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Mohawk (MHK)
NYSE:MHK
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Mohawk
(NYSE:MHK)
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Rating:67Neutral
Price Target:
$129.00
▲(12.09% Upside)
Action:ReiteratedDate:02/14/26
The score is driven primarily by a solid financial foundation (strong free cash flow and manageable/improving leverage) but capped by only partial profitability recovery and margin pressure. Technically, shares show strong upside momentum above major moving averages, though near-term momentum looks stretched. Valuation is moderate with a ~20 P/E and no dividend yield provided, while the latest earnings call adds a mixed outlook: cost/productivity actions and guidance support improvement, but demand, pricing, and tariff/input-cost risks remain key overhangs.
Positive Factors
Strong free cash flow and conversion
Consistent, high free cash flow in 2025 with FCF roughly equal to operating cash flow and tracking net income demonstrates durable cash conversion. This strengthens financial flexibility for restructuring, targeted capex, buybacks, and debt repayment across cycles, supporting long-term strategic actions.
Improving, manageable leverage
A materially lower debt-to-equity ratio and sizable equity base indicate a healthier capital structure. Manageable leverage provides headroom to fund investments or weather demand downturns, reduces financial risk, and supports continued disciplined capital allocation over the medium term.
Segment-level strength & product innovation
Concrete growth and margin improvement in Global Ceramic and active launches (premium collections, quartz line, advanced printing) show durable structural advantages: diversified product portfolio and innovation that gain share in commercial channels, helping offset residential cyclicality over time.
Negative Factors
Stagnant top-line growth
Flat revenue across the latest year indicates limited organic demand traction. Sustained top-line stagnation constrains scalable margin expansion and heightens reliance on cost cuts or share buybacks for EPS growth, making earnings recovery contingent on macro/housing improvements.
Persistent margin pressure from input and tariff costs
Material and ongoing input-cost and tariff headwinds compress gross and operating margins. Where pricing is constrained by competition and housing weakness, productivity gains may only partially offset these structural cost pressures, leaving sustained margin volatility and execution risk.
Elevated inventories & underinvestment risk
High inventory days create working-capital strain if demand recovery lags and increase risk of write-downs; concurrently running capex materially below depreciation conserves cash but risks underinvestment in capacity or innovation if markets rebound, a structural tradeoff for medium-term growth.
Mohawk (MHK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$6.99B
Dividend YieldN/A
Average Volume (3M)765.41K
Price to Earnings (P/E)18.3
Beta (1Y)0.94
Revenue Growth-0.82%
EPS Growth-23.99%
CountryUS
Employees41,900
SectorConsumer Cyclical
Sector Strength84
IndustryFurnishings, Fixtures & Appliances
Share Statistics
EPS (TTM)2.00
Shares Outstanding61,460,358
10 Day Avg. Volume706,273
30 Day Avg. Volume765,414
Financial Highlights & Ratios
PEG Ratio-0.68
Price to Book (P/B)0.81
Price to Sales (P/S)0.63
P/FCF Ratio11.02
Enterprise Value/Market Cap1.29
Enterprise Value/Revenue0.84
Enterprise Value/Gross Profit3.45
Enterprise Value/Ebitda7.92
Forecast
1Y Price Target
$140.40Price Target Upside21.99% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)9.62
Revenue Forecast (FY)$11.05B
Mohawk Business Overview & Revenue Model
Company DescriptionMohawk Industries, Inc. designs, manufactures, sources, distributes, and markets flooring products for remodeling and new constructions of residential and commercial spaces in the United States, Europe, Russia, and internationally. It operates through three segments: Global Ceramic, Flooring North America (Flooring NA), and Flooring Rest of the World (Flooring ROW). The Global Ceramic segment provides a range of ceramic tile, porcelain tile, and natural stone products; and sources, markets, and distributes other tile related products. This segment markets and distributes its products under the American Olean, Daltile, Eliane, EmilGroup, KAI, Kerama Marazzi, Marazzi, and Ragno brands. The Flooring NA segment offers floor covering product lines in a range of colors, textures, and patterns, including carpets, carpet tiles, rugs and mats, carpet pads, hardwood, laminate, medium-density fiberboards, luxury vinyl tiles (LVT), and sheet vinyl products. This segment markets and distributes its flooring products under the Aladdin Commercial, Durkan, IVC, Karastan, Mohawk, Mohawk Group, Mohawk Home, Pergo, Portico, and Quick-Step brands. The Flooring ROW segment provides wood flooring and vinyl flooring, as well as laminates, roofing elements, sheet vinyl, LVT, insulation boards, medium-density fiberboards, chipboards, and other woods products under the Feltex, Godfrey Hirst, Hycraft, IVC Commercial, IVC Home, Leoline, Moduleo, Pergo, Quick-Step, and Unilin and Xtratherm brands; and licenses its intellectual property to flooring manufacturers. Mohawk Industries, Inc. was incorporated in 1988 and is headquartered in Calhoun, Georgia.
