Analyst Rafe Jadrosich of Bank of America Securities maintained a Buy rating on TopBuild (BLD – Research Report), reducing the price target to $320.00.
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Rafe Jadrosich has given his Buy rating due to a combination of factors including TopBuild’s attractive valuation and strong capital allocation strategies. Despite a challenging residential volume outlook with anticipated declines in single-family and multi-family revenues for 2025, the company has managed to maintain pricing better than expected. Additionally, the commercial and industrial segment is performing well, with expectations of growth at the high-end of low-single-digit percentages, supported by strong backlog and bidding activity in sectors like data centers, healthcare, and education.
TopBuild’s potential for market share gains in residential installation is another positive factor, given its size and scale advantages in a fragmented market. The company is also focused on mergers and acquisitions as a primary capital allocation strategy, with share repurchase as a secondary option if attractive deals are not available. Furthermore, the ongoing increase in insulation per house due to local code changes provides a slow but steady tailwind for growth. These factors collectively support the Buy rating with a price objective of $320.00 USD.
Jadrosich covers the Consumer Cyclical sector, focusing on stocks such as KB Home, Mohawk, and Somnigroup International. According to TipRanks, Jadrosich has an average return of 7.4% and a 54.26% success rate on recommended stocks.