2327132">To read this article on Zacks.com click here.</a>

Large Cap

Penny Stocks

Here's Why Investor Should Retain Watsco Stock for Now

Increased government infrastructure spending is bolstering companies in the Zacks Building Products - Miscellaneous industry. Although potential challenges like macroeconomic uncertainties, high rates, low consumer confidence, new product investments, and rising raw material costs could squeeze margins, firms such as Advanced Drainage Systems, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wms#NYSE">WMS</a>), Armstrong World Industries, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/awi#NYSE">AWI</a>), Frontdoor, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/ftdr#NASDAQ">FTDR</a>), Construction Partners, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/road#NASDAQ">ROAD</a>) and Latham Group, Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/swim#NASDAQ">SWIM</a>) stand to gain from operational excellence, geographic and product diversification strategies, strategic acquisitions, and higher infrastructure investments.
Industry Description
The Zacks Building Products - Miscellaneous industry primarily comprises manufacturers, designers and distributors of home improvement and building products like ceiling systems, doors, windows, flooring and metal products. Some industry players provide solutions to rehabilitate the aging infrastructure, primarily pipelines in the wastewater, water, energy, mining and refining industries. The companies also manufacture expansion joints and structural bearings, ventilation products, ground-mounted solar racking and commercial greenhouses, as well as mail storage (solutions including mailboxes along with package delivery products). Companies in this industrial cohort also rent out equipment to a diverse customer base, including construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities.
3 Trends Shaping the Future of the Building Products Industry
U.S. Administration&#39;s Infrastructural Spending: The industry players are expected to benefit from strong global trends in infrastructure modernization, energy transition, national security and a potential super-cycle in global supply-chain investments. The U.S. administration&#39;s endeavor to rebuild the nation&#39;s deteriorating roads and bridges and fund new climate-resilient and broadband initiatives is expected to aid the companies. Meanwhile, as the industry players&#39; business prospects are highly correlated with U.S. housing market conditions, improving residential construction markets are expected to drive growth. Builders are now cautiously optimistic for 2024 as the lack of existing inventory is shifting demand to the new home market, thereby driving the demand for companies&#39; products in the industry.
Operational Excellence, Product Innovation &amp; Acquisitions: The industry participants have been undertaking strong cost-saving initiatives like business consolidation, system implementations, plant/branch closures, improvement in the global supply chain and headcount reductions to boost profitability. Industry participants have also been strategically investing in new products, sales and support services, digitally enabled solutions and advanced manufacturing capabilities to boost revenues. The companies are also following a systematic acquisition strategy to supplement organic growth and expand access to additional markets and products.
Rising Costs: Inflationary headwinds with respect to transportation costs, material costs and energy costs have been a pressing concern. Also, rising labor costs are compressing margins. These are dampening the companies&#39; operating performance. Although the industry participants have been working to recover higher costs through various price increases, they expect this ongoing volatility in material and transportation costs to be a concern. Apart from higher raw material costs, the companies bear expenses related to product launches. If companies are unable to offset these costs through price increases or supply-chain initiatives, their profits may be affected.
Zacks Industry Rank Indicates Bright Prospects
The Zacks Building Products &ndash; Miscellaneous industry is a 27-stock group within the broader Zacks Construction sector. The industry currently carries a Zacks Industry Rank #57, which places it in the top 23% of more than 250 Zacks industries.
The group&#39;s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates positive near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry&#39;s positioning in the top 50% of the Zacks-ranked industries is a result of a higher earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are gradually gaining confidence in this group&#39;s earnings growth potential. Since May 2024, the industry&#39;s earnings estimates for 2024 have been revised upward to $4.80 from $4.77 per share.
Before we present a few stocks that you may want to consider for your portfolio, let&#39;s take a look at the industry&#39;s recent stock-market performance and valuation picture.
Industry Outperforms S&amp;P 500, Matches Sector
The Zacks Building Products &ndash; Miscellaneous industry has outperformed the Zacks S&amp;P 500 Composite but is in line with the broader Zacks Construction sector over the past year.
Over this period, the industry has rallied 32%, the same as the broader sector&#39;s rise. Meanwhile, the Zacks S&amp;P 500 Composite has jumped 26.2% over the same period.
<h3>One-Year Price Performance</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/share price 22_8_2024.jpg" style="height:310px; width:620px" />
Industry&#39;s Current Valuation
On the basis of the forward 12-month price to earnings, which is a commonly used multiple for valuing building products&#39; stocks, the industry is trading at 16.7X versus the S&amp;P 500&#39;s 21.6X and the sector&#39;s 17.5X.
Over the past five years, the industry has traded as high as 20.1X, as low as 11.1X and at a median of 15.9X, as the chart below shows.
<h3>Industry&#39;s P/E Ratio (Forward 12-Month) Versus S&amp;P 500</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/valuation 22_8_2024.jpg" style="height:203px; width:620px" />
5 Building Product Stocks to Buy Now
We have selected five stocks from the Zacks universe of building products that currently carry a Zacks Rank #1 (Strong Buy) or 2 (Buy).
Frontdoor: Based in Memphis, TN, this company provides home warranties in the United States. The company is benefiting from its focus on new and innovative ways to boost demand for services, and the relaunch of American Home Shield brand is a significant component of this strategy. Looking ahead, the company is committed to establishing a solid foundation by investing in its brand and technology infrastructure and enhancing productivity throughout the organization.
