Mohawk (MHK) AI Stock Analysis

• Market Cap: $6.61B
• Dividend Yield: N/A
• Average Volume (3M): 772.80K
• Price to Earnings (P/E): 12.6
• Beta (1Y): 1.34
• Revenue Growth: -2.68%
• EPS Growth: N/A
• Country: US
• Employees: 41,900
• Sector: Consumer Cyclical
• Sector Strength: 60
• Industry: Furnishings, Fixtures & Appliances
• EPS (TTM): 8.13
• Shares Outstanding: 62,587,227
• 10 Day Avg. Volume: 805,196
• 30 Day Avg. Volume: 772,799
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.65
• Price to Cash Flow (P/CF): 4.40
• P/FCF Ratio: 7.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $141.43
• Price Target Upside: 38.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

Mohawk Industries demonstrates strong financial fundamentals with improving profitability and robust cash flow management. However, challenges such as declining sales, market pressures, and operational issues weigh on its performance. Technical indicators suggest bearish momentum, while valuation metrics are reasonable. The company’s strategic initiatives and restructuring efforts provide some optimism, but market conditions remain challenging.

Positive Factors

Market Share

Mohawk is gaining share, especially in North America where volume grew YoY in a down market led by laminate, residential carpet, and commercial carpet tile.

Stock Rating

Analyst's recommendation is upgrading the rating on MHK’s equity to Outperform with a $150 price target, indicating a 27% upside.

Valuation

Shares trade at 5.8x 2026 EV/EBITDA below its historical valuation and below its historical discount to building product peers, making valuation attractive.

Negative Factors

Cost Pressures

Natural gas, melamine crystals, and polyester inputs are expected to largely offset cost savings, highlighting ongoing input pressures.

Earnings Guidance

Mohawk provided 4Q EPS guidance of $1.77 - $1.87 well below consensus due to continued headwinds from lower production, inflation, and negative hurricane impact.

Operational Challenges

Management indicated that ERP issues were related to 'order to cash' problems, which might affect operational efficiency.

Mohawk Business Overview & Revenue Model

Company Description

Mohawk Industries, Inc. designs, manufactures, sources, distributes, and markets flooring products for remodeling and new constructions of residential and commercial spaces in the United States, Europe, Russia, and internationally. It operates through three segments: Global Ceramic, Flooring North America (Flooring NA), and Flooring Rest of the World (Flooring ROW). The Global Ceramic segment provides a range of ceramic tile, porcelain tile, and natural stone products; and sources, markets, and distributes other tile related products. This segment markets and distributes its products under the American Olean, Daltile, Eliane, EmilGroup, KAI, Kerama Marazzi, Marazzi, and Ragno brands. The Flooring NA segment offers floor covering product lines in a range of colors, textures, and patterns, including carpets, carpet tiles, rugs and mats, carpet pads, hardwood, laminate, medium-density fiberboards, luxury vinyl tiles (LVT), and sheet vinyl products. This segment markets and distributes its flooring products under the Aladdin Commercial, Durkan, IVC, Karastan, Mohawk, Mohawk Group, Mohawk Home, Pergo, Portico, and Quick-Step brands. The Flooring ROW segment provides wood flooring and vinyl flooring, as well as laminates, roofing elements, sheet vinyl, LVT, insulation boards, medium-density fiberboards, chipboards, and other woods products under the Feltex, Godfrey Hirst, Hycraft, IVC Commercial, IVC Home, Leoline, Moduleo, Pergo, Quick-Step, and Unilin and Xtratherm brands; and licenses its intellectual property to flooring manufacturers. Mohawk Industries, Inc. was incorporated in 1988 and is headquartered in Calhoun, Georgia.

How the Company Makes Money

Mohawk Industries generates revenue primarily through the sale of its extensive range of flooring products across its three key segments. The Global Ceramic segment is responsible for creating and distributing ceramic tile, porcelain tile, and natural stone flooring products. The Flooring North America segment focuses on selling carpet, laminate, resilient, hardwood, and other flooring products within the United States and Canada. The Flooring Rest of the World segment targets international markets outside North America, offering similar flooring solutions. Mohawk's revenue model is heavily reliant on the housing and construction industries, with its earnings influenced by factors such as new residential constructions, remodeling projects, and commercial building activities. The company also benefits from strategic acquisitions and partnerships that enhance its product offerings and market reach.

Mohawk Financial Statement Overview

Summary

Mohawk Industries shows signs of recovery with improving profitability and strong cash flow management. The balance sheet is robust with low leverage and a solid equity base, providing stability. However, the decline in revenue growth remains a challenge.

Income Statement

Mohawk's TTM (Trailing-Twelve-Months) gross profit margin is approximately 25.2%, indicating good cost management relative to revenue. The net profit margin improved to 4.77% from a negative margin in the previous year, showcasing a return to profitability. However, revenue has declined by 2.68% year-over-year, reflecting challenges in growing sales. The EBIT and EBITDA margins are 6.88% and 11.32% respectively, indicating moderate operating performance.

Balance Sheet

The company's debt-to-equity ratio improved to 0.13, reflecting a strong leverage position. Return on equity is 6.85%, which is a positive sign compared to prior negative returns. The equity ratio stands at 59.09%, indicating a solid equity base relative to total assets, enhancing financial stability.

Cash Flow

Free cash flow grew by 17.3% year-over-year, illustrating improved cash generation capabilities. The operating cash flow to net income ratio is 2.19, suggesting strong cash conversion efficiency. The free cash flow to net income ratio is 1.62, indicating effective cash management and reinvestment potential.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
10.84B	11.14B	11.74B	11.20B	9.55B
	Gross Profit
2.69B	2.71B	2.94B	3.27B	2.43B
	EBIT
694.70M	-287.81M	931.60M	755.53M	29.25M
	EBITDA
694.70M	531.94M	883.69M	2.00B	1.43B
	Net Income Common Stockholders
517.70M	-439.52M	25.25M	1.03B	515.60M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
0.00	642.55M	667.62M	591.89M	1.34B
	Total Assets
12.78B	13.56B	14.12B	14.22B	14.33B
	Total Debt
555.90M	3.15B	3.22B	2.73B	3.07B
	Net Debt
555.90M	2.51B	2.71B	2.46B	2.30B
	Total Liabilities
5.22B	5.93B	6.10B	5.80B	5.79B
	Stockholders Equity
64.20M	7.62B	8.02B	8.43B	8.54B
Cash Flow		Free Cash Flow
679.50M	716.30M	88.41M	633.00M	1.34B
	Operating Cash Flow
1.13B	1.33B	669.15M	1.31B	1.77B
	Investing Cash Flow
-454.40M	-970.34M	-625.34M	-556.75M	-954.80M
	Financing Cash Flow
-629.50M	-210.68M	194.35M	-1.23B	-188.19M

Mohawk Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 102.16
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MHK, the sentiment is Negative. The current price of 102.16 is below the 20-day moving average (MA) of 113.15, below the 50-day MA of 116.85, and below the 200-day MA of 133.15, indicating a bearish trend. The MACD of -0.79 indicates Negative momentum. The RSI at 47.77 is Neutral, neither overbought nor oversold. The STOCH value of 47.18 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MHK.

Mohawk Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TOL	69 Neutral	$10.03B	6.94	20.38%	0.91%	5.86%	12.20%
MHK	66 Neutral	$6.61B	12.56	6.82%	―	-2.68%	―
LEG	60 Neutral	$970.31M	―	-50.58%	2.78%	-7.27%	-272.76%
MAS	60 Neutral	$13.32B	16.76	-118.61%	1.88%	-1.74%	-6.91%
Sector *	59 Neutral	$11.18B	10.04	-1.58%	3.96%	1.31%	-16.97%
WHR	47 Neutral	$4.74B	13.03	-12.77%	8.17%	-14.64%	-167.22%
JELD	44 Neutral	$492.56M	―	-25.51%	―	-15.09%	-358.01%

Mohawk Corporate Events

Mohawk Appoints David Repp as Chief Accounting Officer

On March 31, 2025, Mohawk Industries announced the appointment of David L. Repp as Senior Vice President – Chief Accounting Officer and Corporate Controller. Mr. Repp, who has been with the company since 2005, has held various roles, including Vice President positions in finance and segment control. He succeeds James F. Brunk, who served as interim Chief Accounting Officer since March 14, 2025, and will continue as Chief Financial Officer. This leadership change is expected to strengthen Mohawk’s financial management and operational continuity.

Mohawk CFO William Harkins Announces Resignation

On February 25, 2025, William W. Harkins announced his resignation from Mohawk Industries, Inc., effective March 14, 2025, to pursue another opportunity. In response, James F. Brunk will temporarily assume the roles of Chief Accounting Officer and Corporate Controller in addition to his duties as Chief Financial Officer while the company searches for a permanent replacement.

Mohawk Navigates System Disruptions in Flooring Segment

After the end of 2024, Mohawk’s Flooring North America segment faced issues with a new order management system, leading to shipping and invoicing disruptions. However, most system processes have been corrected, improving shipping rates and normalizing backlog levels. Despite these challenges, manufacturing and distribution operations remain stable. Mohawk plans to release its fourth quarter and full-year results on February 6, 2025, and will address the system conversion impact during the investor call.