Griffon’s fourth quarter results were met with a positive market response, bolstered by revenue and profit figures surpassing Wall Street expectations. Management attributed the quarter’s performance to strong price and mix in both residential and commercial building products, as well as improved profitability in its Consumer and Professional Products segment despite ongoing softness in U.S. demand. CEO Ronald Kramer highlighted that free cash flow was notably solid, supported by gains in Australia and Canada for consumer products. The quarter was further characterized by operational discipline, with stable margins in key business lines and a continued focus on leveraging the premium segment of the repair and remodel market.
Is now the time to buy GFF? Find out in our full research report (it’s free for active Edge members).
Griffon (GFF) Q4 CY2025 Highlights:
- Revenue: $649.1 million vs analyst estimates of $619.4 million (2.6% year-on-year growth, 4.8% beat)
- Adjusted EPS: $1.45 vs analyst estimates of $1.33 (8.9% beat)
- Adjusted EBITDA: $129.6 million vs analyst estimates of $123.5 million (20% margin, 4.9% beat)
- The company dropped its revenue guidance for the full year to $1.8 billion at the midpoint from $2.5 billion, a 28% decrease
- EBITDA guidance for the full year is $520 million at the midpoint, below analyst estimates of $534 million
- Operating Margin: 17.5%, in line with the same quarter last year
- Market Capitalization: $4.38 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Griffon’s Q4 Earnings Call
- Timothy Wojs (Baird) asked about the timing and rationale behind the joint venture. CEO Ronald Kramer explained it was intended to unlock value and better spotlight the differentiated performance of Griffon’s business segments.
- Lee Jagoda (CJS Securities) questioned the expected margin profile after combining Hunter Fan with Home and Building Products. CFO Brian Harris responded that margins should remain near 30%, with Hunter contributing to segment strength.
- Collin Verron (Deutsche Bank) asked about valuation multiples implied by the joint venture and the timeline for divestitures. Harris provided details on the multiples and stated the joint venture should close by the end of June, with updates on other actions forthcoming.
- Trey Grooms (Stephens Incorporated) inquired about demand trends in the Home and Building Products segment. Kramer and Harris emphasized optimism in a housing market recovery and ongoing benefits from product mix and pricing.
- Sam Darkatsh (Raymond James) pressed on why Hunter Fan was not included in the joint venture. Harris explained the strategic alignment of Hunter with Home and Building Products and the expected upside from this combination.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be tracking (1) the progress and finalization of the joint venture and subsequent reporting of discontinued operations, (2) execution on the divestiture or strategic alternatives for the AMES Australia and U.K. businesses, and (3) the integration and performance of Hunter Fan within the core building products segment. We will also monitor shifts in residential and commercial demand as well as management’s ability to sustain margins amid ongoing cost pressures.
Griffon currently trades at $91.50, up from $84.73 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free).
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