FTDR, a Zacks Rank #1 stock, has gained 49% over the past year. FTDR has seen an upward estimate revision of 8.3% for 2024 earnings over the past 30 days to $2.73 per share. The estimated figure indicates 18.7% year-over-year growth for 2024. The company&#39;s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average being 279%. It currently holds a VGM Score of A.
<h3>Price and Consensus: FTDR</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/ftdr 22_8_2024.jpg" style="height:350px; width:620px" />
Construction Partners: Headquartered in Dothan, AL, this civil infrastructure company engages in the construction and maintenance of roadways across Alabama, Florida, Georgia, North Carolina and South Carolina. The company has been benefiting from solid demand for infrastructure services across its geographic footprint of more than 70 local markets in the Southeast in both the private and public sectors, supported by increased funding for public projects at federal, state, and local levels, defying labor and inflation challenges. Its recent acquisitions will help the company expand operations into fast-growing markets while maintaining its leverage ratio. Construction Partners&#39; organic and inorganic growth opportunities in the attractive Southeastern U.S. Road construction/repair market are expected to help the company generate higher revenues.
ROAD, a Zacks Rank #1 stock, has gained 81.6% over the past year. This company surpassed earnings estimates in three of the trailing four quarters and missed on one occasion, with the average surprise being 10.6%. ROAD has seen an upward estimate revision of 2.9% for fiscal 2024 earnings over the past 30 days to $1.44 per share. Again, it carries an impressive VGM Score of B.
<h3>Price and Consensus: ROAD</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/road 22_8_2024.jpg" style="height:344px; width:620px" />
Latham Group: Based in Latham, NY, Latham Group, Inc. stands as the leading designer, manufacturer, and marketer of in-ground residential swimming pools and pool accessories across North America, Australia, and New Zealand. Despite difficult industry conditions, the company has been gaining from improved cost structures, production efficiencies, lean manufacturing, value engineering programs, and lower raw material costs. It remains focused on fiberglass pools, which offer cost, installation, and eco-friendly advantages over concrete pools. The company has been expanding its product line and national dealer network, driving awareness and adoption. Meanwhile, the latest acquisition of Coverstar Central, Latham&#39;s long-time partner in automatic safety covers, is expected to enhance margins, accelerate sales growth, and strengthen relationships with pool builders, particularly for promoting fiberglass pools.
SWIM, a Zacks Rank #1 stock, has gained 46.6% over the past year. This company surpassed earnings estimates in the last reported quarter by 275%. SWIM has seen an upward estimate revision of 2024 earnings to 13 cents from break-even over the past 30 days. Again, it carries an impressive VGM Score of A.
<h3>Price and Consensus: SWIM</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/swim 22_8_2024.jpg" style="height:351px; width:620px" />
Advanced Drainage Systems: Headquartered in Hilliard, OH, this company provides innovative water management solutions in stormwater and on-site septic wastewater industries. The company has been experiencing positive outcomes from its Infiltrator business and the Allied products portfolio. Despite facing challenges such as higher interest rates, credit constraints, and economic unpredictability, the company anticipates growth fueled by increased demand in infrastructure, residential, and agriculture sectors. Moreover, proficient management of pricing and costs, coupled with the benefits derived from previous investments in new equipment, automation, and tooling, have significantly improved operational efficiency across the board. The material conversion strategy, complete water management solutions, and focus on key sales programs have been driving growth.
WMS, a Zacks Rank #2 stock, has gained 25.4% over the past year. WMS has seen an upward estimate revision of 0.1% for fiscal 2025 earnings over the past 60 days to $7.18 per share. The company&#39;s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 23.2%. It currently holds a VGM Score of B.
<h3>Price and Consensus: WMS</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/wms 22_8_2024.jpg" style="height:349px; width:620px" />
Armstrong World Industries: Based in Lancaster, PA, Armstrong World is a leading global manufacturer of ceiling systems primarily for commercial, institutional, and residential building construction and renovation. The company has been thriving by focusing on innovative products and pursuing strategic acquisitions to diversify its portfolio. Its recent acquisition of 3form, LLC is set to bolster the Architectural Specialties segment and strengthen connections with architects and designers. Additionally, Armstrong World has been investing in digitalization and technological advancements. Since 2022, its digital initiative, Canopy, has shown consistent quarterly growth, generating new demand for its products. Furthermore, the company&#39;s recent investments in developing new products in metal, wood, and Tectum materials are contributing positively to its performance.
AWI, a Zacks Rank #2 stock, has gained 67.4% over the past year. AWI has seen an upward estimate revision of 3.1% for 2024 earnings over the past 30 days to $6.07 per share. The company&#39;s earnings for 2024 are expected to increase 14.1%. The company&#39;s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.4%.
<h3>Price and Consensus: AWI</h3>
<img alt="" src="https://staticx-tuner.zacks.com/images/zadmin_tuner_image/awi 22_8_2024.jpg" style="height:349px; width:620px" />
<a href="https://www.zacks.com/commentary/2325780/5-building-products-stocks-riding-the-industry-wave?cid=CS-BENZ-FT-industry_outlook-2325780">To read this article on Zacks.com click here.</a>

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5 Building Products Stocks Riding the Industry Wave

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Armstrong World Industries Schedules Fourth-Quarter and Full-Year 2024 Earnings Release and Conference Call

Armstrong World Industries Announces Quarterly Dividend

Armstrong World Industries Reports Record-Setting Fourth-Quarter and Full-Year 2024 Results

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