Simpson Manufacturing Co (SSD) AI Stock Analysis

• Market Cap: $7.37B
• Dividend Yield: 0.69%
• Average Volume (3M): 254.14K
• Price to Earnings (P/E): 29.7
• Beta (1Y): 0.83
• Revenue Growth: 4.26%
• EPS Growth: 8.52%
• Country: US
• Employees: 5,872
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Construction
• EPS (TTM): 1.35
• Shares Outstanding: 41,402,035
• 10 Day Avg. Volume: 255,989
• 30 Day Avg. Volume: 254,138
• PEG Ratio: 2.37
• Price to Book (P/B): 3.32
• Price to Sales (P/S): 2.89
• P/FCF Ratio: 22.79
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 3.24
• Enterprise Value/Gross Profit: 7.06
• Enterprise Value/Ebitda: 13.68
• 1Y Price Target: $207.33
• Price Target Upside: 16.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 8.72
• Revenue Forecast (FY): $2.40B

• Rating: 71 Outperform
• Price Target: $214.00 ▲(20.25% Upside)
• Action: Reiterated Date: 02/28/26
• Date: Action: Reiterated 02/28/26

SSD scores well on fundamentals, led by strong profitability and scale with manageable leverage, but is held back by margin compression and inconsistent free-cash-flow conversion. The earnings call supports a steady outlook with buybacks and cost actions, though tariffs and housing-start sensitivity remain key risks. Technically, the longer-term trend is positive but near-term momentum is mixed, and valuation looks only moderate given the low dividend yield.

Positive Factors

High profitability and margins

Sustained gross margins in the mid-to-high 40s and ~20% EBIT margin indicate durable cost structure and pricing power across core connector and fastening products. This level of profitability supports reinvestment, shareholder returns, and resilience through cyclical construction downturns.

Scale and multi-year revenue growth

Material revenue expansion over several years reflects successful scaling, broader product adoption, and distribution penetration. Larger scale reinforces manufacturing efficiency, bargaining power with suppliers, and capacity to fund innovation and digital offerings that can sustain above-market growth.

Strong cash generation and capital returns

Consistent operating cash flow and meaningful free cash flow enable active capital allocation: regular dividends, sizable buybacks, and targeted acquisitions. This cash generation underpins shareholder returns while funding strategic investments without immediate reliance on new equity.

Negative Factors

Tariff-driven cost pressure

Persistent tariff costs that offset pricing gains create a structural margin headwind. If tariffs or input-cost volatility persist, gross margin upside is constrained, forcing reliance on cost cuts or product mix shifts to preserve operating profit over multiple quarters.

Sensitivity to housing starts and volume risk

Revenue and volume remain tied to cyclical residential construction activity. Flattish or declining U.S. housing starts can persistently cap organic growth and create regional earnings variability, limiting visibility for sustained top-line expansion absent further diversification.

Uneven free cash flow conversion and margin compression

Persistent gap between net income and free cash flow reduces financial flexibility despite reported profits. Combined with multi-year margin compression versus peak levels, this pattern raises concern that earnings are more volatile and less convertable into durable, distributable cash.

Simpson Manufacturing Co Business Overview & Revenue Model

Company Description

Simpson Manufacturing Co., Inc., through its subsidiaries, designs, engineers, manufactures, and sells wood and concrete construction products. The company offers wood construction products, including connectors, truss plates, fastening systems, fasteners and shearwalls, and pre-fabricated lateral systems for use in light-frame construction; and concrete construction products comprising adhesives, specialty chemicals, mechanical anchors, carbide drill bits, powder actuated tools, fiber-reinforced materials, and other repair products for use in concrete, masonry, and steel construction, as well as grouts, coatings, sealers, mortars, fiberglass and fiber-reinforced polymer systems, and asphalt products for use in concrete construction repair, and strengthening and protection products. It also provides connectors and lateral products for wood framing, timber and offsite construction, structural steel construction, and cold-formed steel applications; and mechanical and adhesive anchors for concrete and masonry construction applications. In addition, the company offers engineering and design services, as well as software solutions that facilitate the specification, selection, and use of its products. It markets its products to the residential construction, light industrial and commercial construction, remodeling, and do-it-yourself markets in the United States, Canada, France, the United Kingdom, Germany, Denmark, Switzerland, Portugal, Poland, the Netherlands, Belgium, Spain, Sweden, Norway, Australia, New Zealand, China, Taiwan, and Vietnam. The company was founded in 1956 and is headquartered in Pleasanton, California.

