Installed Building Products (NYSE:IBP) Shares Gap Down on Disappointing Earnings

Key Points

• Installed Building Products reported Q results with an EPS miss of $1.79 vs. $1.96 expected and revenue of $660.5M (vs. $668.9M), sending shares to gap down from $299.47 to an open of $259.50 and last trading near $240.33.
• The company paid a $1.80 special dividend on March 31 (record date March 13), which MarketBeat reports as a 63.0% yield and a 16.03% payout ratio.
• Analysts have trimmed ratings and targets (consensus rating "Reduce" and target $259.70), and insider activity was notable as CEO Jeffrey W. Edwards sold 400,000 shares for roughly $125.6M, cutting his stake by about 18.8%.

Installed Building Products, Inc. (NYSE:IBP - Get Free Report)'s stock price gapped down before the market opened on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $299.47, but opened at $259.50. Installed Building Products shares last traded at $240.3330, with a volume of 113,416 shares trading hands.

The construction company reported $1.79 earnings per share for the quarter, missing the consensus estimate of $1.96 by ($0.17). The company had revenue of $660.50 million during the quarter, compared to the consensus estimate of $668.92 million. Installed Building Products had a net margin of 8.93% and a return on equity of 43.71%. The firm's revenue was down 3.5% compared to the same quarter last year. During the same period in the prior year, the company earned $2.08 earnings per share.

Installed Building Products Dividend Announcement

The business also recently declared a special dividend, which was paid on Tuesday, March 31st. Shareholders of record on Friday, March 13th were issued a $1.80 dividend. This represents a yield of 63.0%. The ex-dividend date of this dividend was Friday, March 13th. Installed Building Products's dividend payout ratio is currently 16.03%.

Wall Street Analyst Weigh In

Several research analysts have weighed in on IBP shares. Wells Fargo & Company lowered their price target on shares of Installed Building Products from $340.00 to $285.00 and set an "equal weight" rating on the stock in a report on Wednesday, April 8th. Vertical Research raised shares of Installed Building Products from a "sell" rating to a "hold" rating and set a $326.00 price target on the stock in a report on Friday, February 27th. Zacks Research cut shares of Installed Building Products from a "strong-buy" rating to a "hold" rating in a report on Friday, January 16th. Wall Street Zen cut shares of Installed Building Products from a "buy" rating to a "hold" rating in a report on Sunday, March 29th. Finally, DA Davidson raised their target price on shares of Installed Building Products from $252.00 to $270.00 and gave the stock a "neutral" rating in a report on Wednesday, March 18th. One research analyst has rated the stock with a Buy rating, nine have given a Hold rating and two have assigned a Sell rating to the stock. According to data from MarketBeat, the company presently has an average rating of "Reduce" and a consensus target price of $259.70.

Insider Buying and Selling

In other Installed Building Products news, Director Janet E. Jackson sold 1,410 shares of the firm's stock in a transaction that occurred on Monday, March 9th. The shares were sold at an average price of $293.31, for a total value of $413,567.10. Following the sale, the director owned 5,373 shares in the company, valued at $1,575,954.63. This trade represents a 20.79% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at this link. Also, CEO Jeffrey W. Edwards sold 400,000 shares of the firm's stock in a transaction that occurred on Tuesday, March 3rd. The shares were sold at an average price of $314.06, for a total transaction of $125,624,000.00. Following the completion of the sale, the chief executive officer owned 1,727,819 shares in the company, valued at $542,638,835.14. This represents a 18.80% decrease in their position. The disclosure for this sale is available in the SEC filing. Company insiders own 13.80% of the company's stock.

Institutional Trading of Installed Building Products

A number of hedge funds have recently added to or reduced their stakes in the stock. Price T Rowe Associates Inc. MD boosted its position in Installed Building Products by 26.9% in the fourth quarter. Price T Rowe Associates Inc. MD now owns 1,551,161 shares of the construction company's stock valued at $402,356,000 after buying an additional 328,725 shares in the last quarter. Giverny Capital Inc. boosted its position in Installed Building Products by 0.9% in the fourth quarter. Giverny Capital Inc. now owns 519,236 shares of the construction company's stock valued at $134,685,000 after buying an additional 4,500 shares in the last quarter. First Trust Advisors LP boosted its position in Installed Building Products by 0.3% in the fourth quarter. First Trust Advisors LP now owns 400,748 shares of the construction company's stock valued at $103,950,000 after buying an additional 1,238 shares in the last quarter. Goldman Sachs Group Inc. boosted its position in Installed Building Products by 52.7% in the fourth quarter. Goldman Sachs Group Inc. now owns 355,211 shares of the construction company's stock valued at $92,138,000 after buying an additional 122,561 shares in the last quarter. Finally, Charles Schwab Investment Management Inc. boosted its position in Installed Building Products by 1.6% in the fourth quarter. Charles Schwab Investment Management Inc. now owns 350,996 shares of the construction company's stock valued at $91,045,000 after buying an additional 5,384 shares in the last quarter. Institutional investors and hedge funds own 99.61% of the company's stock.

Installed Building Products Price Performance

The company has a debt-to-equity ratio of 1.20, a current ratio of 3.03 and a quick ratio of 2.44. The stock has a market cap of $6.37 billion, a price-to-earnings ratio of 24.62, a price-to-earnings-growth ratio of 3.91 and a beta of 1.84. The business's 50-day simple moving average is $289.25 and its two-hundred day simple moving average is $283.47.

About Installed Building Products

Installed Building Products, Inc NYSE: IBP is a leading national installer of specialty building products serving the U.S. residential construction market. The company partners with homebuilders and contractors to deliver a comprehensive range of interior and exterior finishing services, including insulation, drywall finishing, protective coatings and basement waterproofing systems. By offering a single-source solution, Installed Building Products helps streamline project coordination and ensures consistent service quality across multiple trades.

Founded in 1977 and headquartered in Columbus, Ohio, Installed Building Products has expanded from a regional insulation installer into a nationwide platform operating in nearly every state.

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