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Builders Firstsource (BLDR)
NYSE:BLDR
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Builders Firstsource
(NYSE:BLDR)
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Rating:63Neutral
Price Target:
$119.00
▼(-4.09% Downside)
Builders Firstsource's overall stock score reflects a combination of strong balance sheet fundamentals and strategic initiatives, tempered by declining sales and profitability. Technical indicators suggest potential bearish momentum, while valuation metrics are moderate. The earnings call provided mixed insights, with strategic positives countered by market challenges.
Positive Factors
Strong Balance Sheet
A low debt-to-equity ratio indicates financial stability and flexibility, allowing the company to invest in growth opportunities without excessive leverage.
Digital Tools and Technology Adoption
The adoption of digital tools enhances operational efficiency and scalability, positioning the company for sustained growth in a digital-first market.
Successful M&A Strategy
Strategic acquisitions expand product offerings and market presence, strengthening competitive position and driving long-term growth.
Negative Factors
Decline in Net Sales
A decline in net sales reflects challenges in market demand and could impact revenue stability, necessitating strategic adjustments to regain momentum.
Pressure on Margins
Decreasing margins indicate reduced profitability, which can limit reinvestment in growth initiatives and affect long-term financial health.
Challenges in Housing Market
Ongoing housing market challenges may suppress demand for building materials, impacting sales and necessitating strategic pivots to adapt to market conditions.
Builders Firstsource (BLDR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$13.78B
Dividend YieldN/A
Average Volume (3M)1.51M
Price to Earnings (P/E)23.6
Beta (1Y)1.21
Revenue Growth-6.44%
EPS Growth-48.84%
CountryUS
Employees29,000
SectorIndustrials
Sector Strength72
IndustryConstruction
Share Statistics
EPS (TTM)1.88
Shares Outstanding110,580,580
10 Day Avg. Volume1,247,184
30 Day Avg. Volume1,508,214
Financial Highlights & Ratios
PEG Ratio-0.64
Price to Book (P/B)3.93
Price to Sales (P/S)1.03
P/FCF Ratio11.31
Enterprise Value/Market Cap1.00
Enterprise Value/Revenue0.88
Enterprise Value/Gross Profit2.84
Enterprise Value/Ebitda8.57
Forecast
1Y Price Target
$124.28Price Target Upside0.16% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Builders Firstsource Business Overview & Revenue Model
Company DescriptionBuilders FirstSource, Inc., together with its subsidiaries, manufactures and supplies building materials, manufactured components, and construction services to professional homebuilders, sub-contractors, remodelers, and consumers in the United States. It offers lumber and lumber sheet goods comprising dimensional lumber, plywood, and oriented strand board products that are used in on-site house framing; manufactured products, such as wood floor and roof trusses, steel roof trusses, wall panels, stairs, and engineered wood products; and windows, and interior and exterior door units, as well as interior and exterior trims and custom products under the Synboard brand name. The company also offers gypsum, roofing, and insulation products, including wallboards, ceilings, joint treatments, and finishes; and siding, metal, and concrete products, such as vinyl, composite, and wood siding products, as well as exterior trims, other exteriors, metal studs, and cement products. In addition, it provides other building products and services, such as cabinets and hardware, as well as turn-key framing, shell construction, design assistance, and professional installation services. The company was formerly known as BSL Holdings, Inc. and changed its name to Builders FirstSource, Inc. in October 1999. Builders FirstSource, Inc. was founded in 1998 and is based in Dallas, Texas.
How the Company Makes MoneyBuilders FirstSource generates revenue primarily through the sale of building materials and manufactured products to contractors, builders, and other construction-related businesses. Key revenue streams include sales of lumber, roofing, drywall, and other structural components, as well as manufactured goods like trusses and millwork. The company also benefits from strategic partnerships with suppliers and manufacturers, which enhance its product offerings and pricing competitiveness. Additionally, Builders FirstSource capitalizes on the construction industry's cyclical nature, often experiencing increased demand during housing booms, further contributing to its earnings.
Builders Firstsource Earnings Call Summary
Earnings Call Date:Oct 30, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 19, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted strategic investments in digital tools and successful acquisitions, alongside strong free cash flow and operational excellence. However, these positives were overshadowed by declines in net sales and profit margins, along with ongoing challenges in the housing market.Q3-2025 Updates
Positive Updates
Strong Free Cash Flow and Capital Deployment
Generated $548 million in operating cash flow and $465 million in free cash flow for the third quarter, with a trailing 12-month free cash flow yield of approximately 8%. Deployed over $100 million toward return-enhancing opportunities.
Digital Tools and Technology Adoption
Since launching in early 2024, digital tools have processed over $2.5 billion of orders and over $5 billion of quotes, representing increases in excess of 200% year-to-date, supporting operational agility and growth.
Successful M&A Strategy
Acquired St. George Truss Company and Builders Door & Trim, expanding value-added product offerings and strengthening market position in the Las Vegas area.
Operational Excellence and Productivity Savings
Generated $11 million in productivity savings in Q3, primarily through targeted supply chain initiatives.
Negative Updates
Decline in Net Sales and Gross Profit
Net sales decreased 6.9% to $3.9 billion, and gross profit decreased by 13.5% due to lower organic sales, commodity deflation, and declines in single-family and multifamily markets.
Pressure on Margins
Gross margin was down 240 basis points to 30.4%, and adjusted EBITDA margin dropped by 380 basis points to 11%, primarily due to lower gross profit margins and reduced operating leverage.