How the Company Makes MoneyMohawk generates revenue primarily through the sale of its flooring products across various segments. The company’s revenue model is based on manufacturing and distributing a wide array of flooring solutions, which are sold through a network of retailers, distributors, and directly to contractors and builders. Key revenue streams include residential flooring sales, commercial flooring solutions, and sales from its ceramic tile segment. Additionally, Mohawk benefits from significant partnerships with home improvement retailers and large construction firms, which enhance its market reach. The company's commitment to innovation, sustainability, and expanding its product offerings also contributes to its earnings by attracting a broader customer base and responding to market trends.
Mohawk Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyMohawk Earnings Call Summary
Earnings Call Date:Feb 12, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 23, 2026
Earnings Call Sentiment Neutral
The call presents a mixed picture: operational and financial strengths (strong free cash flow, disciplined balance sheet, segment-level wins in Global Ceramic, ongoing productivity and restructuring savings, and active tariff mitigation) partially offset persistent top-line and margin pressures from weak residential end markets, elevated input costs, tariffs, nonrecurring charges and pricing competition. Management expects 2026 to be a transitional year with modest volume recovery and improved earnings driven by pricing, mix and productivity, but results remain dependent on macro and housing-market inflection.Q4-2025 Updates
Positive Updates
Q4 Net Sales and Reported Growth
Q4 net sales of approximately $2.7 billion, up 2.4% as reported versus prior year (approximately down 3.3% on a constant currency basis); performance in line with expectations.
Q4 Adjusted Earnings Per Share
Q4 adjusted EPS of $2.00, up ~3% year-over-year, driven by productivity, restructuring initiatives, improved product mix and lower interest expense.
Full-Year Revenue Stability
Full-year sales were approximately $10.8 billion, essentially flat versus prior year (reported).
Strong Free Cash Flow and Conservative Leverage
Generated full-year free cash flow of approximately $620 million (Q4 free cash flow ~$270 million); cash and equivalents $806 million; gross debt $2.0 billion and leverage ~0.9x adjusted EBITDA.
Share Repurchases
Repurchased approximately 1.3 million shares for $149 million during the year under the existing buyback authorization.
Segment Strength — Global Ceramic
Global Ceramic sales just under $1.1 billion, +6.1% as reported and ~flat on a constant basis; adjusted operating income $63 million (5.9% margin), up ~60 basis points year-over-year due to $22M productivity and $16M price/mix benefits.
Productivity and Restructuring Benefits
Delivered approximately $115 million of cumulative restructuring savings in 2025; expected carryover of ~$60+ million of restructuring benefit into 2026, plus additional productivity actions implemented (quarterly productivity benefits cited at ~$41–51 million).
Tariff and Supply-Chain Management
Managed U.S. tariff costs through pricing actions and supply-chain optimization; company expects to cover tariff-related costs through combined actions (management cited an annualized impact previously described around ~$100 million and active mitigation).
Capital Allocation Discipline and 2026 Investment Plan
Reduced 2025 CapEx to $435 million (about 30% below depreciation levels) to match market conditions; planning approximately $480 million of capital investment in 2026 focused on product innovation, cost reduction and maintenance.
Product Innovation and Commercial Momentum
Launched premium product collections, ramping new quartz production line and introducing advanced printing and hybrid (PVC-free) offerings; commercial channel outperformed residential with strength in health care, education and hospitality.
Negative Updates
Full-Year Adjusted EPS Decline
Full-year adjusted EPS of $8.96, down approximately 7.5% year-over-year, reflecting volume weakness and higher input costs despite productivity and pricing actions.
