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MasterBrand Inc (MBC)
:MBC
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MasterBrand Inc
(NYSE:MBC)
Rating:58Neutral
Price Target:
$11.50
▲( 15.58% Upside)
MasterBrand Inc (MBC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.24B
Dividend YieldN/A
Average Volume (3M)1.17M
Price to Earnings (P/E)12.6
Beta (1Y)1.07
Revenue Growth1.30%
EPS Growth-44.70%
CountryUS
Employees13,000
SectorConsumer Cyclical
Sector Strength76
IndustryFurnishings, Fixtures & Appliances
Share Statistics
EPS (TTM)0.18
Shares Outstanding126,737,520
10 Day Avg. Volume1,238,599
30 Day Avg. Volume1,170,326
Financial Highlights & Ratios
PEG Ratio-0.91
Price to Book (P/B)1.29
Price to Sales (P/S)0.00
P/FCF Ratio7.92
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$15.00Price Target Upside50.75% Upside
Rating ConsensusHold
Number of Analyst Covering2
MasterBrand Inc Business Overview & Revenue Model
Company DescriptionMasterBrand Inc (MBC) is a leading manufacturer and distributor of residential cabinets in North America. The company operates within the home improvement sector, providing a wide range of cabinetry products that cater to various styles and preferences. MBC's core products include semi-custom and custom cabinets, which are used in kitchens, bathrooms, and other areas of the home.
How the Company Makes MoneyMasterBrand Inc makes money primarily through the sale of its cabinetry products to a diverse customer base that includes builders, dealers, and home improvement retailers. The company leverages a broad distribution network, which allows it to reach both professional contractors and individual consumers. Key revenue streams come from its comprehensive portfolio of cabinet brands, each targeting different market segments and price points, enabling MBC to capture a wide range of customers. Additionally, the company may engage in strategic partnerships with large home improvement chains to increase its market penetration and sales volume. The combination of product diversity, strategic distribution, and partnerships contributes significantly to MBC's earnings.
MasterBrand Inc Financial Statement Overview
Summary
MasterBrand Inc's financial statements reveal a company navigating through a mix of strengths and challenges. Operational efficiency and cash flow management are commendable, but declining revenue and profit margins raise concerns. Increasing leverage on the balance sheet necessitates careful monitoring.Income Statement
MasterBrand Inc shows a mixed performance in its income statement. The gross profit margin remains stable, indicating effective cost management. However, a declining net profit margin over the years highlights potential pressure on earnings. The revenue growth rate is inconsistent, showing a decline in recent periods, which is a concern for future profitability. The EBIT and EBITDA margins reflect operational efficiency, but recent contractions suggest potential challenges.72
Positive
Balance Sheet
The balance sheet of MasterBrand Inc presents a moderate financial position. The debt-to-equity ratio is rising, indicating increasing leverage, which could pose a risk if not managed carefully. However, the company maintains a relatively strong equity ratio, suggesting a good cushion against liabilities. Return on Equity (ROE) has seen fluctuations, reflecting inconsistent profitability relative to shareholder investments.68
Positive
Cash Flow
Cash flow metrics demonstrate robust operational cash generation, with a high operating cash flow to net income ratio. Despite a decline in free cash flow growth in recent periods, the company retains a healthy free cash flow to net income ratio, indicating efficient cash utilization. However, the significant variations in free cash flow growth rates signal potential volatility in cash management.75
