Raymond James has adjusted its price target for Builders FirstSource (BLDR, Financial), lowering it from $170 to $140, while maintaining an Outperform rating on the shares. The decision comes as the construction activity for both single-family and multi-family homes continues to face challenges. This struggle is attributed to the ongoing high interest rate environment, which has impeded housing starts as builders strive to tackle affordability concerns.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 20 analysts, the average target price for Builders FirstSource Inc (BLDR, Financial) is $152.35 with a high estimate of $193.00 and a low estimate of $125.00. The average target implies an upside of 36.11% from the current price of $111.93. More detailed estimate data can be found on the Builders FirstSource Inc (BLDR) Forecast page.
Based on the consensus recommendation from 20 brokerage firms, Builders FirstSource Inc's (BLDR, Financial) average brokerage recommendation is currently 1.9, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Builders FirstSource Inc (BLDR, Financial) in one year is $142.84, suggesting a upside of 27.62% from the current price of $111.93. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Builders FirstSource Inc (BLDR) Summary page.
BLDR Key Business Developments
Release Date: May 01, 2025
- Net Sales: Decreased 6% to $3.7 billion.
- Gross Profit: $1.1 billion, a decrease of 14% compared to the prior year.
- Gross Margin: 30.5%, down 290 basis points.
- Adjusted SG&A: $771 million, decreased by $9 million.
- Adjusted EBITDA: $369 million, down 32%.
- Adjusted EBITDA Margin: 10.1%, down 380 basis points.
- Adjusted EPS: $1.51, a decrease of 43% compared to the prior year.
- Operating Cash Flow: $132 million, a decrease of $185 million.
- Free Cash Flow: $45 million.
- Net Debt to Adjusted EBITDA Ratio: Approximately 2 times.
- Total Liquidity: $1.1 billion.
- Capital Expenditures: $87 million in the first quarter.
- Share Repurchases: 100,000 shares for $13 million in Q1; 3.3 million shares for $391 million in April.
- 2025 Net Sales Guidance: $16.05 billion to $17.05 billion.
- 2025 Adjusted EBITDA Guidance: $1.7 billion to $2.1 billion.
- 2025 Free Cash Flow Guidance: $800 million to $1.2 billion.
- Q2 Net Sales Guidance: $4.1 billion to $4.4 billion.
- Q2 Adjusted EBITDA Guidance: $475 million to $525 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Builders FirstSource Inc (BLDR, Financial) achieved $17 million in productivity savings in Q1 through targeted supply chain initiatives and efficient manufacturing processes.
- The company invested $23 million in value-added facilities to prepare for future demand, including opening a new millwork location and upgrading a truss facility.
- Digital sales increased by $19 million in the quarter, bringing total digital sales to $153 million since launch, indicating strong adoption of BFS digital tools.
- Builders FirstSource Inc (BLDR) completed two acquisitions in Q1 with aggregate prior year sales of $565 million, enhancing its market position.
- The company maintained a strong liquidity position with $1.1 billion in total liquidity, including $944 million in net borrowing availability and $115 million in cash.
Negative Points
- Net sales decreased by 6% to $3.7 billion, driven by lower organic sales, one fewer selling day, and commodity deflation.
- Gross profit decreased by 14% to $1.1 billion, with gross margins down 290 basis points due to margin normalization and a below-normal starts environment.
- Adjusted EBITDA fell by 32% to $369 million, primarily due to lower gross profit, with adjusted EBITDA margin down 380 basis points.
- The company experienced a 33% decline in multifamily sales, contributing to the overall decrease in net sales.
- Builders FirstSource Inc (BLDR) faces ongoing margin pressure and competitive dynamics in a challenging market environment.
