Education
About Us
Working with TipRanks
Follow Us
Interface (TILE)
NASDAQ:TILE
Top Page
Interface
(NASDAQ:TILE)
66Neutral
Positive Factors
Earnings
Adjusted EBITDA and adjusted EPS topped expectations, indicating strong earnings performance.
Financial Performance
Net sales increased 10.7% to $344.3 million, exceeding estimates and management's guidance, driven by lower raw material costs and higher fixed cost absorption.
Stock Valuation
Interface's stock is trading at a discount to its peer group, which presents an attractive valuation.
Negative Factors
Foreign Exchange Impact
Revenue was below expectations, due primarily to adverse FX.
Revenue
Revenue was below expectations due primarily to adverse FX.
Interface (TILE) vs. S&P 500 (SPY)
Market Cap
$1.15B
Dividend Yield0.2%
Average Volume (3M)675.15K
Price to Earnings (P/E)13.4
Beta (1Y)1.39
Revenue Growth4.29%
EPS Growth95.04%
CountryUS
Employees3,636
SectorIndustrials
Sector Strength65
IndustryFurnishings, Fixtures & Appliances
Share Statistics
EPS (TTM)1.47
Shares Outstanding58,313,040
10 Day Avg. Volume649,726
30 Day Avg. Volume675,146
Financial Highlights & Ratios
PEG Ratio0.14
Price to Book (P/B)N/A
Price to Sales (P/S)0.87
Price to Cash Flow (P/CF)7.60
P/FCF Ratio6.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$30.00Price Target Upside50.98% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
Interface Business Overview & Revenue Model
Company DescriptionInterface, Inc., a modular flooring company, designs, produces, and sells modular carpet products primarily in the Americas, Europe, and the Asia-Pacific. The company offers modular carpets under the Interface and FLOR brand names; carpet tiles under the GlasBacRE name for use in commercial interiors, including offices, healthcare facilities, airports, educational and other institutions, hospitality spaces, and retail facilities, as well as residential interiors; modular resilient flooring products; rubber flooring under the norament and noraplan brand names; and luxury vinyl tile products. It also produces and sells an adapted version of its carpet tile for the healthcare facilities market; and two-meter roll goods that are structure-backed for use in education, healthcare, and government markets, as well as carpet replacement, installation, and maintenance services. In addition, the company sells and licenses a proprietary antimicrobial chemical compound under the Intersept name for use in interior finishes; sells TacTiles, a carpet tile installation system, as well as various adhesives and products; and provides turnkey project management services for global accounts and other customers through its InterfaceSERVICES business. It sells its products directly to end-users, as well as indirectly through independent contractors or distributors, and FLOR line of products through Internet sales and commercial sales force. The company has product showrooms or design studios in the United States, Canada, Mexico, England, France, Germany, Spain, the Netherlands, India, Australia, Norway, the United Arab Emirates, Russia, Singapore, Hong Kong, Thailand, China, and others. Interface, Inc. was incorporated in 1973 and is headquartered in Atlanta, Georgia.
How the Company Makes MoneyInterface, Inc. generates revenue through the sale of its modular carpet tiles and other flooring solutions. The company's revenue streams are primarily driven by direct sales to commercial clients, as well as through partnerships with architects, designers, and flooring contractors. Interface also invests in research and development to produce innovative and sustainable products, which helps maintain its competitive edge and appeal to environmentally conscious customers. Significant factors contributing to earnings include its strong brand reputation, global distribution network, and focus on sustainable practices, which align with the increasing demand for eco-friendly products in the commercial interiors market.
