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Kingspan Group plc (KGSPY)
OTHER OTC:KGSPY
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Kingspan Group
(OTC:KGSPY)
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Rating:71Outperform
Price Target:
$92.00
▲(10.68% Upside)
Action:ReiteratedDate:02/26/26
The score is driven primarily by solid financial performance and a strong technical uptrend. Earnings-call guidance and demand/backlog commentary add support despite near-term headwinds (FX, working capital, input inflation, and roofing ramp). Valuation is the main restraint due to a higher P/E and low dividend yield.
Positive Factors
Strong free cash flow and liquidity
Sustained free cash flow and sizeable committed liquidity provide durable financial flexibility for capex, M&A and cyclical shocks. With €429m FCF and undrawn facilities plus cash, the group can fund its EUR1.2bn investment pipeline and roof/buildout rollouts without immediate balance sheet strain.
Advances business backlog and intake
A growing Advances backlog and doubled intake signal structural demand and multi-quarter revenue visibility, improving predictability of margins and cash conversion. Longer backlog (c.9 months) supports steady revenue recognition, underpinning medium-term EBITDA and strategic scale in higher-value offerings.
Insulated panel demand strength
Consistent growth in core insulated panel orders reflects durable structural demand for energy‑efficient building envelopes. As a core product set, sustained intake growth supports utilization, pricing power on engineered systems, and recurring revenue from refurbishment and new construction markets across geographies.
Negative Factors
Weakened cash conversion
Declining cash conversion signals more earnings tied up in working capital and investment, reducing the quality of reported profits. Persistent weaker conversion can constrain organic funding for growth, increase reliance on external financing, and magnify stress if revenues dip or capex intensifies.
Gradually rising leverage
An upward trend in leverage reduces financial headroom and heightens sensitivity to cash flow volatility. While current ratios remain manageable, continued acquisitive deployment and higher debt could limit flexibility for opportunistic investment and increase refinancing or covenant risks during adverse cycles.
Roofing rollout margin and ramp risk
Entering a new market with initially low margins and multi-year ramp creates execution risk that can dilute group profitability. The roofing rollout requires capex, operational scale-up and route-to-market buildout; prolonged underperformance would pressure group margins and absorb management attention and cash.
Kingspan Group (KGSPY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$15.01B
Dividend Yield0.6%
Average Volume (3M)936.00
Price to Earnings (P/E)21.1
Beta (1Y)0.73
Revenue Growth10.21%
EPS Growth8.80%
CountryUS
Employees24,802
SectorIndustrials
Sector Strength72
IndustryConstruction
Share Statistics
EPS (TTM)2.31
Shares Outstanding180,068,570
10 Day Avg. Volume1,690
30 Day Avg. Volume936
Financial Highlights & Ratios
PEG Ratio-15.24
Price to Book (P/B)3.04
Price to Sales (P/S)1.54
P/FCF Ratio30.00
Enterprise Value/Market Cap1.02
Enterprise Value/Revenue1.67
Enterprise Value/Gross Profit5.67
Enterprise Value/Ebitda12.99
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Kingspan Group Business Overview & Revenue Model
Company DescriptionKingspan Group plc, together with its subsidiaries, provides insulation and building envelope solutions in the Republic of Ireland, the United Kingdom, rest of Europe, the Americas, and internationally. It operates through five segments: Insulated Panels, Insulation, Light & Air, Water & Energy, and Data & Flooring. The Insulated Panels segment manufactures insulated panels, structural framing, and metal facades components. The Insulation segment provides rigid insulation boards, technical insulation, and engineered timber systems. The Light & Air segment manufactures daylighting, smoke management, and ventilation systems. The Water & Energy segment provides energy and water solutions, and related services. The Data & Flooring segment offers data centre storage solutions, as well as raised access floors. It also engages in the trustee and finance businesses. The company was founded in 1965 and is headquartered in Kingscourt, Ireland.
