Armstrong World (AWI) AI Stock Analysis

• Market Cap: $7.52B
• Dividend Yield: 0.66%
• Average Volume (3M): 513.76K
• Price to Earnings (P/E): 24.6
• Beta (1Y): 0.87
• Revenue Growth: 15.10%
• EPS Growth: 23.35%
• Country: US
• Employees: 3,600
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 1.61
• Shares Outstanding: 42,834,050
• 10 Day Avg. Volume: 607,534
• 30 Day Avg. Volume: 513,762
• PEG Ratio: 1.60
• Price to Book (P/B): 9.25
• Price to Sales (P/S): 5.14
• P/FCF Ratio: 23.44
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 4.61
• Enterprise Value/Gross Profit: 11.34
• Enterprise Value/Ebitda: 12.18
• 1Y Price Target: $203.50
• Price Target Upside: 15.91% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 8.31
• Revenue Forecast (FY): $1.77B

• Rating: 65 Neutral
• Price Target: $187.00 ▲(6.51% Upside)
• Action: Downgraded Date: 02/25/26
• Date: Action: Downgraded 02/25/26

AWI scores well on financial performance (high margins, sharply improved leverage, solid cash generation) and the earnings outlook is constructive with management guiding to growth and margin expansion. The overall score is held back primarily by weak technicals (below major moving averages with bearish momentum) and a valuation that looks less compelling at ~27x earnings with a low dividend yield.

Positive Factors

High and Improving Profitability

Sustained high gross and net margins indicate durable pricing power and operational efficiency across cycles. This margin profile supports strong return on capital, funds product R&D and capacity investments, and provides a buffer against input inflation, underpinning multi‑quarter cash generation and shareholder returns.

Material Deleveraging / Balance Sheet Strength

Sharp reduction in leverage materially lowers financial risk and increases flexibility for M&A, share repurchases and dividends. A lightweight capital structure improves resilience to cyclical construction demand, reduces interest exposure, and enables disciplined capital allocation over the next several quarters.

Product Innovation & AS Capability Expansion

New energy‑saving and data center products plus targeted tuck‑ins extend addressable markets and raise average unit value. Strengthened Architectural Specialties design/fabrication capabilities create higher‑margin, specification‑driven revenue streams, supporting durable top‑line mix shift and long‑term margin uplift.

Negative Factors

Mineral Fiber Volume Shortfall

Persistent volume gap implies structural headroom is required to return to historic throughput. Until volumes recover, the company remains exposed to slower unit growth and must rely on pricing and mix to offset fixed costs. This prolongs dependency on AUV gains for sustainable revenue growth.

Imperfect Earnings-to-Cash Conversion

FCF trailing reported earnings by ~25%, suggesting working‑capital swings, higher capex or other cash uses. Structural gaps between accounting earnings and cash reduce excess distributable cash in downturns, constrain rapid deleveraging or opportunistic M&A, and raise sensitivity to cyclical cash volatility.

Acquisition & Integration Pressure on Margins

Ongoing integration, higher SG&A and stepped‑up capex tied to acquisitions and capacity investments can depress near‑term margins and create project timing volatility. If sustained, these structural cost increases could slow margin recovery and raise execution risk as AS scales into more complex, turnkey projects.

Armstrong World Business Overview & Revenue Model

Company Description

Armstrong World Industries, Inc., together with its subsidiaries, designs, manufactures, and sells ceiling systems primarily for use in the construction and renovation of residential and commercial buildings in the United States, Canada, and Latin America. The company operates through Mineral Fiber and Architectural Specialties segments. The company produces suspended mineral fiber, soft fiber, fiberglass wool, and metal ceiling systems, as well as wood, wood fiber, glass-reinforced-gypsum, and felt ceiling and wall systems; ceiling component products, such as ceiling perimeters and trims, as well as grid products that support drywall ceiling systems; ceilings and walls for use in commercial settings; and acoustical controls, facades, and partitions. It sells its commercial ceiling and architectural specialties products to resale distributors and ceiling system contractors; and residential ceiling products to wholesalers and retailers, such as large home centers. The company was incorporated in 1891 and is headquartered in Lancaster, Pennsylvania.

How the Company Makes Money

Armstrong World Industries generates revenue primarily through the sale of its ceiling and wall products to contractors, architects, and builders in various sectors, including commercial, residential, and institutional markets. The company's revenue model is based on the direct sale of products through a network of distributors and dealers, as well as through direct sales to large contractors and developers. Key revenue streams include the sale of acoustic ceiling tiles, suspension systems, and specialty wall products. Additionally, AWI benefits from strategic partnerships with construction firms and architectural firms that specify its products for projects, enhancing its market reach. The company also focuses on innovation and product development, which helps drive sales and capture market share in a competitive landscape.