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.70B | 2.73B | 3.28B | 2.86B | 2.47B | Gross Profit |
| 877.00M | 875.90M | 940.50M | 783.90M | 703.00M | EBIT |
| 235.70M | 306.30M | 287.10M | 234.30M | 196.00M | EBITDA |
| 319.60M | 368.20M | 356.00M | 313.40M | 273.70M | Net Income Common Stockholders |
| 125.90M | 182.00M | 155.40M | 182.60M | 145.70M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 120.60M | 148.70M | 101.10M | 141.40M | 154.30M | Total Assets |
| 2.93B | 2.38B | 2.53B | 3.00B | 2.71B | Total Debt |
| 1.08B | 770.20M | 1.03B | 63.20M | 40.60M | Net Debt |
| 961.70M | 621.50M | 932.50M | -78.20M | -113.70M | Total Liabilities |
| 1.64B | 1.19B | 1.52B | 551.10M | 498.20M | Stockholders Equity |
| 1.29B | 1.19B | 1.01B | 2.45B | 2.21B |
| Cash Flow | Free Cash Flow | |||
| 211.10M | 348.30M | 179.70M | 96.60M | 177.30M | Operating Cash Flow |
| 292.00M | 405.60M | 235.60M | 148.20M | 204.60M | Investing Cash Flow |
| -580.80M | -56.90M | -55.90M | -51.50M | -26.70M | Financing Cash Flow |
| 269.60M | -299.90M | -215.30M | -109.70M | -179.20M |
MasterBrand Inc Technical Analysis
Negative
9.95
Price Trends
11.98
Negative
13.78
Negative
15.31
Negative
Market Momentum
-0.52
Positive
34.49
Neutral
13.07
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MBC, the sentiment is Negative. The current price of 9.95 is below the 20-day moving average (MA) of 11.12, below the 50-day MA of 11.98, and below the 200-day MA of 15.31, indicating a bearish trend. The MACD of -0.52 indicates Positive momentum. The RSI at 34.49 is Neutral, neither overbought nor oversold. The STOCH value of 13.07 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MBC.
MasterBrand Inc Risk Analysis
MasterBrand Inc disclosed 42 risk factors in its most recent earnings report. MasterBrand Inc 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 1 New Risks
1.
We may not be successful in identifying and executing potential business development transactions, such as our acquisition of Supreme, or realizing the financial and strategic goals that were contemplated at the time of any historical or potential business development transaction, which could have an adverse impact on our ability to meet our growth objectives. Q4, 2024
MasterBrand Inc Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $1.74B | 14.45 | 12.40% | 1.99% | 1.81% | 8.09% | |
68 Neutral | $2.28B | 9.58 | 24.52% | 1.93% | 1.59% | 43.91% | |
62 Neutral | $1.38B | 17.90 | -20.16% | 4.33% | -2.77% | 4.01% | |
62 Neutral | $6.84B | 11.22 | 2.83% | 3.93% | 2.65% | -21.93% | |
58 Neutral | $1.24B | 12.60 | 8.02% | ― | 1.30% | -44.70% | |
54 Neutral | $1.46B | 27.99 | 2.79% | 2.96% | 1.46% | -95.70% | |
52 Neutral | $1.10B | 38.36 | 2.28% | 4.53% | -2.68% | -56.16% |
* Consumer Cyclical Sector Average
Performance Comparison
MBC
MasterBrand Inc
9.80
-6.45
-39.69%
MLKN
MillerKnoll
16.29
-9.79
-37.54%
LZB
La-Z-Boy Incorporated
41.98
6.84
19.46%
PZZA
Papa John's International
42.25
-3.35
-7.35%
SAH
Sonic Automotive
67.14
11.77
21.26%
SPB
Spectrum Brands Holdings
58.11
-32.78
-36.07%
MasterBrand Inc Earnings Call Summary
Earnings Call Date:May 06, 2025
(Q1-2025)
| % Change Since: -16.94%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Negative
The earnings call highlighted some positive developments such as revenue growth from acquisitions and strategic initiatives, but these were overshadowed by significant challenges including market volume declines, reduced EBITDA margins, negative free cash flow, and increased SG&A expenses. The overall economic uncertainty and weaker market demand expectations further contribute to a negative outlook.Q1-2025 Updates
Positive Updates
Revenue Growth
Net sales increased by 3% to $660 million in the first quarter compared to the same period last year, driven by a 10% growth from the Supreme acquisition and a 2% growth from net ASP increases in the legacy business.
