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Simpson Manufacturing (SSD)
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Simpson Manufacturing Co (SSD) AI Stock Analysis

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SSD

Simpson Manufacturing Co

(NYSE:SSD)

Rating:77Outperform
Price Target:
$214.00
▲(13.42% Upside)
Simpson Manufacturing Co's strong financial performance and positive technical indicators are the most significant factors contributing to the stock's score. The company's robust profitability and stable balance sheet provide a solid foundation. However, the relatively high valuation and market challenges, such as tariff impacts, slightly temper the overall outlook.
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. SPDR S&P 500 ETF (SPY)

Simpson Manufacturing Co Business Overview & Revenue Model

Company DescriptionSimpson 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 MoneySimpson Manufacturing generates revenue through the sale of its manufactured products, which include structural connectors, fastening systems, and related tools and equipment. The company's primary revenue streams come from the wood construction and concrete construction sectors, where they provide essential products for framing, anchoring, and reinforcing structures. Additionally, Simpson earns income from its international operations by exporting products to global markets. Partnerships with distributors, contractors, and construction firms enhance their market reach and drive sales. The company's focus on innovation leads to the development of new products that meet evolving industry standards, further contributing to its revenue growth.

Simpson Manufacturing Co Earnings Call Summary

Earnings Call Date:Jul 28, 2025
(Q2-2025)
|
% Change Since: 13.66%|
Next Earnings Date:Oct 27, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a balance between positive revenue growth, stable operating margins, and strategic expansions against challenges such as flat volumes, tariff impacts, and competitive pressures. While growth and operational stability are evident, market uncertainties and cost pressures remain significant considerations.
Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Net sales increased by 5.7% year-over-year to $631.1 million. North American net sales grew by 6.4% to $492.7 million, driven by price increases and acquisitions.
Operating Margin Stability
Operating margin remained stable at 22.2%, supported by disciplined cost management and targeted pricing strategies.
European Market Performance
European net sales increased by 2.7% despite local currency sales decline. Operating income in Europe rose by 29% due to reduced expenses and higher gross margins.
Expansion and Investment
Completed the expansion of the Columbus, Ohio facility on time and under budget. The Gallatin, Tennessee facility is on track for completion, aiding in domestic production of fasteners.
Customer and Product Line Expansion
Expanded customer base and product lines, particularly in digital solutions and component manufacturing, contributing to above-market growth.
Negative Updates
Flat Volume and Market Challenges
Volumes were relatively flat year-over-year, with challenges in the residential market impacting growth.
Gross Margin Pressures
Gross margin remained flat at 46.7% despite higher input and labor costs. Tariffs on imported goods have increased costs, affecting margins.
Tariff and Pricing Challenges
New tariffs on steel and related metals could prompt additional pricing actions, potentially impacting market competitiveness.
European Local Currency Sales Decline
Despite overall net sales growth in Europe, local currency sales declined by $2.8 million.
Company Guidance
In the second quarter of fiscal year 2025, Simpson Manufacturing Co. reported net sales of $631.1 million, reflecting a growth of 5.7% compared to the previous year, despite a challenging residential housing market. In North America, net sales increased by 6.4% to $492.7 million, supported by a $9 million contribution from 2024 acquisitions and partial benefits from price increases effective June 2. The company's volumes remained relatively flat, though North American volumes exceeded U.S. housing starts by approximately 240 basis points over the last 12 months. The OEM business experienced double-digit volume growth, while the commercial business saw mid-single-digit improvements, driven by strong performance in adhesive and cold-formed steel product lines. Simpson's operating margin remained flat at 22.2%, with consolidated adjusted EBITDA rising 4.8% to $159.9 million. The company reaffirmed its 2025 guidance, expecting an operating margin of 18.5% to 20.5%, influenced by revised expectations of U.S. housing starts declining in low single digits and potential gross margin pressure from tariffs. Simpson remains focused on maintaining market position and achieving above-market growth, supported by disciplined cost management and targeted pricing strategies.