Armstrong World Financial Statement Overview

Summary

Strong overall fundamentals: high and improving profitability (gross margin ~40%, net margin ~19% TTM), sharply reduced leverage (debt-to-equity ~0.12), and healthy operating cash flow. Key offsets are historical earnings volatility (notably 2020 loss) and free cash flow running below net income (~three-quarters), indicating imperfect earnings-to-cash conversion.

Income Statement

AWI shows a strong earnings profile with TTM (Trailing-Twelve-Months) revenue up sharply versus the prior annual period and consistently high profitability: gross margin ~40% and net margin ~19% in TTM, improving from the low-to-mid teens earlier in the period. Operating profitability is also solid and stable (EBIT margin mid-to-high 20s across recent years). A key weakness is the historical volatility seen in 2020, when the company posted a net loss and negative operating margin, highlighting that results can swing under stress even though the more recent trajectory is clearly favorable.

Balance Sheet

Balance sheet strength improved materially: total debt fell dramatically in TTM while equity rose, driving debt-to-equity down to a very low ~0.12 from ~0.79 in 2024 and above 1.0 in 2021–2023. Profitability on shareholder capital remains strong (return on equity in the mid-to-high 30% range in recent periods). The main watch-out is that earlier periods carried heavier leverage, indicating the capital structure has historically been more debt-reliant even though it appears substantially de-risked now.

Cash Flow

Cash generation is healthy and improving: TTM (Trailing-Twelve-Months) operating cash flow is strong and comfortably exceeds net income, and free cash flow is solid with significant growth versus the prior annual period. However, free cash flow is still meaningfully below reported earnings in TTM (roughly three-quarters of net income), suggesting working-capital swings, investment needs, or other cash uses are limiting full earnings-to-cash conversion.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.62B	1.45B	1.30B	1.23B	1.11B
Gross Profit	658.70M	581.60M	497.00M	449.30M	405.90M
EBITDA	433.30M	495.60M	434.30M	368.40M	370.60M
Net Income	308.70M	264.90M	223.70M	199.60M	185.00M
Balance Sheet
Total Assets	1.92B	1.84B	1.67B	1.69B	1.71B
Cash, Cash Equivalents and Short-Term Investments	112.70M	79.30M	70.80M	106.00M	98.10M
Total Debt	531.80M	599.90M	640.40M	687.00M	671.60M
Total Liabilities	1.02B	1.09B	1.08B	1.15B	1.19B
Stockholders Equity	900.70M	757.10M	591.80M	535.00M	519.70M
Cash Flow
Free Cash Flow	355.50M	184.00M	149.70M	107.60M	107.40M
Operating Cash Flow	355.50M	266.80M	233.50M	182.40M	187.20M
Investing Cash Flow	-3.60M	-79.30M	-10.40M	28.20M	-13.90M
Financing Cash Flow	-319.30M	-177.60M	-258.60M	-201.90M	-212.10M

Armstrong World Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 175.57
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AWI, the sentiment is Negative. The current price of 175.57 is below the 20-day moving average (MA) of 191.58, below the 50-day MA of 191.46, and below the 200-day MA of 183.38, indicating a bearish trend. The MACD of -2.81 indicates Positive momentum. The RSI at 34.02 is Neutral, neither overbought nor oversold. The STOCH value of 12.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AWI.

Armstrong World Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WMS	76 Outperform	$13.31B	28.39	26.50%	0.47%	2.48%	-6.92%
SSD	71 Outperform	$8.20B	24.01	18.00%	0.69%	4.26%	8.52%
AWI	65 Neutral	$7.52B	24.62	37.24%	0.66%	15.10%	23.35%
MAS	64 Neutral	$15.04B	19.15	―	1.94%	-3.62%	3.41%
OC	64 Neutral	$10.41B	-21.35	-4.21%	2.43%	3.47%	-148.53%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
AAON	61 Neutral	$8.24B	83.80	12.08%	0.53%	8.77%	-47.50%

Armstrong World Corporate Events

Armstrong World Posts Record 2025 Results, Eyes 2026 Growth

On Feb. 24, 2026, Armstrong World Industries reported record fourth-quarter and full-year 2025 results, with Q4 net sales up 5.6% to $388.3 million, operating income up 12.3%, and adjusted EBITDA up 11.5%, driven by higher Average Unit Value and contributions from its 2024 acquisitions. Full-year 2025 net sales rose 12% to $1.6 billion, with operating income up 15%, EPS up 18%, and cash flow from operating and investing activities up 88%, underscoring resilient profitability, successful integration of Architectural Specialties acquisitions, and a solid platform for a planned CEO transition and continued growth in 2026.

Mineral Fiber delivered margin expansion on favorable pricing despite softer volumes linked to indirect effects from a federal government shutdown and weaker home center demand, while Architectural Specialties posted double-digit sales growth but lower margins amid acquisition-related costs. Management highlighted that 2025 marked a second consecutive year of double-digit sales and earnings growth and the fifth straight year of profitable top- and bottom-line gains, reinforcing Armstrong’s positioning as a differentiated, cash-generative building products player for investors and other stakeholders.