How the Company Makes MoneyKingspan primarily makes money by manufacturing and selling building products to contractors, builders, distributors, and project owners. Its core revenue streams come from (1) insulated panel systems used for walls, roofs, and cold storage applications, where Kingspan supplies engineered panel products for new construction and refurbishment projects; (2) insulation products (such as rigid insulation boards and other thermal insulation solutions) sold into building envelope applications to help meet energy-efficiency and building-code requirements; and (3) other building product lines that complement the envelope/insulation offering. Revenue is generally recognized from product sales, with earnings driven by construction activity levels, renovation demand, product mix (higher-value engineered systems vs. commodity materials), pricing relative to key inputs, and geographic/end-market diversification. The company can also earn through project-specific specifications and long-term customer relationships in which its products are designed into building plans, supporting repeat sales and demand for compatible components and accessories. Specific partnership details are not available in this context and are therefore null.
Kingspan Group Earnings Call Summary
Earnings Call Date:Feb 20, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 14, 2026
Earnings Call Sentiment Positive
The call presents a broadly positive operational and financial picture: strong top‑line growth at constant currency, solid EBITDA, improving Advances momentum (double intake, +12% revenue, +24% backlog), robust free cash flow and a healthy balance sheet with committed liquidity. Management reiterated medium‑term growth ambitions, a material investment pipeline and confidence in passing through input inflation. Offsetting factors include FX headwinds, some working capital timing effects, weather‑related Q1 softness, ongoing input inflation (especially steel), initial margin dilution in the new U.S. roofing rollout and non‑bankable elements of the backlog. On balance the positives—notably demand, backlog strength, cash generation, emissions progress and a clear capital allocation plan—outweigh the near‑term headwinds.Q4-2025 Updates
Positive Updates
Revenue Growth
Group revenue of EUR 9.2 billion, up 7% reported and up 9% at constant exchange rates year‑on‑year.
EBITDA, Trading Profit and EPS
Group EBITDA of EUR 1.22 billion (up 7% year‑on‑year). Trading profit of EUR 955 million (up 5% reported, up 8% at constant exchange rates). Earnings per share EUR 3.70.
Strong Free Cash Flow and Balance Sheet
Free cash flow of EUR 429 million. Net debt EUR 1.88 billion with net debt/EBITDA leverage of 1.65x. Liquidity includes an undrawn EUR 800 million green RCF and approximately EUR 600 million cash on hand.
Advances Business Momentum
Advances revenue up 12% for the year, backlog ahead 24% at year‑end, and order intake in the Advances product set doubled versus prior year in the first 6 weeks; backlog provides roughly 9 months' visibility and is lengthening.
Insulated Panel Demand
Insulated panel order bank ahead 8% year‑end and intake for the same product group ahead 8% in the first 6 weeks of the new year, supporting near‑term activity.
Scope 1 & 2 Emissions Reduction
Since 2020 the group reports a 70% reduction in internal Scope 1 and 2 emissions, supporting sustainability credentials and green financing profile.
Capital Allocation and M&A Activity
Acquisitions contributed approximately EUR 707 million of incremental revenue year‑over‑year and EUR 49.5 million to trading profit. Deployed EUR 258 million on acquisitions, incurred EUR 168 million deferred consideration, and repurchased 2.2 million shares for EUR 148.6 million. Announced share buyback program ~23% completed.
Investment Pipeline and Growth Guidance
Planned investment pipeline of ~EUR 1.2 billion to unlock ~EUR 2 billion of revenue over time. Management expects around 10% earnings growth in the current year and sees acceleration into 2027–2028; confident in medium‑term Advances targets (e.g., EUR 300m+ EBITDA progression and longer‑term ambition toward EUR 600m).
Roofing Rollout Traction
Initial U.S. roofing build‑outs underway (Oklahoma, Maryland; potential Utah), with management guidance of U.S. roofing sales of approx. $150–200 million in 2027 and c.$300 million in 2028 and margins moving from single digits in 2027 toward group average by 2028.
