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TopBuild (BLD) Buys Creative Conservation, Expands in Virginia

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Zacks Equity Research
·3 min read
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TopBuild Corp. BLD recently acquired Creative Conservation, a residential and light commercial company. However, financial terms of the transaction have been kept under wraps.

Creative Conservation serves customers across Richmond, Charlottesville, Roanoke and Northern Virginia regions and has a business history of 40 years. Its installation line of business is uniformly split up between fiberglass and spray foam. During the 12 months ended Dec 31, 2020, the company generated approximately $7.4 million in revenues.

With respect to this, president and CEO of TopBuild, Ryan Ross, said, “Creative Conservation is an excellent addition to TopBuild with strong customer relationships, an experienced installer base, and extensive spray foam knowledge and expertise.”

Acquisition Driving Performance

Inorganic moves are a very important aspect of TopBuild’s growth strategy. Over the past 12 months, the company has concluded four acquisitions, thereby strengthening footprint in high-growth markets of Texas, Colorado, Tennessee and Virginia. These are expected to generate $217 million of annual revenues. Also, the company has a pipeline of various buyouts that are mainly focused on insulation business.

On Apr 5, 2021, the company completed the acquisition of the American Building Systems Group of Companies (ABS). Meanwhile, in March 2021, the company acquired Ozark Foam, a residential and light commercial insulation company. Notably, in 2020, the company completed three acquisitions that are expected to generate $79 million in annual revenues. In October 2020, the company completed the acquisition of Garland Insulating, one of the largest locally owned and operated insulation installation companies in Texas.

TopBuild’s shares have surged 151.4% in the past six months compared with the industry’s 76.6% rally. The company has been benefiting from robust U.S. housing market fundamentals, higher sales volumes and systematic inorganic strategy. Also, the company’s earnings estimates for 2021 have moved up over the past 30 days, depicting analysts’ optimism regarding its bottom-line growth potential.

Zacks Rank

TopBuild — which shares space with Masco Corporation MAS, Owens Corning OC and Aegion Corporation AEGN in the Zacks Building Products – Miscellaneous industry — currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Masco Corporation (MAS) : Free Stock Analysis Report

Aegion Corporation (AEGN) : Free Stock Analysis Report

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