Installed Building (IBP) Tops on Q4 Earnings & Net Revenues
Installed Building Products, Inc. IBP reported impressive fourth-quarter 2023 results. Both earnings and net revenues surpassed the Zacks Consensus Estimate and increased on a year-over-year basis.
Installed Building’s shares rallied 10.1% on Feb 22, after the earnings release. The company witnessed healthy sales in the multi-family and commercial end markets amid softer single-family sales.
Jeff Edwards, chairman and chief executive officer of IBP, said, “I am pleased to report that during the 2024 first quarter, our Board of Directors increased our regular quarterly cash dividend by 6% to $0.35 per share and declared an annual variable dividend of $1.60 per share, representing a $0.70 per share increase over last year’s variable dividend.”
Inside the Headlines
Installed Building reported adjusted earnings per share (EPS) of $2.72 per share, which topped the Zacks Consensus Estimate of $2.53 by 7.5%. The metric also grew 11.9% year over year from $2.43 per share.
Installed Building Products, Inc. Price, Consensus and EPS Surprise
Installed Building Products, Inc. price-consensus-eps-surprise-chart | Installed Building Products, Inc. Quote
Net revenues of $720.7 million topped the consensus mark of $689 million by 4.6% and increased 5% year over year. On a same branch basis, net revenues grew 1.9% from the prior year, on modest improvements in the residential market and strong growth in the commercial end market. A 6.7% decline in single-family same branch sales was partially offset by a 29.5% increase in multifamily same branch sales.
Segmental Performance
Installation (accounted for 93% of total net sales): The segment’s net revenues came in at $669.8 million, up 4.5% year over year on multi-family and commercial sales growth, along with IBP's recent acquisitions, partially offset by softer single-family sales. The segment’s gross margin improved 240 basis points (bps) year over year to 36.4%.
Other (7%): The segment’s net revenues, including IBP’s manufacturing and distribution operations, rose 12% year over year to $50.9 million. The segment’s gross margin improved 500 bps year over year to 29.1%.
Operating Highlights
Gross profit increased 13% year over year to $245.7 million. Gross margin expanded 240 bps year over year to 34.1%.
Adjusted EBITDA improved 11.2% year over year to $128.3 million. Adjusted EBITDA margin expanded 100 bps to 17.8%, from the year-ago figure.
2023 Highlights
IBP generated net revenues of $2.8 billion, which increased 4.1% from 2022, and 0.2% on same branch basis. Gross margin expanded 350 bps year over year to 33.5%.
Adjusted EPS of $10.27 increased from $8.95 reported in 2022. Adjusted EBITDA increased 10.6% to $485.9 million and adjusted EBITDA margin expanded 100 bps from 2022 to 17.5%.
Financials
As of Dec 31, 2023, Installed Building had cash and cash equivalents of $386.5 million compared with $229.6 million at 2022-end. Long-term debt at 2023-end was $835.1 million, up from $830.2 million at 2022-end.
Net cash provided by operations was $340.2 million in 2023 compared with $277.9 million in the year-ago period.
Zacks Rank & Recent Construction Releases
Installed Building currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Armstrong World Industries, Inc. AWI reported impressive results for fourth-quarter 2023, wherein earnings and net sales topped the Zacks Consensus Estimate and increased on a year-over-year basis.
The company’s growth trend was backed by solid contributions from the Mineral Fiber as well as Architectural Specialties segments, despite soft market conditions. The growth was attributable to the increase in average unit value, driven by favorable pricing and volumes. Also, contributions from recent acquisitions aided the uptrend. This was reflected in record-setting sales and adjusted EBITDA growth, along with adjusted EBITDA margin expansion.
Owens Corning OC reported better-than-expected results for fourth-quarter 2023. Both earnings and net sales surpassed the Zacks Consensus Estimate and increased on a year-over-year basis.
The Roofing segment’s contributions, favorable price and cost mix, and manufacturing performance aided the uptrend. The Roofing segment’s net sales rose 16% year over year to $928 million, driven by strong demand tied to the mild weather extending the roofing season in many regions and strong components attachment rate, as well as favorable mix and positive price. For the first quarter of 2024, OC expects net sales to be slightly below the first quarter of 2023 while generating mid-teens margins.
Martin Marietta Materials, Inc. MLM reported mixed fourth-quarter 2023 results, with earnings surpassing the Zacks Consensus Estimate and increasing on a year-over-year basis. Revenues missed the consensus mark but rose year over year.
Going forward, MLM anticipates strong demand for infrastructure, large-scale energy and domestic manufacturing projects. This will largely offset weaker residential demand and the anticipated softening in light non-residential activity. With mortgage rates stabilizing and affordability headwinds receding, MLM fully expects single-family residential construction to recover as demand still exceeds supply, particularly in its key markets. For 2024, it expects consolidated products and services revenues of $6.75-$7.19 billion. Also, adjusted EBITDA is projected to be between $2.14 billion and $2.34 billion.
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
Martin Marietta Materials, Inc. (MLM) : Free Stock Analysis Report
Armstrong World Industries, Inc. (AWI) : Free Stock Analysis Report
Owens Corning Inc (OC) : Free Stock Analysis Report
Installed Building Products, Inc. (IBP) : Free Stock Analysis Report
