Looking back on building materials stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including UFP Industries (NASDAQ:UFPI) and its peers.
Traditionally, building materials companies have built competitive advantages with economies of scale, brand recognition, and strong relationships with builders and contractors. More recently, advances to address labor availability and job site productivity have spurred innovation. Additionally, companies in the space that can produce more energy-efficient materials have opportunities to take share. However, these companies are at the whim of 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 building materials companies.
The 9 building materials stocks we track reported a satisfactory Q1. As a group, revenues beat analysts’ consensus estimates by 0.6% while next quarter’s revenue guidance was in line.
Luckily, building materials stocks have performed well with share prices up 14.1% on average since the latest earnings results.
Weakest Q1: UFP Industries (NASDAQ:UFPI)
Beginning as a lumber supplier in the 1950s, UFP Industries (NASDAQ:UFPI) is a holding company making building materials for the construction, retail, and industrial sectors.
UFP Industries reported revenues of $1.60 billion, down 2.7% year on year. This print fell short of analysts’ expectations by 1.9%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ adjusted operating income estimates and a significant miss of analysts’ EBITDA estimates.
“While our first quarter proved more challenging than anticipated and visibility remains limited, we are more encouraged by recent business trends,” said Will Schwartz, UFP Industries CEO.
UFP Industries delivered the slowest revenue growth of the whole group. Interestingly, the stock is up 1.4% since reporting and currently trades at $108.
Read our full report on UFP Industries here, it’s free.
Best Q1: Tecnoglass (NYSE:TGLS)
The first-ever Colombian company to trade on the NASDAQ, Tecnoglass (NYSE:TGLS) is a manufacturer of architectural glass, windows, and aluminum products.
Tecnoglass reported revenues of $222.3 million, up 15.4% year on year, outperforming analysts’ expectations by 3.3%. The business had an exceptional quarter with a solid beat of analysts’ adjusted operating income estimates.
The market seems happy with the results as the stock is up 8.2% since reporting. It currently trades at $76.51.
Is now the time to buy Tecnoglass? Access our full analysis of the earnings results here, it’s free.
Valmont (NYSE:VMI)
Credited with an invention in the 1950s that improved crop yields, Valmont (NYSE:VMI) provides engineered products and infrastructure services for the agricultural industry.
Valmont reported revenues of $969.3 million, flat year on year, falling short of analysts’ expectations by 0.6%. It was a slower quarter as it posted a miss of analysts’ EBITDA estimates and a slight miss of analysts’ organic revenue estimates.
Interestingly, the stock is up 26.6% since the results and currently trades at $341.26.
Read our full analysis of Valmont’s results here.
Armstrong World (NYSE:AWI)
Started as a two-man shop dating back to the 1860s, Armstrong (NYSE:AWI) provides ceiling and wall products to commercial and residential spaces.
Armstrong World reported revenues of $382.7 million, up 17.3% year on year. This result topped analysts’ expectations by 3.4%. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ adjusted operating income estimates.
Armstrong World scored the biggest analyst estimates beat among its peers. The stock is up 20.3% since reporting and currently trades at $166.84.
Read our full, actionable report on Armstrong World here, it’s free.
Resideo (NYSE:REZI)
Resideo Technologies, Inc. (NYSE: REZI) is a manufacturer and distributor of technology-driven products and solutions for home comfort, energy management, water management, and safety and security.
Resideo reported revenues of $1.77 billion, up 19.1% year on year. This number surpassed analysts’ expectations by 3%. It was a very strong quarter as it also put up a solid beat of analysts’ EPS estimates and full-year EBITDA guidance exceeding analysts’ expectations.
Resideo pulled off the fastest revenue growth and highest full-year guidance raise among its peers. The stock is up 36.3% since reporting and currently trades at $23.79.
Read our full, actionable report on Resideo here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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