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Fortune Brands Innovations (FBIN)
NYSE:FBIN
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Fortune Brands Innovations
(NYSE:FBIN)
67Neutral
Positive Factors
Growth and Margin Expansion
Positives include medium-term growth/margin expansion opportunity in Connected Products and a strong balance sheet.
Operational Efficiency
The consolidation of regional offices into a centralized headquarters is expected to bring efficiencies and unify operations across all brands.
Strategic Leadership Changes
The company's CFO is transitioning into the role of President of Security & Connected Products, which should help with the sales conversion in connected products, a key driver for the company.
Negative Factors
Demand and Sales
Demand softness is likely to persist for the next couple of quarters.
Earnings and Guidance
4Q24 came in below BMO/consensus estimates. FY25 guidance fell short of current consensus estimates.
Revenue and Market Performance
FBIN reported 4Q24 earnings below our estimates driven by misses in all three sales segments.
Fortune Brands Innovations (FBIN) vs. S&P 500 (SPY)
Market Cap
$6.17B
Dividend Yield1.89%
Average Volume (3M)2.24M
Price to Earnings (P/E)15.0
Beta (1Y)1.22
Revenue Growth-3.48%
EPS Growth4.55%
CountryUS
Employees11,000
SectorIndustrials
Sector Strength83
IndustryConstruction
Share Statistics
EPS (TTM)0.66
Shares Outstanding120,260,640
10 Day Avg. Volume2,264,082
30 Day Avg. Volume2,243,856
Financial Highlights & Ratios
PEG Ratio-0.13
Price to Book (P/B)2.62
Price to Sales (P/S)0.00
P/FCF Ratio13.19
Enterprise Value/Market Cap1.40
Enterprise Value/Revenue0.46
Enterprise Value/Gross Profit4.25
Enterprise Value/Ebitda2.42
Forecast
1Y Price Target
$62.90Price Target Upside9.60% Upside
Rating ConsensusHold
Number of Analyst Covering10
Fortune Brands Innovations Business Overview & Revenue Model
Company DescriptionFortune Brands Innovations, Inc. provides water, outdoor, and security products, including water management, connected products, outdoor living, material conversion, sustainability, safety, and wellness. The company's portfolio of brands comprising Moen, House of Rohl, Aqualisa, Therma-Tru, Larson, Fiberon, Master Lock, and SentrySafe. Fortune Brands Innovations, Inc. was incorporated in 1988 and is headquartered in Deerfield, Illinois.
How the Company Makes MoneyFortune Brands Innovations makes money through the manufacturing and sale of its diverse range of home and security products. The company's revenue model primarily revolves around its key business segments: plumbing, cabinetry, and door hardware. Each segment contributes significantly to its overall earnings. The plumbing segment generates income from the sale of faucets, sinks, showers, and other related products, while the cabinetry segment earns revenue from offering kitchen and bathroom cabinets. Additionally, the door hardware segment provides locks, knobs, and other security solutions. The company leverages strong distribution networks and partnerships with retailers, wholesalers, and contractors to reach its target markets effectively. Strategic acquisitions and innovation in product design further bolster its revenue streams, enabling FBIN to maintain a competitive edge in the industry.