Negative Updates
FX Headwinds
Foreign exchange movements reduced reported sales by ~EUR 138 million year‑on‑year and shaved ~EUR 21.4 million from profit (EUR 19.6 million in H2). Management cites an estimated EUR 17–18 million FX headwind for 2026 at current spot rates, concentrated in H1.
Working Capital and Cash Flow Timing
Working capital outflow of EUR 151 million; working capital to sales ratio rose to 11.9% (up 50 basis points from 11.4% at Dec‑24), about half the movement driven by acquisition timing—impacting short‑term cash conversion.
Weather Disruption and Q1 Softness
Weather hampered start to the year, affecting dispatches and deliveries and creating a softer Q1 trading profile with expectation of recovery in March/April.
Inflationary Pressure on Key Inputs
Management flagged rising input inflation, particularly steel (larger impact than chemicals/MDI), which is expected to continue quarter‑by‑quarter in 2026 and introduces short‑term margin timing risks despite pass‑through pricing strategy.
Headline Trading Margin Slightly Down
Headline trading margin fell 10 basis points to 10.4%; underlying pre‑acquisition margin was up 20 basis points to 10.7% (mixed picture between headline and underlying performance).
Board Business Capacity Rationalization
Boards business in Europe described as overpopulated: multiple smaller plants being exited or idled and capacity being concentrated in Winterswijk (Netherlands). This indicates prior overcapacity and near‑term restructuring/repurposing activity.
Roofing Near‑term Margin and Ramp Risks
U.S. roofing is a new market entry: expected single‑digit trading margins in 2027 and limited P&L contribution in 2026 as plants ramp, meaning investment and start‑up costs may depress near‑term returns.
Order Book Not Fully Bankable
While backlogs and intake are strong, management noted many commitments are not purchase orders and thus are not fully bankable, introducing execution/timing uncertainty beyond stated visibility.
Company Guidance
Management guided to around 10% earnings growth in 2026 and reconfirmed prior trading profit guidance of c. €1,050m, with Advances EBITDA at least €300m this year and a longer‑term target of c. €600m over 4–5 years; they expect capex of €350m (vs €325m in 2025) and an effective tax rate of 16.5%. At current spot FX they see a c. €17–18m headwind to 2026 while prior acquisitions annualise to ~€13m; operational momentum entering the year includes insulated panel order bank +8% and panels intake +8% in the first six weeks, Advances revenue +12% in 2025 with backlog +24% and order intake double year‑on‑year in the first six weeks, although weather may soften Q1 before recovery from March. Balance sheet metrics highlighted: 2025 free cash flow €429m, net debt €1.88bn (net debt/EBITDA 1.65x), ~€600m cash, €800m undrawn green RCF and gross debt ~€2.2bn; roofing build‑out is expected to deliver US sales of $150–200m in 2027 and c. $300m in 2028 with roofing margins in single digits in 2027, moving to group averages by 2028.Kingspan Group Financial Statement Overview
Summary
Good overall fundamentals: solid profitability (2025 gross margin ~29.1%, net margin ~7.3%) and manageable leverage, but tempered by a slight 2025 revenue decline (-1.35%), gradually rising debt-to-equity (~0.64), and weaker cash conversion (operating cash flow ~33% of net income).Income Statement
