Zacks
0
All posts from Zacks
Zacks in Our Research. Your Success.,

Construction Stocks to Post Earnings on May 9; AFI, PGEM, CBPX

The Q1 performance across the broader construction sector has given investors ample reasons to rejoice. Leading homebuilders, Lennar Corporation LEN and KB Home KBH – the first ones to report quarterly earnings in March – posted positive sales and earnings surprises. Other industry bigwigs like PulteGroup, Inc. PHM and D.R. Horton, Inc. DHI also beat the Zacks Consensus Estimate for both earnings and sales on the back of higher home sales.

Almost all homebuilders agree that the spring selling season was off to a good start with strong demand and traffic trends. The companies are also optimistic that the growth momentum will be sustained through the rest of the year. Despite a weak start this year amid equity market volatility and global concerns, the construction sector seems to have recovered on the back of strong housing fundamentals. Positives like an improving economy, rising wages, favorable job outlook and a tight supply situation raise optimism about the sector’s performance for the rest of 2016.

Increase in home construction activity not only benefits homebuilders but also spurs demand for homebuilding materials, home decoration products and other related businesses. This, in turn, boosts the growth prospects of companies manufacturing these products.

Among these, construction materials companies Vulcan Materials Company VMC and Martin Marietta Materials, Inc. MLM reported solid Q1 earnings and sales surprises on the back of rising demand for their aggregates (used for construction activity). Building products manufacturers, Masco Corporation MAS and Headwaters Incorporated HW also delivered positive earnings surprises. Though Masco’s sales fell slightly short of expectations, sales at Headwaters beat the same. Increase in construction and repair as well as remodeling activity boosted sales at almost all segments for these two companies.

Three companies from the construction sector, Armstrong World Industries, Inc. AWI, Ply Gem Holdings, Inc. PGEM and Continental Building Products, Inc. CBPX are set to report their quarterly results on May 9. Will these companies put up a decent performance as well? Let’s have a look at what might be in store for them.

Armstrong World Industries

Pennsylvania-based, Armstrong World Industries is global leader in suspended ceiling solutions that are used in renovation as well as new construction. Last month, the company completed the previously announced spin-off of its flooring business into an independent public company, Armstrong Flooring, Inc.

The company posted a negative earnings surprise of 15.62% last quarter. The company surpassed estimates in two and missed expectations in the other two of the past four quarters. This resulted in an average positive surprise of 8.82%.

The company has an http://www.zacks.com/earnings/earnings-surprise-predictions/">Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for the quarter is pegged at 46 cents.

Ply Gem Holdings

The manufacturer of exterior building products posted a positive earnings surprise of 250.0% last quarter. The company surpassed estimates in three out of the past four quarters but missed the same in one, resulting in an average positive surprise of 61.56%.

The company has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for the quarter is pegged at a loss of 23 cents.

Continental Building Products

The building products company delivered in-line earnings last quarter. The company reported in-line earnings in two out of the past four quarters with an average negative surprise of 1.67%.

The company has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). The Zacks Consensus Estimate for the quarter is pegged at 16 cents.

Stay Tuned! Check later on our full write-up on earnings releases of these stocks.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. http://woas.zacks.com/adv/7stock_report.pdf?ADID=ZACKS_PFP_7... blog">Click to get this free report >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
MASCO (MAS): Free Stock Analysis Report
 
HEADWATERS INC (HW): Free Stock Analysis Report
 
CONTL BLDG PRD (CBPX): Free Stock Analysis Report
 
PLY GEM HOLDING (PGEM): Free Stock Analysis Report
 
ARMSTRONG WORLD (AWI): Free Stock Analysis Report
 
MARTIN MRT-MATL (MLM): Free Stock Analysis Report
 
PULTE GROUP ONC (PHM): Free Stock Analysis Report
 
LENNAR CORP -A (LEN): Free Stock Analysis Report
 
KB HOME (KBH): Free Stock Analysis Report
 
D R HORTON INC (DHI): Free Stock Analysis Report
 
To read this article on Zacks.com click here.