Masco Q3 Earnings Match Estimates, Sales Beat, EPS View Lowered

Masco Corporation MAS reported third-quarter 2024 results, wherein earnings met the Zacks Consensus Estimate and net sales marginally beat the same. Strong operational efficiency helped it deliver strong earnings amid challenging market conditions.Shares of Masco lost 0.3% in the pre-market trading session on Tuesday.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Masco’s focus on a balanced capital deployment strategy helped it return $255 million to shareholders via dividends and share repurchases.Masco lowered the upper limit of its 2024 adjusted earnings per share (EPS) guidance due to challenged market demand.Inside the HeadlinesMasco reported adjusted EPS of $1.08, which met the consensus mark and increased 8% from the year-ago figure of $1.00.Masco Corporation Price, Consensus and EPS Surprise Masco Corporation price-consensus-eps-surprise-chart | Masco Corporation QuoteNet sales of $1.98 billion beat the consensus estimate by 0.1% and increased 0.2% from the prior-year period. Net sales inched up 1% year over year in local currency.Sales in the North American region slipped 0.4% from the prior year. Internationally, sales increased 2.9% in local currency.MAS' Segmental AnalysisPlumbing Products: Sales in the segment grew 2% year over year to $1.22 billion. Currency had a minimal impact, and acquisitions increased sales by 1%. North American sales rose 2% year over year (up 1% excluding acquisitions) in local currency.The adjusted operating margin increased 100 basis points (bps) year over year to 19.9% on cost savings initiatives and higher volumes, partially offset by unfavorable mix and higher commodity and freight costs. Adjusted EBITDA increased to $269 million from $251 million a year ago.Decorative Architectural Products: The segment reported sales of $764 million, down 3% from the prior-year period. Sales of paints and other coating products decreased by low single digits. PRO paint sales increased by the high single digits, but DIY paint sales decreased by mid-single digits. Sales fell 1% excluding the impacts of currency and divestitures.Adjusted operating margin declined 20 bps to 18.1% due to timing of marketing spend, an unfavorable price/cost relationship and lower volume, partially offset by cost savings initiatives. Adjusted EBITDA declined to $147 million from the prior-year figure of $153 million.Margins PerformanceAdjusted gross margin improved 90 bps from the prior-year level to 36.7%. Adjusted selling, general and administrative expenses — as a percentage of net sales — were up 40 bps to 18.6% from the year-ago figure of 18.2%.Adjusted operating margin improved 60 bps on a year-over-year basis to 18.2%, backed by cost savings initiatives, partially offset by unfavorable mix and price/cost relationship and timing of marketing spend. Adjusted EBITDA grew 3.1% year over year to $397 million.FinancialsAs of Sept. 30, 2024, Masco had a total liquidity of $1.65 billion compared with $1.63 billion at 2023-end. This includes cash and cash investments of $646 million compared with $634 million recorded at 2023-end. Long-term debt was $2.945 billion, flat from 2023-end.Net cash from operating activities was $668 million in the first nine months of 2024 compared with $928 million in the prior-year period. During the reported period, the company repurchased 2.5 million shares for $192 million.2024 GuidanceThe company now expects its adjusted EPS in the range of $4.05-$4.15 compared with $4.05-$4.20 expected earlier. In 2023, adjusted EPS stood at $3.86.Net sales are now likely to be down in the low single digits from the 2023 level of $7.97 billion. Net sales in the Plumbing segment are still anticipated to increase/decrease in the low single digits, while those in Decorative Architectural are now expected to be down in the mid-single digits.Adjusted operating margin for the year is now expected to be nearly 17.5% (compared with the prior projection of 17-17.5%). It expects an adjusted operating margin of 19% in Plumbing (up from 18.5% expected earlier) and 18% in Decorative Architectural. In 2023, MAS generated an adjusted operating margin of 16.8%, wherein Plumbing reported 18% and Decorative Architectural posted 17.8%.Zacks RankMasco currently carries a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Recent Construction ReleasesWeyerhaeuser Company’s WY reported mixed results for third-quarter 2024. Its earnings beat the Zacks Consensus Estimate, while net sales missed the same.On a year-over-year basis, both metrics declined due to lower fee harvest volumes in the West, a decrease in domestic sales volumes as well as sales realizations accompanied by increased lumber manufacturing and raw materials costs.KBR, Inc. KBR reported mixed third-quarter fiscal 2024 results, with adjusted earnings surpassing the Zacks Consensus Estimate while revenues missed the same. The top and bottom lines increased on a year-over-year basis.The quarter’s results were backed by the benefits realized from the LinQuest acquisition and solid contributions from both the reportable businesses, given the increased demand trends for its services. Although high costs and expenses were trouble, leverage from the increased top line aided the uptick in the quarter.United Rentals, Inc. URI reported third-quarter 2024 results, wherein its EPS and revenues fell short of the Zacks Consensus Estimate. Nonetheless, both metrics registered improvement on a year-over-year basis.The company has tightened the outlook ranges for revenues, adjusted EBITDA, rental capital expenditures and net cash from operating activities while reaffirming the mid-points of its 2024 forecast.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant 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 Weyerhaeuser Company (WY): Free Stock Analysis Report Masco Corporation (MAS): Free Stock Analysis Report KBR, Inc. (KBR): Free Stock Analysis Report United Rentals, Inc. (URI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks