RBC downgrades building product companies, flags 2027 headwinds
BUZZ-RBC downgrades building product companies, flags 2027 headwinds ** RBC Capital Markets downgrades building product firms Builders FirstSource BLDR.N and Owens Corning OC.N to "sector perform" rating from "outperform"
** Brokerage also downgrades flooring manufacturer Mohawk Industries MHK.N to "underperform" rating from "sector perform", citing weak flooring demand and mounting price and cost pressures
** Shares of BLDR, OC, and MHK down between 1 and 2% premarket
** RBC says new residential construction faces the most risk, while other construction markets remain uneven, and prefers distributors over manufacturers as inflation and cost pressures persist
** Near-term results could be uneven, but the bigger challenges are expected in 2027 because of timing issues, which could cause sharp swings in the stocks - RBC
** Following are the PT revisions on stocks:
Company Name | Previous PT | Current PT |
Builders FirstSource | $88 | $62 |
Core & Main | $60 | $57 |
Ferguson Enterprises | $290 | $286 |
Fortune Brands Innovations | $57 | $49 |
Installed Building Products | $228 | $208 |
Masco Corporation | $72 | $69 |
Mohawk Industries | $130 | $112 |
Owens Corning | $172 | $127 |
QXO, Inc | $27 | $18 |
SiteOne Landscape Supply | $135 | $124 |
Whirlpool Corporation | $32 | $22 |
(Reporting by Kanishka Ajmera in Bengaluru)
((mail to: Kanishka.Ajmera@thomsonreuters.com))