Fortune Brands Innovations Financial Statement Overview
Summary
Fortune Brands Innovations shows strengths in profitability metrics with improved net profit margins and operational efficiencies. However, declining revenue and high leverage pose risks. Cash flows are volatile with a recent decline in free cash flow, but cash generation relative to net income remains strong.Income Statement
Fortune Brands Innovations has shown a mixed performance in terms of revenue and profit margins. The overall revenue has decreased from $7.66 billion in 2021 to $4.61 billion in 2024, indicating a downward trend in top-line growth. However, the company has maintained a stable gross profit margin of 100% due to a unique reporting structure. The net profit margin improved to 10.23% in 2024 from 8.74% in 2023, reflecting better cost management. EBIT and EBITDA margins also show improvements, suggesting operational efficiencies.65
Positive
Balance Sheet
The balance sheet highlights a decrease in total assets from $7.94 billion in 2021 to $6.56 billion in 2024, coupled with a reduced stockholders' equity from $3.06 billion to $2.42 billion over the same period. The debt-to-equity ratio is relatively high at 1.15, indicating a leveraged position, although it has improved slightly from previous years. The return on equity increased to 19.48% in 2024, showcasing effective utilization of equity to generate profit. The equity ratio improved to 36.91%, suggesting a stronger equity position relative to total assets.70
Positive
Cash Flow
The cash flow statement reveals fluctuating operating cash flows, with a significant drop from $1.06 billion in 2023 to $667.8 million in 2024. Free cash flow exhibited a decline from $799.3 million to $667.8 million in the same period. The operating cash flow to net income ratio remains strong at 1.42 in 2024, indicating solid cash generation relative to net income. However, the free cash flow to net income ratio decreased, suggesting less cash is being retained after capital expenditures.63
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 4.61B | 4.63B | 4.72B | 7.66B | 6.09B | Gross Profit |
| 2.07B | 1.93B | 1.93B | 2.75B | 2.16B | EBIT |
| 737.90M | 614.90M | 774.30M | 1.09B | 801.40M | EBITDA |
| 932.20M | 812.20M | 964.70M | 982.70M | 1.02B | Net Income Common Stockholders |
| 471.90M | 404.50M | 539.90M | 772.40M | 553.10M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 381.10M | 366.40M | 642.50M | 471.50M | 419.10M | Total Assets |
| 6.56B | 6.57B | 6.12B | 7.94B | 7.36B | Total Debt |
| 2.79B | 2.81B | 2.67B | 2.71B | 2.57B | Net Debt |
| 2.41B | 2.45B | 2.03B | 2.24B | 2.15B | Total Liabilities |
| 4.14B | 4.27B | 4.04B | 4.87B | 4.58B | Stockholders Equity |
| 2.42B | 2.29B | 2.08B | 3.06B | 2.78B |
| Cash Flow | Free Cash Flow | |||
| 474.50M | 799.30M | 320.20M | 474.50M | 675.20M | Operating Cash Flow |
| 667.80M | 1.06B | 566.30M | 688.70M | 825.70M | Investing Cash Flow |
| -302.90M | -1.04B | -452.00M | -207.10M | -923.50M | Financing Cash Flow |
| -363.40M | -271.30M | 72.50M | -428.60M | 111.60M |
Fortune Brands Innovations Technical Analysis
Positive
57.39
Price Trends
57.00
Positive
63.28
Negative
71.86
Negative
Market Momentum
-0.97
Negative
57.33
Neutral
63.53
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FBIN, the sentiment is Positive. The current price of 57.39 is above the 20-day moving average (MA) of 52.55, above the 50-day MA of 57.00, and below the 200-day MA of 71.86, indicating a neutral trend. The MACD of -0.97 indicates Negative momentum. The RSI at 57.33 is Neutral, neither overbought nor oversold. The STOCH value of 63.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FBIN.
Fortune Brands Innovations Risk Analysis
Fortune Brands Innovations disclosed 24 risk factors in its most recent earnings report. Fortune Brands Innovations reported the most risks in the “Legal & Regulatory” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Fortune Brands Innovations Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $7.41B | 49.90 | 10.62% | ― | 5.93% | 3.50% | |
75 Outperform | $6.88B | 21.39 | 18.10% | 0.71% | 1.38% | -3.80% | |
74 Outperform | $6.31B | 15.92 | 24.41% | 1.17% | 8.09% | 55.08% | |
74 Outperform | $6.19B | 31.60 | 23.07% | ― | -9.10% | -21.50% | |
67 Neutral | $6.17B | 15.03 | 18.62% | 1.89% | -3.48% | 4.55% | |
64 Neutral | $4.36B | 12.05 | 5.23% | 249.94% | 4.13% | -10.23% | |
63 Neutral | $1.15B | 23.47 | 9.51% | ― | -13.95% | -63.37% |
* Industrials Sector Average
Performance Comparison
FBIN
Fortune Brands Innovations
57.39
-15.73
-21.51%
LPX
Louisiana-Pacific
94.50
7.30
8.37%
SSD
Simpson Manufacturing Co
164.37
-8.76
-5.06%
TREX
Trex Company
61.77
-25.82
-29.48%
JBI
Janus International Group
8.42
-5.39
-39.03%
AZEK
AZEK Company
51.49
6.84
15.32%
Fortune Brands Innovations Earnings Call Summary
Earnings Call Date:May 06, 2025
(Q1-2025)
| % Change Since: 8.69%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted significant achievements in the digital business and strategic partnerships, which bolster future prospects. However, challenges such as sales declines, particularly in the water innovations and security segments, and uncertainties surrounding tariff impacts and consumer demand, indicate a balanced outlook.Q1-2025 Updates
Positive Updates
Strong Performance in Digital Business
The digital business remains robust with over 200,000 device activations in the first quarter and is on track to deliver around $300 million in sales in 2025. Notably, the Flow sales increased by 180% over the first quarter of 2024.
Insurance Partnerships Boost Flow Business
The Flow business added three new major insurance partnerships in the first quarter, including Liberty Mutual Insurance. This is expected to drive strong momentum due to the product's value proposition of protecting homes and lowering insurance premiums.
US Manufacturing Advantage
60% of COGS are from the US, and 70% from North America, providing a competitive advantage especially in mitigating tariff impacts and taking share from competitors heavily reliant on China.
Positive Brand Developments
Moen was recognized as the most trusted brand of faucets for the 10th consecutive year. Master Lock and SentrySafe brand campaigns launched with positive upticks in sales and website traffic.
Negative Updates
Decline in Sales
First quarter sales were $1 billion, down 7% compared to the first quarter of 2024, reflecting a softer demand environment and inventory reductions across channels.
Challenges in Water Innovations Segment
Sales decreased by 10% or 7% organically, excluding China and FX. There were low single-digit POS declines and channel inventory reductions at wholesale and retail.
Uncertain Impact of Tariffs
The company expects to fully offset the $200 million tariff impact for 2025, but faces uncertainty in consumer demand, affecting the ability to provide detailed full-year financial guidance.
Security Segment Sales Decline
First quarter sales in the security segment declined 4%, reflecting low single-digit POS declines and continued destocking of older product lines.
Company Guidance
During the Fortune Brands First Quarter 2025 Earnings Conference Call, the company provided guidance indicating that despite the uncertainty of the external environment, they are focused on mitigating the anticipated $200 million tariff impact for 2025. They aim to offset this through supply chain opportunities, cost-out activities, and strategic pricing actions. The company expects the full annualized impact of tariffs in 2026 to be around $525 million, which they also plan to fully mitigate. Although they did not provide detailed full-year financial guidance due to consumer demand uncertainties, they outlined a framework where full-year EPS could range from $3.70 to $4.20, based on different volume scenarios. Fortune Brands Innovations remains committed to maintaining a strong balance sheet and leveraging their predominantly North American-based manufacturing footprint, with 60% of their COGS from the U.S. and 70% from North America, to drive market share growth and sustain strategic investments.Fortune Brands Innovations Corporate Events
Executive/Board ChangesFinancial Disclosures
Fortune Brands Innovations Appoints New CFO Jonathan Baksht
Positive
Apr 3, 2025
On April 3, 2025, Fortune Brands Innovations announced the appointment of Jonathan Baksht as Executive Vice President and Chief Financial Officer, effective May 5, 2025. Baksht, with extensive experience as a CFO in public companies, is expected to drive the company’s financial strategy and support growth opportunities. His predecessor, David Barry, will remain President of Security and Connected Products, ensuring a smooth transition. The company also scheduled its first-quarter 2025 earnings announcement and investor conference call for May 6, 2025.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.