Maintaining Buy on QXO: Near-Term Roofing Weakness Outweighed by Long-Term M&A-Driven Growth Opportunity

William Blair analyst Ryan Merkel has maintained their bullish stance on QXO stock, giving a Buy rating on December 19.

Ryan Merkel has given his Buy rating due to a combination of factors that extend beyond the near-term softness in QXO’s roofing business. While he reduced EBITDA estimates for the fourth and first quarters on the back of weaker survey data, he views the sluggish finish to 2025 as largely cyclical and driven by transitory factors such as limited storm activity, subdued housing starts, and unfavorable December weather. In his assessment, these near-term headwinds do not alter the longer-term strategic opportunity, and he believes investors should treat periodic setbacks as chances to build positions in the stock.

Merkel places greater emphasis on QXO’s M&A opportunity set and its potential to drive substantial growth toward the company’s $50 billion revenue ambition. He highlights that management’s tone on acquisitions has turned more constructive, with active discussions spanning both smaller assets and larger, transformative targets across multiple verticals. In his view, the current macro backdrop is conducive to pursuing a sizable deal, and a successful transaction—especially one where operational improvements and technology can materially enhance profitability—would likely strengthen investor confidence and support further share price appreciation. Based on this strategic upside and the active deal pipeline, he maintains a Buy recommendation despite the near-term softness in fundamentals.

Merkel covers the Industrials sector, focusing on stocks such as Aaon, Fastenal Company, and QXO Inc. According to TipRanks, Merkel has an average return of 4.7% and a 53.05% success rate on recommended stocks.

In another report released on December 19, Wells Fargo also maintained a Buy rating on the stock with a $30.00 price target.