Q3 Earnings Roundup: Hayward (NYSE:HAYW) And The Rest Of The Home Construction Materials Segment
Looking back on home construction materials stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Hayward (NYSE:HAYW) and its peers.
Traditionally, home construction materials companies have built economic moats with expertise in specialized areas, brand recognition, and strong relationships with contractors. More recently, advances to address labor availability and job site productivity have spurred innovation that is driving incremental demand. However, these companies are at the whim of residential 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 home construction materials companies.
The 12 home construction materials stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 0.9%.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 13.5% since the latest earnings results.
Hayward (NYSE:HAYW)
Credited with introducing the first variable-speed pool pump, Hayward (NYSE:HAYW) makes residential and commercial pool equipment and accessories.
Hayward reported revenues of $227.6 million, up 3.3% year on year. This print exceeded analysts’ expectations by 2.1%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ EPS estimates.
“I am pleased to report third quarter results consistent with expectations”Post this CEO COMMENTS
Hayward Total Revenue
Hayward pulled off the highest full-year guidance raise of the whole group. The results were likely priced in, however, and the stock is flat since reporting. It currently trades at $14.76.
Addressing the demand for aesthetically-pleasing and unique outdoor living spaces, Trex Company (NYSE:TREX) makes wood-alternative decking, railing, and patio furniture.
Trex reported revenues of $233.7 million, down 23.1% year on year, outperforming analysts’ expectations by 3.7%. The business had an exceptional quarter with a solid beat of analysts’ EBITDA estimates.
Trex Total Revenue
Trex delivered the biggest analyst estimates beat among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $67.
Founded in the 1960s as a general wood-making company, JELD-WEN (NYSE:JELD) manufactures doors, windows, and other related building products.
JELD-WEN reported revenues of $934.7 million, down 13.2% year on year, falling short of analysts’ expectations by 5.6%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.
JELD-WEN delivered the weakest full-year guidance update in the group. As expected, the stock is down 44% since the results and currently trades at $7.92.
Headquartered just outside of Detroit, MI, Masco (NYSE:MAS) designs and manufactures home-building products such as glass shower doors, decorative lighting, bathtubs, and faucets.
Masco reported revenues of $1.98 billion, flat year on year. This number lagged analysts' expectations by 0.9%. Zooming out, it was a mixed quarter as it also recorded organic revenue in line with analysts’ estimates but a slight miss of analysts’ EPS estimates.
The stock is down 12.2% since reporting and currently trades at $71.70.
Starting in the seamless tube industry, Quanex (NYSE:NX) manufactures building products like window, door, kitchen, and bath cabinet components.
Quanex reported revenues of $492.2 million, up 66.6% year on year. This result met analysts’ expectations. Overall, it was a very strong quarter as it also produced a solid beat of analysts’ EBITDA estimates.
Quanex scored the fastest revenue growth among its peers. The stock is down 20.2% since reporting and currently trades at $23.10.
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 has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), 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 the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.
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