William Blair analyst Ryan Merkel has maintained their bullish stance on QXO stock, giving a Buy rating yesterday.
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Ryan Merkel has given his Buy rating due to a combination of factors that highlight QXO Inc’s strategic position in the building products distribution market. The recent acquisition activity by major players like Lowe’s and Home Depot indicates a trend of consolidation, which benefits large distributors like QXO by increasing the value of their assets. Despite the heightened competition for acquisitions, QXO is well-positioned to secure attractive deals, even if it means paying higher multiples for high-quality assets.
QXO’s leadership, under CEO Brad Jacobs, has a proven track record of successful strategic pivots, which adds confidence in their ability to navigate the competitive landscape. The potential for QXO to expand into new areas such as electrical or plumbing distribution further enhances their growth prospects. Additionally, the expectation of a forthcoming deal announcement supports the belief that QXO can achieve significant revenue growth, aiming for $50 billion by 2035. These factors collectively justify the Buy rating for QXO’s stock.