Builders FirstSource (NYSE:BLDR) Issues Quarterly Earnings Results

Key Points

• Builders FirstSource missed quarterly expectations: EPS was $1.17 versus the $1.26 consensus, while revenue fell 8.8% year over year to $3.86 billion. Adjusted EBITDA declined 35% to $329 million as gross margin contracted amid weaker housing starts and pricing pressure.
• Management lowered 2026 guidance because of weaker housing demand, now forecasting $14.0 billion-$14.8 billion in net sales and $1.0 billion-$1.2 billion in adjusted EBITDA. The company raised its cost-savings target to $115 million and continues to pursue acquisitions while consolidating facilities and limiting capital spending.
• Shares traded near their one-year low after the results, while the board authorized a $500 million share-repurchase plan. Analysts maintain a consensus “Hold” rating with an average price target of $99.97.

Builders FirstSource (NYSE:BLDR - Get Free Report) posted its quarterly earnings results on Thursday. The company reported $1.17 earnings per share for the quarter, missing the consensus estimate of $1.26 by ($0.09), FiscalAI reports. The business had revenue of $3.86 billion during the quarter, compared to the consensus estimate of $3.92 billion. Builders FirstSource had a return on equity of 14.89% and a net margin of 1.97%.The company's revenue for the quarter was down 8.8% compared to the same quarter last year. During the same quarter in the previous year, the company earned $2.38 earnings per share.

Here are the key takeaways from Builders FirstSource's conference call:

• 2026 guidance was lowered to reflect weaker housing demand, with single-family starts expected to decline nearly 7%, multifamily starts 4%, and repair-and-remodel activity 1%. Net sales are now expected at $14.0-$14.8 billion and adjusted EBITDA at $1.0-$1.2 billion.
• Second-quarter net sales fell 9% to $3.9 billion, while adjusted EBITDA declined 35% to $329 million and adjusted EPS dropped 51% to $1.17. Gross margin contracted 260 basis points to 28.1% amid lower starts and competitive pricing pressure.
• Management said it maintained market share despite the weak environment and identified an additional $40 million of fixed-cost savings, increasing its 2026 cost-action target to $115 million. Productivity initiatives generated $28 million of savings in the quarter.
• BFS continues to pursue acquisitions and completed the purchase of Precision Design and Trim in Boise during June. Management sees substantial long-term M&A runway in the fragmented building-products market, although elevated leverage will remain a consideration.
• Demand remains pressured by high interest rates, affordability concerns, elevated builder inventories, and uncertainty, particularly in Texas, Colorado, and multifamily construction. The company is consolidating facilities, reducing capital expenditures, and preserving liquidity while positioning for a future housing recovery.

Builders FirstSource Price Performance

Shares of NYSE BLDR traded down $1.64 during midday trading on Thursday, reaching $66.12. 4,608,350 shares of the stock traded hands, compared to its average volume of 2,459,728. The company's 50 day moving average is $77.23 and its 200 day moving average is $90.42. Builders FirstSource has a one year low of $65.10 and a one year high of $151.03. The company has a debt-to-equity ratio of 1.15, a current ratio of 1.76 and a quick ratio of 1.09. The stock has a market capitalization of $7.11 billion, a PE ratio of 25.33, a P/E/G ratio of 1.81 and a beta of 1.42.

Builders FirstSource declared that its board has approved a share repurchase plan on Thursday, April 30th that permits the company to buyback $500.00 million in shares. This buyback authorization permits the company to purchase up to 5.4% of its stock through open market purchases. Stock buyback plans are often a sign that the company's board believes its shares are undervalued.

Wall Street Analyst Weigh In

BLDR has been the subject of a number of research reports. Zacks Research upgraded shares of Builders FirstSource from a "strong sell" rating to a "hold" rating in a research report on Friday, July 3rd. Truist Financial reduced their price target on shares of Builders FirstSource from $145.00 to $115.00 and set a "buy" rating on the stock in a report on Thursday, April 30th. Stephens decreased their price target on shares of Builders FirstSource from $125.00 to $100.00 and set an "equal weight" rating on the stock in a research note on Monday, April 27th. DA Davidson set a $100.00 price objective on shares of Builders FirstSource in a report on Thursday, July 23rd. Finally, Weiss Ratings downgraded shares of Builders FirstSource from a "sell (d+)" rating to a "sell (d)" rating in a report on Tuesday, July 21st. Nine analysts have rated the stock with a Buy rating, twelve have given a Hold rating and two have issued a Sell rating to the company. According to data from MarketBeat, the company currently has a consensus rating of "Hold" and a consensus target price of $99.97.

Institutional Investors Weigh In On Builders FirstSource

A number of hedge funds have recently bought and sold shares of the business. Daiwa Securities Group Inc. grew its stake in shares of Builders FirstSource by 0.4% in the 2nd quarter. Daiwa Securities Group Inc. now owns 17,630 shares of the company's stock worth $2,057,000 after buying an additional 78 shares in the last quarter. CIBC Private Wealth Group LLC raised its position in shares of Builders FirstSource by 5.9% during the 3rd quarter. CIBC Private Wealth Group LLC now owns 2,272 shares of the company's stock valued at $275,000 after buying an additional 126 shares in the last quarter. Caitong International Asset Management Co. Ltd raised its position in shares of Builders FirstSource by 167.1% during the 3rd quarter. Caitong International Asset Management Co. Ltd now owns 211 shares of the company's stock valued at $26,000 after buying an additional 132 shares in the last quarter. Vanguard Personalized Indexing Management LLC raised its position in shares of Builders FirstSource by 1.2% during the 4th quarter. Vanguard Personalized Indexing Management LLC now owns 11,229 shares of the company's stock valued at $1,155,000 after buying an additional 133 shares in the last quarter. Finally, Brown Brothers Harriman & Co. lifted its holdings in shares of Builders FirstSource by 39.5% in the 4th quarter. Brown Brothers Harriman & Co. now owns 547 shares of the company's stock valued at $56,000 after acquiring an additional 155 shares during the last quarter. Hedge funds and other institutional investors own 95.53% of the company's stock.

Builders FirstSource Company Profile

Builders FirstSource, Inc is a leading supplier of structural and value-added building products and services to professional contractors, homebuilders and remodelers. The company provides a comprehensive range of materials and prefabricated components that support all phases of residential construction, from site development and framing to finishing and installation.

The company's core offerings include lumber and lumber sheet goods, windows and doors, millwork, roofing and siding, and engineered wood products such as roof and floor trusses.

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