How the Company Makes Money

Simpson Manufacturing Co generates revenue primarily through the sale of its product offerings, which include a diverse range of structural connectors, fasteners, and other building materials. The company’s revenue model is driven by direct sales to builders, contractors, and distributors, as well as through retail partnerships. Key revenue streams include sales of engineered wood products and fastening systems, which are essential for residential and commercial construction projects. Additionally, Simpson benefits from strong brand recognition and relationships with building supply distributors, which facilitate broader market access. Seasonal fluctuations in construction activity can impact earnings, but ongoing investment in product innovation and expansion into new markets contribute positively to revenue stability.

Simpson Manufacturing Co Financial Statement Overview

Summary

Strong multi-year revenue growth and healthy profitability (gross margin mid-to-high 40s; ~20% EBIT margin in 2025). Balance sheet leverage is manageable and improving versus 2022, with attractive ROE. Offsetting these positives are post-2023 margin compression and uneven free-cash-flow conversion/volatility (FCF consistently below net income).

Income Statement

Revenue has grown strongly over the period (from ~$1.27B in 2020 to ~$2.33B in 2025), with generally healthy profitability. Gross margin remains solid in the mid-to-high 40% range, while operating profitability is strong for the industry (EBIT margin ~20% in 2025). The main weakness is that margins have compressed versus the 2021–2023 peak (net margin down from ~17% in 2021 to ~14.8% in 2025), suggesting some cost or pricing pressure despite continued scale growth.

Balance Sheet

The balance sheet looks fundamentally sound with equity growth and improving leverage versus the 2022 peak (debt-to-equity ~0.28 in 2025 vs ~0.45 in 2022). Returns on equity remain attractive (roughly 17–24% over the period), indicating good capital efficiency. The key watch-out is that total debt is meaningfully higher than 2020–2021 levels, and while leverage is currently manageable, the step-up in borrowing reduces flexibility relative to the earlier, very low-debt profile.

Cash Flow

Cash generation is solid, with operating cash flow strengthening to ~$459M in 2025 and free cash flow rebounding to ~$298M. However, cash conversion is uneven: free cash flow is less than net income in every year shown (about ~65% of net income in 2025), and free cash flow was notably weaker in 2024 before recovering in 2025. Overall, the business produces real cash but shows some volatility in how effectively profits turn into free cash flow.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.33B	2.23B	2.21B	2.12B	1.57B
Gross Profit	1.07B	1.03B	1.04B	941.17M	754.71M
EBITDA	550.95M	520.74M	558.69M	532.95M	411.44M
Net Income	345.08M	322.22M	353.99M	334.00M	266.45M
Balance Sheet
Total Assets	3.07B	2.74B	2.70B	2.50B	1.48B
Cash, Cash Equivalents and Short-Term Investments	384.14M	239.37M	429.82M	300.74M	301.15M
Total Debt	487.58M	480.66M	551.57M	635.47M	45.86M
Total Liabilities	1.04B	923.03M	1.02B	1.09B	300.13M
Stockholders Equity	2.03B	1.81B	1.68B	1.41B	1.18B
Cash Flow
Free Cash Flow	295.63M	157.80M	338.20M	337.46M	101.70M
Operating Cash Flow	456.67M	338.16M	427.02M	399.82M	151.29M
Investing Cash Flow	-136.35M	-259.26M	-103.25M	-870.24M	-58.80M
Financing Cash Flow	-183.98M	-261.46M	-199.03M	465.53M	-71.62M

Simpson Manufacturing Co Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 177.96
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSD, the sentiment is Negative. The current price of 177.96 is below the 20-day moving average (MA) of 192.19, below the 50-day MA of 186.82, and above the 200-day MA of 174.87, indicating a neutral trend. The MACD of -2.76 indicates Positive momentum. The RSI at 31.77 is Neutral, neither overbought nor oversold. The STOCH value of 12.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SSD.