Prolonged Industry Weakness — Housing and Remodeling
Industry context remains weak: housing turnover at historical lows, sluggish new home construction and nearly four-year industry recession that continues to suppress remodeling and discretionary spend.
Flooring North America Headwinds
Flooring North America sales of $893 million, down 4.8% as reported (down 6.2% constant); operating income $39 million (4.4% margin), a 130 basis-point decline driven by lower volume, increased input costs (+$70 million) and higher shutdown costs (+$12 million).
Flooring — Rest of World Volume and Margin Pressure
Flooring Rest of World sales $737 million (up 6.5% reported but down ~3.5% on a constant basis); adjusted operating margin pressure with a ~120 basis-point decline, driven by weakened price/mix (~$15 million) and lower volumes in residential remodeling.
Rising Input Costs and Tariff Headwinds
Multiple input cost increases cited across segments (examples: +$22M, +$32M, +$70M in various categories); tariffs remain a material cost headwind—management referenced an aggregate multi-year impact in the order of ~$100 million that they are attempting to offset.
Nonrecurring Charges and Legal/Restructuring Costs
Q4 nonrecurring charges of $84 million (primarily restructuring actions and legal settlements) reduced reported operating income to $68 million (2.5%).
Elevated Inventory Levels
Inventories ended the year just shy of $2.7 billion with inventory days at 139, reflecting channel dynamics and FX impacts—potential working capital pressure if demand recovery lags.
Reduced 2025 Capital Spending vs. Depreciation
2025 CapEx was reduced to ~$435 million—about 30% below depreciation—which mitigates near-term cash outflow but could imply underinvestment risk if market recovery accelerates unexpectedly.
Geographic and Segment-Specific Challenges
Europe: pricing weakened due to excess capacity and competition; Latin America: soft demand and aggressive competitor pricing; Brazil: high benchmark interest rates (~15%) compressing the market.
Near-Term Demand Uncertainty and Competitive Pricing Pressure
Q1 seasonality is slow and early 2026 market conditions are tracking similar to Q4; some announced price increases have been postponed due to competitive dynamics, creating execution risk for margin recovery.
Company Guidance
Management guided first‑quarter adjusted EPS of $1.75–$1.85 (ex‑one‑time items), a full‑year 2026 non‑GAAP tax rate of 18.5%–19.5%, planned CapEx of about $480 million with depreciation & amortization of ~$626 million, and corporate expense of $52–$55 million; they said they expect to generate strong free cash flow (2025 was ~$620 million, Q4 ~$270 million), enter 2026 with gross debt of ~$2.0 billion and leverage of 0.9x adjusted EBITDA, and to cover tariff costs (management cited an approximately $100 million annualized impact) via pricing, mix and supply‑chain actions; management expects carry‑over restructuring savings of roughly $60+ million (with ~$30 million of additional Q4 actions largely flowing to 2027), anticipates some industry volume improvement in 2026 and that product mix, productivity and cost reductions will offset energy, labor and other inflationary headwinds, and noted Q1 seasonality includes four extra shipping days year‑over‑year (one extra sequential day).Mohawk Financial Statement Overview
Summary
Financials show a recovery but not a full normalization: strong and improving free cash flow supports the profile, and leverage is manageable with improving debt-to-equity. Offsetting this, revenue has been flat and profitability/returns remain below prior-cycle levels with signs of margin pressure versus 2024.Income Statement
Revenue has been relatively flat over the last two years (2025: $10.79B vs. 2024: $10.84B), following declines in 2022–2024. Profitability recovered from the 2023 loss, with 2025 returning to a 3.4% net margin, but this is still well below stronger prior periods (2021: 9.2%). Margins also stepped down in 2025 versus 2024 across gross and operating levels, suggesting ongoing pricing/cost pressure and a less favorable earnings mix.56
Neutral
Balance Sheet
