Let's take a look at the relative performance of Griffon (NYSE:GFF) and its peers as we decipher the home building materials third-quarter earnings season, now complete.
Traditionally, home building materials companies have built economic moats with expertise in specialty areas, brand recognition and strong relationships with contractors. More recently, advances in improving workforce availability and workplace productivity have led to innovations that are driving increased demand. However, these companies are dependent on residential construction volumes, which tend to be cyclical and can be heavily influenced by economic factors such as interest rates. In addition, raw material costs can be influenced by a variety of global factors and can greatly affect the profitability of home building materials companies.
The 12 homebuilding materials stocks we tracked posted mixed results in the third quarter. Overall, sales missed analysts' consensus estimates by 0.9%.
Amid this news, company stock prices experienced a difficult phase. On average, they are down 12.2% since the last earnings results.
Griffon (NYSE:GFF)
Originally in the defense industry, Griffon (NYSE:GFF) is now a diversified company specializing in home improvement, professional equipment and building products.
Griffon reported revenue of $659.7 million, up 2.9% year over year. This print exceeded analyst expectations by 2.9%. Overall, it was a very strong quarter for the company, significantly exceeding analysts' EBITDA estimates.
“We are very pleased with Griffon's fourth quarter and fiscal year results. “The continued strong performance of the Home and Building Products (“HBP”) segment and the improved profitability of the Consumer and Professional Products (“CPP”) segment position us for continued growth in the coming years,” said Ronald J. Kramer, Chairman and Chief Executive Officer .
Interestingly, the stock is up 5.6% since reporting and is currently trading at $71.97.
Is now the time to buy Griffon? You can access our full earnings results analysis for free here.
Best Q3: Trex (NYSE:TREX)
To meet the demand for aesthetically pleasing and unique outdoor living spaces, Trex Company (NYSE:TREX) manufactures decking, railings and patio furniture from wood alternatives.
Trex reported revenue of $233.7 million, down 23.1% from a year ago and beating analysts' expectations by 3.7%. The company had an exceptional quarter, significantly exceeding analysts' adjusted operating income estimates.
Trex delivered the largest analyst estimates that beat its peers. The market appears to be pleased with the results as the stock is up 4.5% since reporting. Currently the transaction price is $69.46.
Is now the time to buy Trex? You can access our full earnings results analysis for free here.
Weakest Q3: JELD-WEN (NYSE:JELD)
Founded in the 1960s as a general wood processing company, JELD-WEN (NYSE:JELD) manufactures doors, windows and other related building products.
JELD-WEN reported revenue of $934.7 million, down 13.2% from a year ago and falling 5.6% short of analysts' expectations. It was a disappointing quarter as full-year revenue guidance fell short of analysts' expectations.
JELD-WEN delivered the weakest full-year guidance update in the group. As expected, the stock has fallen 42.9% since the results and is currently trading at $8.08.
Read our full analysis of JELD-WEN's results here.
Masco (NYSE:MAS)
Masco (NYSE:MAS), headquartered just outside Detroit, MI, designs and manufactures residential products such as glass shower doors, decorative lighting, bathtubs and faucets.
Masco reported revenue of $1.98 billion, flat from a year ago. This value fell 0.9% short of analysts' expectations. Overall, it was a mixed quarter as the company also posted organic revenue that was in line with analyst estimates, but slightly missed analysts' EPS estimates.
The stock has fallen 12.3% since reporting and is currently trading at $71.62.
Read our full, actionable report on Masco for free here.
Fortune Brands (NYSE:FBIN)
Fortune Brands (NYSE:FBIN) serves a broad consumer and commercial customer base and manufactures plumbing, security and outdoor products.
Fortune Brands reported revenue of $1.16 billion, down 8.4% year over year. This figure was 6.9% below analysts' expectations. Overall, it was a weaker quarter as analysts' organic sales estimates and EPS estimates were also significantly missed.
Fortune Brands was the weakest performer compared to analyst estimates. The stock has fallen 19.8% since reporting and is currently trading at $67.59.
Read our full, actionable report on Fortune Brands for free here.
Market update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs and is moving closer to the 2% target. This disinflation occurred without serious impact on economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, boosted by recent interest rate cuts (0.5% in September and 0.25% in both November and December), and there was a notable rise following Donald Trump's victory in the November presidential election, which drove the indices to historic highs. Still, the outlook for 2025 remains clouded by the pace and magnitude of future interest rate cuts, as well as possible changes in trade policy and corporate taxes once the Trump administration comes to power. The path ahead is marked by uncertainty.
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