Griffon Corporation: A Strong Diversification Asset in Today’s Market
To manage risk and stabilize financial portfolios, “diversification” is crucial during economic downturns or periods of market uncertainty. Griffon Corporation’s GFF Stock presents a compelling option for investors.
Despite tariff concerns, Griffon is well-positioned to maintain and even grow its performance. This diversified holding company manufactures a variety of consumer products, including garage doors and health care items.
Griffon’s Zacks Diversified Operations Industry ranks in the top 10% among over 240 Zacks industries, with GFF earning a Zacks Rank #1 (Strong Buy) and being recognized as Bull of the Day.
Griffon’s Impressive EPS Growth
Griffon’s diverse portfolio contributes to its resilience and strong profitability, with annual earnings projected to rise by 11% in fiscal year 2025. Projections indicate a further increase of 21% in FY26, reaching $6.90 per share. Notably, Griffon’s EPS estimates reflect a staggering 325% increase from earnings of $1.62 per share in 2020.
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While total sales are expected to decline by 1% this year, forecasts suggest a recovery with a 3% increase in FY26, totaling $2.67 billion. EPS estimates for FY25 and FY26 have also risen by 3% and 7%, respectively, in the past 60 days.
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GFF Stock Performance & Valuation
Year to date, Griffon Stock has declined by 2%. However, over the last three years, it has surged by more than 270%, significantly outperforming broader market indexes.
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With rising EPS estimates indicating potential short-term gains, it’s worth noting that GFF trades at an attractive 12.3X forward earnings. This represents a significant discount compared to the S&P 500’s 20.4X and below the industry average of 15.7X forward earnings, with competitors like 3M MMM and Honeywell International HON.
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Griffon’s Dividend Growth
Additionally, GFF offers an annual dividend yield of 1.02%. The company has raised its dividend seven times over the last five years. With a 13% payout ratio, there is substantial potential for future increases.
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Conclusion
In light of the ongoing trade tensions between the U.S. and other nations, diversification is increasingly vital for investors. Griffon Corporation presents a solid diversification opportunity, boasting a strong buy rating and an overall “A” in the VGM Zacks Style Scores, signifying favorable value, growth, and momentum.
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Griffon Corporation (GFF) : Free Stock Analysis report
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This article originally published on Zacks Investment Research (zacks.com).
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The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.