Leverage looks manageable for the industry, with debt-to-equity improving to ~0.33 in 2025 from ~0.41 in 2023, indicating a healthier capital structure. Equity is sizable ($8.38B in 2025) relative to debt ($2.76B), providing balance-sheet flexibility. The main weakness is that returns on equity remain modest (about 4.4% in 2025) versus the company’s stronger historical level (2021: ~12.3%), reflecting a still-recovering earnings profile.68
Positive
Cash Flow
Cash generation is a key strength: 2025 operating cash flow was $1.06B and free cash flow also $1.06B, exceeding 2024 free cash flow ($680M). Free cash flow also tracked net income well in 2025 (about 1.0x), indicating good earnings quality and conversion. A softer point is that operating cash flow relative to revenue remains in the mid-single digits (about 9.8% in 2025), and cash flow has been somewhat volatile across the cycle (notably weaker free cash flow in 2022).74
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 10.79B | 10.84B | 11.14B | 11.74B | 11.20B |
| Gross Profit | 2.57B | 2.69B | 2.71B | 2.94B | 3.27B |
| EBITDA | 1.14B | 1.33B | 353.30M | 831.30M | 1.94B |
| Net Income | 369.90M | 517.70M | -439.52M | 25.25M | 1.03B |
Balance Sheet | |||||
| Total Assets | 13.69B | 12.78B | 13.56B | 14.12B | 14.22B |
| Cash, Cash Equivalents and Short-Term Investments | 856.10M | 666.60M | 642.60M | 667.62M | 591.89M |
| Total Debt | 2.76B | 2.63B | 3.15B | 3.22B | 2.73B |
| Total Liabilities | 5.31B | 5.22B | 5.93B | 6.10B | 5.80B |
| Stockholders Equity | 8.38B | 7.55B | 7.62B | 8.01B | 8.42B |
Cash Flow | |||||
| Free Cash Flow | 616.20M | 679.50M | 710.71M | 88.41M | 633.00M |
| Operating Cash Flow | 1.06B | 1.13B | 1.32B | 669.15M | 1.31B |
| Investing Cash Flow | -441.90M | -454.40M | -970.34M | -625.34M | -556.75M |
| Financing Cash Flow | -470.00M | -629.50M | -205.09M | 194.35M | -1.23B |
Mohawk Technical Analysis
Negative
115.09
Price Trends
120.67
Negative
117.63
Negative
117.57
Negative
Market Momentum
-0.58
Positive
32.47
Neutral
18.34
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MHK, the sentiment is Negative. The current price of 115.09 is below the 20-day moving average (MA) of 128.13, below the 50-day MA of 120.67, and below the 200-day MA of 117.57, indicating a bearish trend. The MACD of -0.58 indicates Positive momentum. The RSI at 32.47 is Neutral, neither overbought nor oversold. The STOCH value of 18.34 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MHK.
Mohawk Risk Analysis
Mohawk disclosed 26 risk factors in its most recent earnings report. Mohawk reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Mohawk Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $1.68B | 14.41 | 20.55% | 0.21% | 5.11% | 34.02% | |
67 Neutral | $6.99B | 18.35 | 4.65% | ― | -0.82% | -23.99% | |
65 Neutral | $1.45B | 18.08 | 8.11% | 2.39% | 1.78% | -25.36% | |
62 Neutral | $4.08B | 26.08 | 10.49% | 1.49% | 6.08% | -22.18% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
53 Neutral | $1.25B | 53.13 | 6.19% | ― | 1.77% | -44.11% | |
47 Neutral | $3.41B | 9.33 | 11.76% | 7.40% | -11.36% | -133.01% |
* Consumer Cyclical Sector Average
MHK
Mohawk
115.09
-1.92
-1.64%
TILE
Interface
29.00
10.40
55.88%
LZB
La-Z-Boy Incorporated
35.78
-5.31
-12.93%
PATK
Patrick Industries
121.03
35.74
41.90%
WHR
Whirlpool
59.95
-26.58
-30.72%
MBC
MasterBrand Inc
9.59
-3.78
-28.27%
Mohawk Corporate Events
Executive/Board Changes
Mohawk Names Paul De Cock Interim Global Flooring President
Neutral
Feb 6, 2026
On February 5, 2026, Mohawk Industries appointed Chief Operating Officer Paul De Cock as interim President of its Flooring Rest of World segment, following the resignation of Wim Messiaen from that role on the same date to pursue other interests. De Cock, 52, brings extensive experience within Mohawk’s global flooring operations, having previously led the Flooring North America segment and earlier serving as President of Flooring in the Rest of World segment and in senior roles at Unilin prior to its acquisition, and the company stated there will be no material changes to his compensation in connection with this interim appointment.
The most recent analyst rating on (MHK) stock is a Hold with a $131.00 price target. To see the full list of analyst forecasts on Mohawk stock, see the MHK Stock Forecast page.
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.