Challenges in Housing Market
Single-family construction remains soft due to affordability concerns and elevated new home inventories, while multifamily activity is expected to remain muted through year-end.
Company Guidance
During the Builders FirstSource Third Quarter 2025 Earnings Call, the company provided a detailed financial and strategic outlook amid a challenging housing market. Builders FirstSource reported a 6.9% decrease in net sales to $3.9 billion, primarily driven by a 12% decline in single-family and a 20% decline in multifamily sales, alongside commodity deflation. Despite these pressures, the company maintained a gross margin of 30.4%, attributing their resilience to operational discipline and strategic investments. Adjusted EBITDA was $434 million with an 11% margin, showcasing their ability to sustain profitability. The company highlighted $11 million in productivity savings and a $100 million capital deployment toward return-enhancing opportunities, including acquisitions and value-added solutions investments. Looking forward, Builders FirstSource forecasts 2025 net sales between $15.1 billion and $15.4 billion, with adjusted EBITDA ranging from $1.625 billion to $1.675 billion, supported by expected stabilization in the housing market and continued strategic focus on operational excellence, digital adoption, and M&A activities.Builders Firstsource Financial Statement Overview
Summary
Builders Firstsource shows a mixed financial performance. The balance sheet is strong with low leverage and solid equity, but the income statement reveals declining revenue and profitability. Cash flow generation is positive but under pressure, indicating challenges in maintaining financial health.Income Statement
Builders Firstsource's income statement shows a decline in revenue and profitability over the TTM period. The gross profit margin is healthy at 30.97%, but the net profit margin has decreased to 3.79%. Revenue growth has been negative, indicating challenges in maintaining sales momentum. The EBIT and EBITDA margins have also contracted, reflecting tighter operational efficiency.Balance Sheet
The balance sheet reflects a strong equity position with a debt-to-equity ratio of 0.15 in the TTM period, significantly improved from previous years. Return on equity is solid at 13.84%, although it has decreased from prior periods. The equity ratio remains stable, suggesting a balanced capital structure.Cash Flow
Cash flow analysis indicates a decline in free cash flow growth, down by 14.17% in the TTM period. The operating cash flow to net income ratio is robust at 0.76, suggesting efficient cash generation relative to net income. However, the free cash flow to net income ratio has decreased, indicating potential pressures on cash reserves.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 15.65B | 16.40B | 17.10B | 22.73B | 19.89B | 8.56B |
| Gross Profit | 4.85B | 5.38B | 6.01B | 7.74B | 5.85B | 2.22B |
| EBITDA | 1.61B | 1.60B | 2.73B | 4.27B | 2.93B | 660.42M |
| Net Income | 593.92M | 1.08B | 1.54B | 2.75B | 1.73B | 313.54M |
Balance Sheet | ||||||
| Total Assets | 11.43B | 10.58B | 10.50B | 10.60B | 10.71B | 4.17B |
| Cash, Cash Equivalents and Short-Term Investments | 296.16M | 153.62M | 66.16M | 80.44M | 42.60M | 423.81M |
| Total Debt | 5.08B | 4.33B | 3.71B | 3.49B | 3.40B | 1.91B |
| Total Liabilities | 7.11B | 6.29B | 5.77B | 5.63B | 5.91B | 3.02B |
| Stockholders Equity | 4.32B | 4.30B | 4.73B | 4.96B | 4.80B | 1.15B |
Cash Flow | ||||||
| Free Cash Flow | 1.02B | 1.49B | 1.83B | 3.26B | 1.52B | 147.99M |
| Operating Cash Flow | 1.39B | 1.87B | 2.31B | 3.60B | 1.74B | 260.07M |
| Investing Cash Flow | -1.34B | -710.72M | -668.29M | -957.48M | -1.34B | -136.22M |
| Financing Cash Flow | -88.69M | -1.07B | -1.65B | -2.60B | -780.11M | 285.87M |
Builders Firstsource Technical Analysis
Positive
124.08
Price Trends
107.35
Positive
118.79
Positive
120.02
Positive
Market Momentum
2.43
Negative
69.27
Neutral
91.15
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BLDR, the sentiment is Positive. The current price of 124.08 is above the 20-day moving average (MA) of 107.13, above the 50-day MA of 107.35, and above the 200-day MA of 120.02, indicating a bullish trend. The MACD of 2.43 indicates Negative momentum. The RSI at 69.27 is Neutral, neither overbought nor oversold. The STOCH value of 91.15 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BLDR.
Builders Firstsource Risk Analysis
Builders Firstsource disclosed 33 risk factors in its most recent earnings report. Builders Firstsource reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Builders Firstsource Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $8.65B | 28.71 | 38.03% | 0.66% | 15.10% | 23.35% | |
74 Outperform | $12.35B | 27.09 | 27.09% | 0.47% | 2.48% | -6.92% | |
71 Outperform | $7.42B | 21.78 | 17.82% | 0.69% | 4.26% | 8.52% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
63 Neutral | $13.78B | 23.61 | 13.56% | ― | -6.44% | -48.84% | |
53 Neutral | $14.40B | 17.76 | ― | 1.94% | -3.62% | 3.41% | |
52 Neutral | $10.06B | -21.27 | -3.27% | 2.43% | 3.47% | -148.53% |
* Industrials Sector Average
BLDR
Builders Firstsource
124.08
-30.17
-19.56%
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SSD
Simpson Manufacturing Co
179.85
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WMS
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.