Simpson Manufacturing Co Financial Statement Overview

Summary
Simpson Manufacturing Co demonstrates strong financial performance with consistent revenue growth and robust profitability margins. The balance sheet is well-capitalized with low leverage, providing financial stability. Despite some volatility in cash flow metrics, the company maintains positive free cash flow and liquidity.
Income Statement
85
Very Positive
Simpson Manufacturing Co has demonstrated strong performance in its income statement metrics. The company shows stable revenue growth with a Revenue Growth Rate of approximately 1.9% in the TTM compared to the previous year. The Gross Profit Margin stands at 46.1% for the TTM, indicating effective cost management. Net Profit Margin is at 14.5%, reflecting robust profitability. EBIT and EBITDA margins are healthy at 19.6% and 25.2% respectively. These margins highlight efficient operational management and profitability in the construction industry.
Balance Sheet
78
Positive
The balance sheet of Simpson Manufacturing Co reflects a solid financial position with a strong equity base. The Debt-to-Equity Ratio has improved significantly to 0.03 in the TTM from 0.27 the previous year, indicating lower financial leverage and reduced reliance on debt. The Return on Equity (ROE) for the TTM is 13.7%, showcasing efficient use of equity in generating profits. The Equity Ratio is high at 81.4%, demonstrating a strong equity cushion and lower risk of insolvency. Overall, the company maintains financial stability with a well-capitalized balance sheet.
Cash Flow
72
Positive
Simpson Manufacturing Co exhibits a stable cash flow position. The Free Cash Flow Growth Rate shows a decrease of around 25% from the previous annual figure, but the company maintains positive free cash flow, which is a good sign of liquidity. The Operating Cash Flow to Net Income Ratio stands at 0.66, indicating that the company generates sufficient operating cash to cover its net income. The Free Cash Flow to Net Income Ratio is 0.36, reflecting adequate cash flow generation relative to profitability. These metrics suggest a healthy cash flow position, despite some fluctuations in growth.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.27B2.23B2.21B2.12B1.57B1.27B
Gross Profit1.05B1.03B1.04B941.17M754.71M575.52M
EBITDA571.01M520.74M558.69M532.95M411.44M297.60M
Net Income330.40M322.22M353.99M334.00M266.45M187.00M
Balance Sheet
Total Assets2.96B2.74B2.70B2.50B1.48B1.23B
Cash, Cash Equivalents and Short-Term Investments190.40M239.37M429.82M300.74M301.15M274.64M
Total Debt457.50M480.66M551.57M635.47M45.86M46.34M
Total Liabilities1.02B923.03M1.02B1.09B300.13M251.63M
Stockholders Equity1.93B1.81B1.68B1.41B1.18B980.94M
Cash Flow
Free Cash Flow118.34M157.80M338.20M337.46M101.70M169.66M
Operating Cash Flow219.07M338.16M427.02M399.82M151.29M207.57M
Investing Cash Flow-163.57M-259.26M-103.25M-870.24M-58.80M-39.85M
Financing Cash Flow-168.35M-261.46M-199.03M465.53M-71.62M-126.78M

Simpson Manufacturing Co Technical Analysis

Technical Analysis Sentiment
Positive
Last Price188.68
Price Trends
50DMA
168.98
Positive
100DMA
161.66
Positive
200DMA
166.00
Positive
Market Momentum
MACD
6.28
Positive
RSI
63.04
Neutral
STOCH
67.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SSD, the sentiment is Positive. The current price of 188.68 is above the 20-day moving average (MA) of 183.26, above the 50-day MA of 168.98, and above the 200-day MA of 166.00, indicating a bullish trend. The MACD of 6.28 indicates Positive momentum. The RSI at 63.04 is Neutral, neither overbought nor oversold. The STOCH value of 67.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 (44)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
77
Outperform
$7.99B24.4417.88%0.60%2.95%0.76%
70
Outperform
$7.19B18.8316.84%1.70%-5.79%-9.90%
69
Neutral
$6.87B35.5619.81%-9.65%-28.30%
68
Neutral
$6.86B23.2417.53%1.19%-1.44%-31.12%
44
Neutral
AU$1.54B-7.44-18.84%4.47%-3.00%-40.37%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SSD
Simpson Manufacturing Co
188.68
3.77
2.04%
FBIN
Fortune Brands Innovations
57.48
-22.94
-28.53%
LPX
Louisiana-Pacific
92.43
-3.70
-3.85%
TREX
Trex Company
61.34
-6.19
-9.17%

Simpson Manufacturing Co Corporate Events

Stock BuybackFinancial Disclosures
Simpson Manufacturing Co Reports Q2 2025 Financial Results
Positive
Jul 28, 2025

On July 28, 2025, Simpson Manufacturing Co., Inc. announced its financial results for the second quarter of 2025, reporting a 5.7% increase in net sales year-over-year to $631.1 million and a 6.1% rise in income from operations to $140.2 million. The company also reported a 6.9% increase in net income per diluted share to $2.47 and repurchased $35.0 million of common stock during the quarter. Despite challenges in the housing market, the company achieved an operating income margin of 22.2% and experienced sales growth in North America and Europe, supported by acquisitions and favorable currency translation.

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.Date of analysis: Aug 19, 2025