Simpson Manufacturing Co Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WMS	76 Outperform	$10.69B	30.06	25.82%	0.47%	2.48%	-6.92%
AWI	72 Outperform	$7.17B	31.80	36.09%	0.66%	15.10%	23.35%
SSD	71 Outperform	$7.37B	29.69	17.58%	0.69%	4.26%	8.52%
OC	64 Neutral	$8.56B	―	-11.39%	2.43%	3.47%	-148.53%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
AAON	58 Neutral	$6.84B	57.78	12.63%	0.53%	8.77%	-47.50%
FBIN	51 Neutral	$5.18B	20.84	12.70%	1.91%	-3.78%	-24.77%

Simpson Manufacturing Co Corporate Events

Simpson Manufacturing Posts Solid 2025 Results, Raises Shareholder Returns

On February 9, 2026, Simpson Manufacturing Co., Inc. reported that fourth-quarter 2025 net sales rose 4.2% year over year to $539.3 million, with net income per diluted share of $1.35 and a declared quarterly dividend of $0.29 per share. For full-year 2025, the company posted 4.5% net sales growth to $2.33 billion, operating income of $458.1 million with a 19.6% margin, net income of $345.1 million or $8.24 per diluted share, and repurchased $120 million of its stock, signaling continued profitability and shareholder returns despite a challenging housing market.

Management highlighted that 2025 revenue growth was driven by roughly 3% pricing, 1% acquisitions and 1% foreign exchange, partially offset by a 1% volume decline, underscoring the company’s ability to manage margins through pricing and cost discipline. The results and capital allocation actions, including dividends and buybacks, reinforce Simpson’s solid positioning in the building products sector even as the company awaits updated U.S. housing starts data that will further clarify the demand backdrop.

The most recent analyst rating on (SSD) stock is a Hold with a $203.00 price target. To see the full list of analyst forecasts on Simpson Manufacturing Co stock, see the SSD Stock Forecast page.

Simpson Manufacturing Secures New Five-Year Credit Facilities

On December 16, 2025, Simpson Manufacturing Co., Inc. entered into a Second Amended and Restated Credit Agreement that replaces its March 30, 2022 facility and establishes a five-year $600 million revolving credit facility and a five-year $300 million term loan. The term loan was used at closing to refinance existing indebtedness and pay related fees, while the revolving facility will fund permitted acquisitions, investments, and ongoing working capital needs, with the company retaining the option to upsize the combined facilities by the greater of $525 million and 100% of its most recently reported consolidated EBITDA, subject to additional lender commitments and customary conditions. Pricing on the facilities is tied to Simpson’s net leverage ratio, with varying margins over base rates such as SOFR and other benchmark rates, and the agreement imposes customary affirmative and negative covenants, including limits on additional indebtedness, liens, investments, acquisitions, dividends and affiliate transactions, as well as financial maintenance tests requiring a maximum consolidated net leverage ratio of 3.50x (with a temporary step-up after qualifying acquisitions) and a minimum interest coverage ratio of 2.50x. The package of covenants and default provisions, which allows lenders to terminate commitments and accelerate obligations upon specified events, is designed to balance lender protections with Simpson’s financial flexibility, supporting its acquisition strategy and operational liquidity while constraining leverage and risk for creditors.

The most recent analyst rating on (SSD) stock is a Buy with a $187.00 price target. To see the full list of analyst forecasts on Simpson Manufacturing Co stock, see the SSD Stock Forecast page.