Masco Corporation’s Earnings Report Sparks Investor Concern

Livonia, Michigan-based Masco Corporation (MAS) designs, manufactures, and distributes various home improvement and building products. With a market capitalization of $16.4 billion, MAS offers a range of decorative architectural products, as well as plumbing items like showerheads, bathtubs, toilets, and spas.

Over the past 52 weeks, Masco’s shares have underperformed compared to the broader market. The company has gained only 26.7%, while the S&P 500 Index ($SPX) rose by 31.1%. On a year-to-date basis, Masco’s shares are up 13.7%, while the S&P 500 has nearly reached a 24.1% return.

Narrowing down further, Masco has also fallen short against the Industrial Select Sector SPDR Fund (XLI), which reported a 31.4% gain over the past year and a year-to-date growth of 21.8%.

After releasing its Q3 earnings on October 29, shares of MAS dropped for three consecutive trading days. The company reported adjusted earnings of $1.08 per share, with revenues of $1.98 billion, meeting Wall Street’s estimates. However, the forecast for 2024 adjusted EPS and the flat year-over-year revenue growth may have led to a dip in investor confidence.

For the current fiscal year, ending December, analysts expect Masco’s EPS to grow nearly 6% year-over-year to $4.09. The company has shown a consistent track record of meeting or exceeding consensus estimates, achieving this feat in the past four quarters.

Currently, among the 18 analysts covering Masco, the consensus rating is a “Moderate Buy.” This assessment consists of eight “Strong Buy,” nine “Hold,” and one “Moderate Sell” rating.

On October 30, Truist reiterated a “Buy” rating on Masco and increased its price target to $92, signaling a potential upside of 20.8%. Meanwhile, the average price target stands at $87.22, reflecting a possible 14.5% gain from current price levels. The highest Street price target is $96, suggesting a significant upside potential of 26%.

On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.