Builder Direct Sales Increase
Despite year-over-year declines in the new construction market, builder direct sales increased by over 4% compared to the prior year.
Strategic Initiatives Progress
The company's strategic initiatives, such as Align to Grow, Lead Through Lean, and Tech Enabled, are progressing well, with 97% of frontline supervisors completing the True Leader program.
New Facility Consolidations
Facility consolidations in North Carolina and Nevada are underway, expected to reduce costs and improve service, with financial benefits anticipated in the third quarter.
Negative Updates
Market Volume Declines
Market volume declined by 9% in the base business, particularly affecting customers servicing the repair and remodel market.
Adjusted EBITDA Margin Decline
Adjusted EBITDA margin decreased by 220 basis points to 10.2%, from 12.4% in the same period last year.
Negative Free Cash Flow
The company reported negative free cash flow of $41 million in the first quarter, compared to positive $12 million in the same period last year.
Weaker Market Demand Expectations
Market demand is expected to be down high to mid-single digits for 2025, with specific challenges in the US single-family new construction market and the repair and remodel market.
Net Income Decline
Net income was $13.3 million in the first quarter, a significant decline from $37.5 million in the same period last year.
Increased SG&A Expenses
Selling, general, and administrative expenses were up 11.8% compared to the same period last year, driven by Supreme-related items and increased spending on digital and technology initiatives.
Interest Expense Increase
Interest expense increased to $19.4 million in the first quarter, compared to $14.1 million in the same period last year due to debt for the Supreme acquisition.
Company Guidance
During the recent earnings call, MasterBrand provided guidance for the fiscal year 2025, highlighting several key metrics and expectations. The company reported first-quarter net sales of $660 million, marking a 3% increase year-over-year, driven by a 10% growth from the Supreme acquisition and a 2% increase from net ASP in the legacy business. Despite this, a 9% decline in market volume within the base business was noted. Adjusted EBITDA was $67 million with a margin of 10.2%, reflecting a contraction due to lower volumes and fixed cost leverage challenges. The company experienced a negative free cash flow of $41 million in Q1, contrasting with a positive $12 million in the prior year, influenced by lower net income and higher inventory levels. For the full year 2025, MasterBrand adjusted its market demand expectations to be down high to mid-single-digits, with an anticipated low single-digit decline in annual net sales. The company also adjusted its EBITDA guidance to a range of $315 million to $365 million with margins between 12% and 13.5%, citing the impact of tariffs and general economic uncertainty as influencing factors.MasterBrand Inc Corporate Events
Business Operations and StrategyFinancial Disclosures
MasterBrand Inc Reports Q1 2025 Financial Results
Negative
May 6, 2025
On May 6, 2025, MasterBrand, Inc. announced its first quarter financial results, revealing a 3% increase in net sales to $660.3 million, but a significant 65% decline in net income to $13.3 million compared to the previous year. The company attributed the weaker-than-expected demand to a slow start in the Spring selling season, impacting margins and necessitating adjustments in production and facility consolidations. Despite these challenges, MasterBrand remains optimistic about maintaining competitive EBITDA margins through cost reductions and strategic investments. The company also updated its 2025 financial outlook, anticipating a slight decrease in net sales but expecting to outperform the market with new products and channel-specific offerings.
Stock Buyback
MasterBrand Inc Announces New $50 Million Share Buyback
Positive
Mar 17, 2025
On March 17, 2025, MasterBrand, Inc. announced a new share repurchase program authorized by its Board of Directors, allowing the company to buy back up to $50 million of its outstanding common stock until March 13, 2028. This initiative is in addition to an existing repurchase authorization from April 2023, with $21 million remaining for repurchases as of December 29, 2024. The repurchase program aims to enhance shareholder value by leveraging MasterBrand’s strong cash flow to strengthen its balance sheet and invest in the business. The company can repurchase shares through various methods, and the program may be adjusted based on business and market conditions.
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.