Profitability is solid and fairly stable, with 2025 gross margin ~29.1% and net margin ~7.3% (EBITDA margin ~13.2%). Revenue growth has been volatile: strong expansion in 2021–2022, modest growth in 2024, then a slight decline in 2025 (annual revenue growth -1.35%), which also coincided with a modest step-down in net income versus 2024. Overall, the business shows consistent earnings power, but the recent top-line soft patch is a near-term watch item.74
Positive
Balance Sheet
Leverage looks manageable but has trended higher in recent years, with debt-to-equity at ~0.64 in 2025 (up from ~0.56 in 2023). Equity has grown alongside assets (2025 equity ~4.48B vs. ~2.35B in 2020), supporting balance-sheet resilience. Returns remain healthy (2025 return on equity ~14.4%), though down from the higher levels seen in 2021–2023, suggesting profitability has normalized while leverage has inched up.70
Positive
Cash Flow
Cash generation is positive (2025 operating cash flow ~804M; free cash flow ~454M) and free cash flow rebounded in 2025 (+12.6% growth). However, cash conversion is a key weakness: operating cash flow covers only ~33% of net income in 2025 (down from ~61% in 2023), and free cash flow is ~56% of net income—both indicating more earnings tied up in working capital/investment needs versus prior years. Cash flow remains adequate, but quality and consistency have softened recently.62
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 8.84B | 8.61B | 8.09B | 8.34B | 6.50B |
| Gross Profit | 2.57B | 2.55B | 2.34B | 2.22B | 1.86B |
| EBITDA | 1.17B | 1.18B | 1.09B | 983.50M | 893.10M |
| Net Income | 644.71M | 665.50M | 640.30M | 598.00M | 554.10M |
Balance Sheet | |||||
| Total Assets | 9.82B | 9.82B | 8.00B | 7.68B | 6.39B |
| Cash, Cash Equivalents and Short-Term Investments | 584.45M | 1.01B | 938.70M | 649.30M | 641.40M |
| Total Debt | 2.85B | 2.82B | 2.14B | 2.39B | 1.56B |
| Total Liabilities | 5.09B | 5.23B | 4.05B | 4.29B | 3.43B |
| Stockholders Equity | 4.48B | 4.29B | 3.85B | 3.32B | 2.89B |
Cash Flow | |||||
| Free Cash Flow | 453.56M | 527.80M | 924.50M | 422.80M | 160.40M |
| Operating Cash Flow | 804.25M | 894.50M | 1.16B | 692.00M | 329.20M |
| Investing Cash Flow | -602.45M | -1.11B | -458.30M | -1.30B | -708.70M |
| Financing Cash Flow | -548.08M | 254.60M | -416.30M | 630.80M | -351.70M |
Kingspan Group Technical Analysis
Negative
83.12
Price Trends
90.06
Negative
86.08
Negative
84.44
Negative
Market Momentum
-1.79
Positive
36.77
Neutral
2.46
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KGSPY, the sentiment is Negative. The current price of 83.12 is below the 20-day moving average (MA) of 92.75, below the 50-day MA of 90.06, and below the 200-day MA of 84.44, indicating a bearish trend. The MACD of -1.79 indicates Positive momentum. The RSI at 36.77 is Neutral, neither overbought nor oversold. The STOCH value of 2.46 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KGSPY.
Kingspan Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $14.10B | 18.48 | 36.69% | 1.28% | 0.14% | 3.88% | |
76 Outperform | $10.89B | 30.06 | 25.82% | 0.47% | 2.48% | -6.92% | |
71 Outperform | $15.01B | 21.11 | 15.47% | 0.60% | 10.21% | 8.80% | |
64 Neutral | $12.57B | 16.37 | -537.31% | 1.94% | -3.62% | 3.41% | |
64 Neutral | $8.76B | -17.89 | -11.39% | 2.43% | 3.47% | -148.53% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
52 Neutral | $10.03B | 90.31 | 10.11% | ― | -6.44% | -48.84% |
* Industrials Sector Average
KGSPY
Kingspan Group
83.32
-6.11
-6.83%
BLDR
Builders Firstsource
90.68
-37.04
-29.00%
CSL
Carlisle Companies
344.87
8.53
2.53%
MAS
Masco
61.75
-7.62
-10.98%
OC
Owens Corning
108.95
-32.42
-22.93%
WMS
Advanced Drainage Systems
139.85
30.52
27.91%
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.