The most recent analyst rating on (AWI) stock is a Buy with a $227.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.

Armstrong World Appoints New General Counsel and Secretary

On February 20, 2026, Armstrong World Industries announced that Jessica M. Cicali will become senior vice president, general counsel and secretary effective April 1, 2026, succeeding Austin K. So as part of a broader management transition on that date. In addition to overseeing legal affairs, she will also lead sustainability and government relations, consolidating several strategic functions under her remit.

Cicali brings more than two decades of legal, compliance, regulatory and business partnership experience from global manufacturing, infrastructure and technology companies, most recently as chief legal and compliance officer and corporate secretary at S&B USA. Incoming president and CEO Mark Hershey highlighted her track record in complex transactions, regulatory navigation and government affairs, signalling that her appointment is intended to strengthen Armstrong’s executive bench and support its strategic and operational priorities.

The most recent analyst rating on (AWI) stock is a Buy with a $227.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.

Armstrong World Completes Acquisition of Custom Design Firm Eventscape

On Feb. 19, 2026, Armstrong World Industries announced it had completed the acquisition of Eventscape, Inc., a Toronto- and New York‑based specialist in the design, fabrication and installation of complex custom architectural features, funded with a mix of existing cash and its revolving credit facility. Eventscape, founded in 1999 and generating about $30 million in 2025 revenue with 150 staff, brings advanced parametric modeling and material‑agnostic capabilities across ceilings, feature walls, facades and public art for marquee North American projects.

The deal significantly expands Armstrong’s Architectural Specialties design and fabrication capabilities and broadens its access to high‑end commercial building projects, reinforcing its strategy of portfolio expansion into custom design leadership. By integrating Eventscape’s engineering and turnkey project execution with Armstrong’s existing specialty solutions and prior acquisitions, the company aims to collaborate more closely with architects from concept to installation, enhancing its competitive positioning in complex, design‑driven environments.

The most recent analyst rating on (AWI) stock is a Buy with a $227.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.

Armstrong World Declares Quarterly Cash Dividend for 2026

Armstrong World Industries, Inc., an Americas leader in ceilings, specialty walls and exterior metal architectural solutions, reported 2024 revenue of $1.4 billion and operates 22 manufacturing facilities plus seven WAVE joint venture sites with a workforce of approximately 3,800 employees. The company focuses on products that support elevated aesthetics, acoustic performance and sustainable building design for architects, designers and contractors.

On February 18, 2026, Armstrong World Industries announced that its board of directors declared a quarterly cash dividend of $0.339 per share of common stock, payable on March 19, 2026, to shareholders of record as of March 5, 2026. The decision underlines the company’s ongoing capital-return posture, while future dividends and capital allocation remain subject to board discretion based on Armstrong’s financial condition, operating results and cash flow.

The most recent analyst rating on (AWI) stock is a Buy with a $227.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.

Armstrong World announces leadership transition and executive departure

Armstrong World Industries is undergoing a broader board and management transition taking effect on April 1, 2026, including previously announced changes to its Executive Chair and President and Chief Executive Officer roles. As part of this transition, the company and Austin K. So, its Senior Vice President, General Counsel, Head of Government Relations & Chief Sustainability Officer and Secretary, finalized a mutual separation agreement on January 27, 2026, with his departure effective April 1, 2026; his compensation and employment terms remain unchanged, and his separation benefits will follow an existing severance agreement and equity award arrangements.

The most recent analyst rating on (AWI) stock is a Buy with a $227.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.

Armstrong World Announces CEO Transition and Leadership Changes

On January 14, 2026, Armstrong World Industries announced that President and CEO Vic Grizzle will transition to Executive Chair and that Senior Vice President and Chief Operating Officer Mark Hershey will become President, CEO and a board member, effective April 1, 2026, as part of a long-planned succession process. The move will expand the board to nine members, see current Chair Roy Templin shift to lead independent director, and adjust executive pay packages to reflect Grizzle’s reduced role and Hershey’s promotion, underscoring the board’s confidence in internal leadership continuity after a decade of strong growth and strategic transformation under Grizzle, including portfolio reshaping and multiple acquisitions.

The most recent analyst rating on (AWI) stock is a Buy with a $207.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.

Armstrong World Secures $500M Credit Facility Amendment

On December 10, 2025, Armstrong World Industries, Inc. amended its credit agreement to secure a $500 million revolving credit facility and a $410.625 million term loan, both maturing in 2030. This amendment enhances AWI’s financial flexibility with features like an uncommitted accordion for additional capacity, while maintaining stringent covenants and security interests, potentially impacting its operational liquidity and stakeholder confidence.

The most recent analyst rating on (AWI) stock is a Buy with a $209.00 price target. To see the full list of analyst forecasts on Armstrong World stock, see the AWI Stock Forecast page.