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Builders Firstsource (BLDR)
:BLDR
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Builders Firstsource
(NYSE:BLDR)65Neutral
Positive Factors
Digital Sales Growth
BLDR's ability to generate $200 million incremental sales in 2025 through digital acts as a partial offset to challenges.
Strategic Acquisition
The Alpine Lumber acquisition is seen as a terrific strategic fit that should meaningfully consolidate Builders Firstsource's share in the Colorado market and enhance its value-added product capabilities.
Negative Factors
Interest Rates Impact
Higher rates are weighing on BLDR, posing risk to the outlook for single-family and repair & remodel markets.
Builders Firstsource (BLDR) vs. S&P 500 (SPY)
Market Cap
$14.82B
Dividend YieldN/A
Average Volume (3M)1.74M
Price to Earnings (P/E)14.4
Beta (1Y)1.95
Revenue Growth-4.08%
EPS Growth-24.71%
CountryUS
Employees29,000
SectorIndustrials
Sector Strength66
IndustryConstruction
Share Statistics
EPS (TTM)9.04
Shares Outstanding113,621,376
10 Day Avg. Volume2,336,986
30 Day Avg. Volume1,739,366
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.93
Price to Cash Flow (P/CF)10.30
P/FCF Ratio10.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$173.00Price Target Upside32.68% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering14
Builders Firstsource Business Overview & Revenue Model
Company DescriptionBuilers FirstSource, Inc. engages in the supply and manufacture of building materials, manufactured components, and construction services to professional homebuilders, sub-contractors, remodelers, and consumers. It operates through the following segments: Northeast, Southeast, South, and West. Its products includes factory-built roof and floor trusses, wall panels and stairs, vinyl windows, custom millwork and trim, as well as engineered wood. The company was founded by Kevin P. O'Meara, Donald F. McAleenan, and John D. Roach in March 1998 and is headquartered in Dallas, TX.
How the Company Makes MoneyBuilders FirstSource generates revenue primarily by supplying a wide array of building materials and manufactured products to the residential construction market. The company's key revenue streams include the sale of lumber and lumber sheet goods, manufactured products such as roof and floor trusses, wall panels, stairs, and engineered wood products, as well as windows, doors, and millwork. Additionally, Builders FirstSource offers value-added services like project management and installation services. The company capitalizes on strategic partnerships with suppliers and leverages economies of scale to maintain competitive pricing and secure a steady supply chain. These factors, combined with a strong distribution network, contribute significantly to its earnings.
Builders Firstsource Financial Statement Overview
Summary
Builders Firstsource demonstrates solid financial health with strong profitability and cash flow generation. Although revenue growth is slowing and stockholders' equity is declining, the company maintains stable margins and a balanced financial structure, showcasing effective cost management and strong cash flow.Income Statement
Builders Firstsource has shown strong profitability with a consistent gross profit margin and healthy net profit margin over recent years. However, there has been a notable decline in revenue growth in the latest year, which suggests a slowdown in sales momentum. The EBIT and EBITDA margins remain solid, indicating effective cost management despite revenue fluctuations.78
Positive
Balance Sheet
The company maintains a moderate debt-to-equity ratio, reflecting a balanced approach to leveraging debt. The equity ratio has been stable, indicating a solid capital structure. However, the decline in stockholders' equity needs attention as it may affect future financial flexibility.72
Positive
Cash Flow
Builders Firstsource enjoys strong operating cash flow relative to net income, showcasing efficient cash generation capabilities. The free cash flow growth has been robust, although recent fluctuations in free cash flow could signal potential volatility in cash reserves.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 16.40B | 17.10B | 22.73B | 19.89B | 8.56B | Gross Profit |
| 5.38B | 6.01B | 7.74B | 5.85B | 2.22B | EBIT |
| 1.60B | 2.18B | 3.77B | 2.39B | 543.85M | EBITDA |
| 1.60B | 2.73B | 4.27B | 2.93B | 660.42M | Net Income Common Stockholders |
| 1.08B | 1.54B | 2.75B | 1.73B | 313.54M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 153.62M | 66.16M | 80.44M | 42.60M | 423.81M | Total Assets |
| 10.58B | 10.50B | 10.60B | 10.71B | 4.17B | Total Debt |
| 632.18M | 3.71B | 3.49B | 3.40B | 1.91B | Net Debt |
| 478.56M | 3.65B | 3.41B | 3.36B | 1.48B | Total Liabilities |
| 6.29B | 5.77B | 5.63B | 5.91B | 3.02B | Stockholders Equity |
| 4.30B | 4.73B | 4.96B | 4.80B | 1.15B |
| Cash Flow | Free Cash Flow | |||
| 1.49B | 1.83B | 3.26B | 1.52B | 147.99M | Operating Cash Flow |
| 1.87B | 2.31B | 3.60B | 1.74B | 260.07M | Investing Cash Flow |
| -710.72M | -668.29M | -957.48M | -1.34B | -136.22M | Financing Cash Flow |
| -1.07B | -1.65B | -2.60B | -780.11M | 285.87M |
Builders Firstsource Technical Analysis
Negative
130.39
Price Trends
152.02
Negative
166.30
Negative
164.79
Negative
Market Momentum
-6.58
Positive
26.67
Positive
16.06
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BLDR, the sentiment is Negative. The current price of 130.39 is below the 20-day moving average (MA) of 147.39, below the 50-day MA of 152.02, and below the 200-day MA of 164.79, indicating a bearish trend. The MACD of -6.58 indicates Positive momentum. The RSI at 26.67 is Positive, neither overbought nor oversold. The STOCH value of 16.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BLDR.
