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Q1 Earnings Outperformers: Fortune Brands (NYSE:FBIN) And The Rest Of The Home Construction Materials Stocks


Max Juang /
2024/07/08 3:43 am EDT

Wrapping up Q1 earnings, we look at the numbers and key takeaways for the home construction materials stocks, including Fortune Brands (NYSE:FBIN) and its peers.

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 9 home construction materials stocks we track reported a decent Q1; on average, revenues beat analyst consensus estimates by 0.7%. while next quarter's revenue guidance was 2.3% above consensus. Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and home construction materials stocks have had a rough stretch, with share prices down 15.6% on average since the previous earnings results.

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 $1.11 billion, up 6.7% year on year, topping analysts' expectations by 2.7%. It was an exceptional quarter for the company, with an impressive beat of analysts' organic revenue estimates and a decent beat of analysts' earnings estimates.

“Our first quarter sales and margin results came in above our expectations as our teams executed our strategy of growing the core and accelerating in connected products,” said Fortune Brands Chief Executive Officer Nicholas Fink.

Fortune Brands Total Revenue

The stock is down 14.3% since the results and currently trades at $62.64.

Is now the time to buy Fortune Brands? Access our full analysis of the earnings results here, it's free.

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 revenue and EPS exceeding Wall Street's expectations.

Griffon Total Revenue

Griffon scored the biggest analyst estimates beat among its peers. The stock is down 6.6% since the results and currently trades at $63.31.

Is now the time to buy Griffon? Access our full analysis of the earnings results here, it's free.

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 had the weakest performance against analyst estimates in the group. The stock is up 0.3% since the results and currently trades at $133.02.

Read our full analysis of Masonite's results here.

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%. 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 pulled off the fastest revenue growth among its peers. The stock is down 24.1% since the results and currently trades at $70.94.

Read our full, actionable report on Trex 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 $212.6 million, up 1.2% year on year, surpassing analysts' expectations by 1.7%. It was a strong quarter for the company, with an impressive beat of analysts' organic revenue estimates.

The stock is down 10.8% since the results and currently trades at $12.07.

Read our full, actionable report on Hayward here, it's free.

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