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Simpson Manufacturing Co Inc (SSD)
NYSE:SSD
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Simpson Manufacturing Co
(NYSE:SSD)
73Outperform
Positive Factors
Business Model
SSD's long-term prospects remain strong, behind a high-quality business model, share gains, and balance sheet.
Investments
SSD leaned into investments in 2024, positive for longer-term share gain opportunities.
Negative Factors
Financial Performance
Q3 operating margin was 21.3%, below the Street's 22.6% expectation.
Simpson Manufacturing Co (SSD) vs. S&P 500 (SPY)
Market Cap
$6.45B
Dividend Yield0.72%
Average Volume (3M)292.76K
Price to Earnings (P/E)20.0
Beta (1Y)1.16
Revenue Growth1.38%
EPS Growth-3.80%
CountryUS
Employees5,872
SectorBasic Materials
Sector Strength64
IndustryConstruction
Share Statistics
EPS (TTM)7.68
Shares Outstanding41,974,438
10 Day Avg. Volume221,351
30 Day Avg. Volume292,762
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.07
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit6.74
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$182.00Price Target Upside18.31% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
Simpson Manufacturing Co Business Overview & Revenue Model
Company DescriptionSimpson Manufacturing Co. (SSD) is a leading global provider in the construction sector, specializing in the design, engineering, and manufacturing of wood and concrete construction products. The company is renowned for its innovative structural connectors, anchors, and fasteners, which are essential for building safe and sustainable structures. With a strong presence in both residential and commercial construction markets, Simpson Manufacturing Co. delivers high-quality solutions that enhance the structural integrity and performance of buildings worldwide.
How the Company Makes MoneySimpson Manufacturing Co. primarily generates revenue through the sale of its comprehensive range of construction products, including connectors, anchors, and fasteners. These products are sold directly to construction companies, contractors, and distributors who supply the building and construction industry. The company's revenue model is driven by the continuous demand for durable and reliable construction solutions, particularly in the residential and commercial construction sectors. Additionally, Simpson Manufacturing Co. invests in research and development to innovate and expand its product offerings, which helps in sustaining its competitive edge and boosting sales. Strategic partnerships with distributors and an extensive sales network further contribute to the company's ability to reach a wide customer base and maintain robust revenue streams.
Simpson Manufacturing Co Financial Statement Overview
Summary
Simpson Manufacturing Co's financial performance is strong, with consistent revenue growth, robust profitability margins, a stable balance sheet with low leverage, and efficient cash flow management. These factors indicate a well-managed, financially stable company poised for future growth.Income Statement
Simpson Manufacturing Co has demonstrated strong income statement performance with consistent revenue growth and robust profitability margins. The TTM revenue growth rate is approximately 1.8%, indicating steady expansion. Gross and net profit margins remain healthy at 46.1% and 14.5% respectively. EBIT and EBITDA margins are also solid at 19.5% and 23.5%, reflecting operational efficiency. Overall, the company exhibits strong revenue generation and profitability.85
Very Positive
Balance Sheet
The balance sheet of Simpson Manufacturing Co is stable, with a commendable equity ratio of 80.3%, indicating a strong equity base relative to total assets. The debt-to-equity ratio is low at 0.04, suggesting minimal leverage and financial risk. Return on equity is solid at 14.3%, demonstrating good profitability relative to shareholder investments. These metrics highlight a financially stable position with low leverage and efficient capital utilization.78
Positive
Cash Flow
Cash flow analysis reveals strong cash generation capabilities, with a free cash flow growth rate of 19.9% in the TTM period. The operating cash flow to net income ratio stands at 1.02, indicating efficient cash conversion from profits. The free cash flow to net income ratio of 0.58 shows a healthy level of free cash flow generation relative to earnings. This indicates robust cash flow management and the ability to sustain operations and growth.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.23B | 2.21B | 2.12B | 1.57B | 1.27B | Gross Profit |
| 1.03B | 1.04B | 941.29M | 755.03M | 576.38M | EBIT |
| 429.98M | 475.15M | 459.07M | 367.79M | 252.36M | EBITDA |
| 518.63M | 554.21M | 532.95M | 411.44M | 297.60M | Net Income Common Stockholders |
| 322.22M | 353.99M | 334.00M | 266.45M | 187.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 239.37M | 429.82M | 300.74M | 301.15M | 274.64M | Total Assets |
| 2.74B | 2.70B | 2.51B | 1.48B | 1.23B | Total Debt |
| 98.68M | 551.57M | 623.92M | 37.09M | 37.20M | Net Debt |
| -140.69M | 121.75M | 323.18M | -264.06M | -237.44M | Total Liabilities |
| 923.03M | 1.02B | 1.09B | 300.13M | 251.63M | Stockholders Equity |
| 1.81B | 1.68B | 1.42B | 1.18B | 980.94M |
| Cash Flow | Free Cash Flow | |||
| 157.80M | 338.20M | 332.60M | 101.70M | 169.66M | Operating Cash Flow |
| 338.16M | 427.02M | 399.82M | 151.29M | 207.57M | Investing Cash Flow |
| -259.26M | -103.25M | -870.24M | -58.80M | -39.85M | Financing Cash Flow |
| -261.46M | -199.03M | 465.53M | -71.62M | -126.78M |
Simpson Manufacturing Co Technical Analysis
Neutral
153.83
Price Trends
156.16
Negative
162.95
Negative
172.84
Negative
Market Momentum
-0.54
Negative
52.11
Neutral
66.29
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSD, the sentiment is Neutral. The current price of 153.83 is above the 20-day moving average (MA) of 149.22, below the 50-day MA of 156.16, and below the 200-day MA of 172.84, indicating a neutral trend. The MACD of -0.54 indicates Negative momentum. The RSI at 52.11 is Neutral, neither overbought nor oversold. The STOCH value of 66.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SSD.