Builders Firstsource Risk Analysis
Builders Firstsource disclosed 33 risk factors in its most recent earnings report. Builders Firstsource reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Builders Firstsource Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $7.11B | 19.80 | 23.86% | ― | 9.89% | ― | |
71 Outperform | $13.18B | 20.90 | 12.74% | 1.62% | 13.41% | -44.36% | |
68 Neutral | $8.96B | 14.57 | 28.18% | ― | 2.60% | 5.15% | |
65 Neutral | $14.82B | 14.42 | 23.88% | ― | -4.08% | -24.71% | |
62 Neutral | $8.11B | 13.34 | 1.17% | 3.02% | 4.16% | -15.14% | |
60 Neutral | $15.94B | 20.03 | -118.61% | 1.57% | -1.74% | -6.91% | |
44 Neutral | $466.67M | ― | -30.48% | ― | -15.09% | -358.01% |
* Industrials Sector Average
Performance Comparison
BLDR
Builders Firstsource
130.39
-67.91
-34.25%
BECN
Beacon Roofing Supply
111.51
26.32
30.90%
MAS
Masco
72.50
-2.91
-3.86%
OC
Owens Corning
144.03
-3.64
-2.46%
BLD
TopBuild
295.17
-106.66
-26.54%
JELD
JELD-WEN
5.46
-12.20
-69.08%
Builders Firstsource Earnings Call Summary
Earnings Call Date: Feb 20, 2025 | % Change Since: -9.95% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a company managing well through a challenging market environment, with strong EBITDA performance, significant investments in growth and digital sales, and successful M&A activity. However, these positives are tempered by declines in net sales, weakness in the multifamily segment, and external challenges such as severe weather and wildfires affecting sales.Highlights
Strong EBITDA and Gross Margin Performance
Achieved a mid-teens adjusted EBITDA margin and nearly 33% gross margin in 2024, demonstrating resilience and operational excellence.
Significant Investment in Growth
Invested over $75 million in value-added facilities in 2024, including opening two new truss manufacturing facilities and upgrading nineteen truss facilities.
Digital Sales Growth
Achieved $134 million in incremental digital sales in 2024, with expectations for an additional $200 million in 2025.
Successful M&A Activity
Completed thirteen acquisitions in 2024 with aggregate prior year sales of $420 million, expanding footprint and enhancing value-added offerings.
Commitment to Shareholder Returns
Executed opportunistic share repurchases of approximately $1.5 billion, removing roughly 7% of shares outstanding in 2024.
Lowlights
Decline in Net Sales
Net sales decreased by 8% to $3.8 billion in Q4 2024, primarily due to lower core organic sales and commodity deflation.
Multifamily Segment Weakness
29% decline in multifamily sales in 2024 amid muted activity levels, expected to remain a headwind in 2025.
Challenging Market Conditions
Single-family starts pulled back, and multifamily remains a headwind, with builders facing affordability challenges and regulatory issues.
Impact of Severe Weather and Wildfires
Extreme weather and California wildfires led to a loss of approximately $80 million in sales year-to-date in Q1 2025.
Company Guidance
During the Builders FirstSource Fourth Quarter 2024 and Full Year Earnings Conference Call, the company provided guidance for 2025, highlighting several key metrics and strategic initiatives. The company expects net sales to range between $16.5 billion and $17.5 billion, with an adjusted EBITDA between $1.9 billion and $2.3 billion and an adjusted EBITDA margin of 11.5% to 13%. The gross margin for 2025 is projected to be between 30% and 32%. Builders FirstSource plans to achieve $600 million to $1 billion in free cash flow, with a focus on maintaining operational flexibility and managing expenses. The company anticipates a flat single-family market and continued weakness in multifamily, which will present headwinds. Despite these challenges, Builders FirstSource is optimistic about generating $200 million in incremental sales from its digital platform, supporting value-added solutions, and leveraging its strong operational platform. Additionally, the company continues to pursue M&A opportunities, having completed acquisitions with aggregate prior-year sales of roughly $420 million in 2024, and expects to see growth from these acquisitions in the future.Builders Firstsource Corporate Events
Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
Builders FirstSource Strengthens Board with New Appointments
Neutral
Feb 20, 2025
In a recent development, Builders FirstSource announced the addition of Cheryl Ainoa and Maria Renz to its Board of Directors, effective March 1, 2025. Both bring substantial expertise in digital transformation and innovation from leading tech companies, which is expected to enhance the company’s strategic direction. Furthermore, the company reported its financial results for the fourth quarter and full year 2024, highlighting a decline in net sales, gross margin, and net income due to lower core organic sales and commodity deflation. Despite these challenges, Builders FirstSource remains committed to investing in value-added solutions and technology, positioning itself for resilience and future growth.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.