Simpson Manufacturing Co Risk Analysis
Simpson Manufacturing Co disclosed 42 risk factors in its most recent earnings report. Simpson Manufacturing Co 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
Simpson Manufacturing Co Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $7.16B | 49.98 | 10.73% | ― | 6.59% | 30.00% | |
73 Outperform | $6.45B | 20.01 | 18.11% | 0.72% | 1.38% | -3.80% | |
73 Outperform | $6.22B | 27.82 | 28.90% | ― | 5.17% | 10.39% | |
72 Outperform | $7.72B | 25.25 | 16.54% | ― | 4.93% | ― | |
66 Neutral | $6.03B | 14.63 | 26.08% | 1.23% | 13.95% | 138.97% | |
59 Neutral | $6.29B | 13.82 | 20.02% | 1.80% | -0.37% | 18.78% | |
49 Neutral | $1.93B | -1.47 | -21.02% | 3.74% | 0.80% | -29.57% |
* Basic Materials Sector Average
Performance Comparison
SSD
Simpson Manufacturing Co
153.83
-26.03
-14.47%
BECN
Beacon Roofing Supply
124.17
28.28
29.49%
FBIN
Fortune Brands Innovations
53.31
-18.87
-26.14%
LPX
Louisiana-Pacific
86.52
13.02
17.71%
TREX
Trex Company
57.97
-34.04
-37.00%
AZEK
AZEK Company
49.77
3.25
6.99%
Simpson Manufacturing Co Earnings Call Summary
Earnings Call Date:Apr 28, 2025
(Q1-2025)
| % Change Since: 0.00%|
Next Earnings Date:Jul 28, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a balanced performance with strong growth in North America and strategic investments, offset by declines in European sales and challenges due to tariffs and cost increases. Despite these challenges, the company maintains a positive outlook for the year.Q1-2025 Updates
Positive Updates
North American Market Performance
Net sales in North America totaled $420.7 million, up 3.4% from $406.7 million last year, exceeding U.S. housing starts by approximately 420 basis points.
Growth in Outdoor Living Category
The outdoor living category experienced low-double-digit growth over the prior year, attributed to a growing product offering and intentional marketing efforts.
OEM and Commercial Market Growth
OEM delivered high-single-digit volume growth year-over-year, and the commercial market saw low-single-digit growth despite challenging conditions.
Improvement in Gross and Operating Margins
Consolidated gross margin improved to 46.8% from 46.1%, and operating margin expanded by 90 basis points to 19% over last year.
Strategic Investments and Facility Expansions
Investments in Columbus, Ohio, and Gallatin, Tennessee facilities are on budget and on time, with the new Gallatin facility expected to optimize fastener sourcing.
Negative Updates
Decline in European Sales
Net sales in Europe decreased 5.1% compared to the prior year, with foreign currency translation impacting results negatively.
Challenges in Component Manufacturing and Residential Volumes
Component manufacturing market volumes declined slightly, and Residential volume performance was down modestly.
Impact of Tariffs and Cost Increases
New tariffs and increased costs in labor, energy, and transportation are challenging, prompting an 8% price increase to offset some of these pressures.
Company Guidance
During the first quarter of 2025, Simpson Manufacturing reported net sales of $538.9 million, reflecting a modest growth of 1.6% year-over-year, despite a challenging macroeconomic environment. The North American segment saw a 3.4% increase in net sales to $420.7 million, while European sales experienced a 5.1% decline. The company exceeded U.S. housing starts by approximately 420 basis points in North America, with net sales of $420.7 million. Gross margin improved to 46.8%, up from 46.1% in Q1 2024, despite higher input costs. Operating margin expanded by 90 basis points to 19%, and adjusted EBITDA increased by 3.8% to $121.8 million. Simpson Manufacturing maintained its guidance, expecting operating margins between 18.5% and 20.5% for the year, with U.S. housing starts anticipated to remain flat-to-up in the low-single-digit range. The company also reaffirmed its commitment to returning at least 35% of free cash flow to shareholders.Simpson Manufacturing Co Corporate Events
Stock BuybackBusiness Operations and StrategyFinancial Disclosures
Simpson Manufacturing Co Reports Q1 2025 Financial Results
Positive
Apr 28, 2025
On April 28, 2025, Simpson Manufacturing Co., Inc. announced its financial results for the first quarter of 2025, highlighting a 1.6% year-over-year increase in net sales to $538.9 million and an operating income margin of 19.0%. The company also repurchased $25.0 million in common stock and reaffirmed its 2025 guidance. Despite a challenging macroeconomic environment, the company reported a $9.0 million benefit from its 2024 acquisitions and implemented price increases to offset rising costs, including those related to new tariffs.
Spark’s Take on SSD Stock
According to Spark, TipRanks’ AI Analyst, SSD is a Outperform.
Simpson Manufacturing Co’s stock receives an overall score of 71, reflecting its solid financial performance and reasonable valuation. The technical analysis indicates potential weakness, while the earnings call provides a balanced view with positive growth prospects offset by margin challenges. The company’s financial health is good, but improving cash flow management will be crucial moving forward.
To see Spark’s full report on SSD stock, click here.
DividendsBusiness Operations and StrategyFinancial Disclosures
Simpson Manufacturing Reports Modest Revenue Growth in 2024
Positive
Feb 10, 2025
Simpson Manufacturing Co., Inc. reported its financial results for the fourth quarter and full year of 2024, with net sales increasing by 0.8% to $2.2 billion compared to the previous year. Despite a challenging market environment with declining housing starts, the company managed modest revenue growth and maintained a strong operational focus, declaring a $0.28 per share dividend and providing a positive outlook for 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.