Interface Financial Statement Overview
Summary
Interface has strong revenue growth and cash flow generation, with a 4.29% increase in revenue and robust cash flow ratios. However, the high debt-to-equity ratio poses a significant risk, and operational margins have room for improvement.Income Statement
Interface has demonstrated consistent revenue growth, with the latest annual revenue increasing from $1.26 billion to $1.32 billion, yielding a revenue growth rate of 4.29%. The gross profit margin is healthy at 36.7%, and the net profit margin has improved to 6.61% over the previous year. However, the EBITDA margin remained constant at 10.21%, suggesting room for operational efficiency improvements.75
Positive
Balance Sheet
The debt-to-equity ratio is high, indicating significant leverage, which may pose risks in volatile market conditions. The stockholders' equity is not present for the latest period, limiting complete assessment. However, previous data indicates a declining equity ratio, suggesting increasing reliance on debt.65
Positive
Cash Flow
Operating cash flow increased from $142 million to $148 million, and the free cash flow remained stable, indicating strong cash generation abilities. The operating cash flow to net income ratio is robust, enhancing liquidity and operational flexibility.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Mar 2023 | Mar 2022 | Mar 2021 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.32B | 1.26B | 1.30B | 1.20B | 1.10B | Gross Profit |
| 482.95M | 441.07M | 437.73M | 432.73M | 410.57M | EBIT |
| 134.41M | 104.52M | 109.99M | 104.80M | 66.46M | EBITDA |
| 134.41M | 140.41M | 114.41M | 149.43M | -6.09M | Net Income Common Stockholders |
| 86.95M | 44.52M | 19.56M | 55.23M | -71.93M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 99.23M | 110.50M | 97.56M | 97.25M | 103.05M | Total Assets |
| 1.17B | 1.23B | 1.27B | 1.33B | 1.31B | Total Debt |
| 305.56M | 515.45M | 604.38M | 610.55M | 676.59M | Net Debt |
| 305.56M | 404.95M | 506.81M | 513.30M | 573.54M | Total Liabilities |
| 681.67M | 804.15M | 904.97M | 966.66M | 979.47M | Stockholders Equity |
| 489.15M | 425.95M | 361.54M | 363.40M | 326.54M |
| Cash Flow | Free Cash Flow | |||
| 114.64M | 115.93M | 24.62M | 58.62M | 56.12M | Operating Cash Flow |
| 148.43M | 142.03M | 43.06M | 86.69M | 119.07M | Investing Cash Flow |
| -30.37M | -19.51M | -18.44M | -28.07M | -61.69M | Financing Cash Flow |
| -125.23M | -111.56M | -19.49M | -60.86M | -42.72M |
Interface Technical Analysis
Negative
19.87
Price Trends
21.35
Negative
23.23
Negative
20.30
Negative
Market Momentum
-0.25
Negative
46.61
Neutral
46.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TILE, the sentiment is Negative. The current price of 19.87 is above the 20-day moving average (MA) of 19.41, below the 50-day MA of 21.35, and below the 200-day MA of 20.30, indicating a neutral trend. The MACD of -0.25 indicates Negative momentum. The RSI at 46.61 is Neutral, neither overbought nor oversold. The STOCH value of 46.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TILE.
Interface Risk Analysis
Interface disclosed 9 risk factors in its most recent earnings report. Interface reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Interface Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $6.12B | 23.40 | 39.28% | 0.81% | 11.62% | 20.76% | |
70 Outperform | $7.26B | 18.54 | 26.98% | 1.99% | 4.02% | 42.77% | |
66 Neutral | $1.15B | 13.45 | 18.90% | 0.20% | 4.29% | 95.04% | |
66 Neutral | $7.12B | 14.04 | 6.82% | ― | -2.68% | ― | |
62 Neutral | $8.05B | 13.60 | 4.04% | 3.11% | 3.70% | -14.19% | |
60 Neutral | $1.07B | ― | -50.58% | 7.71% | -7.27% | -272.76% | |
60 Neutral | $14.56B | 18.30 | -118.61% | 1.70% | -1.74% | -6.91% |
* Industrials Sector Average
Performance Comparison
TILE
Interface
19.87
3.40
20.64%
AWI
Armstrong World
141.64
22.31
18.70%
LEG
Leggett & Platt
7.86
-10.22
-56.53%
MAS
Masco
69.84
-6.14
-8.08%
MHK
Mohawk
115.01
-10.12
-8.09%
TTC
The Toro Company
72.57
-12.73
-14.92%
Interface Earnings Call Summary
Earnings Call Date: Feb 25, 2025 | % Change Since: -6.71% | Next Earnings Date: May 2, 2025
Earnings Call Sentiment Positive
Interface demonstrated a strong financial performance with significant growth in the Americas and operational improvements through automation investments. However, challenges in the EAAA region and the Corporate Office segment were noted. The company's commitment to sustainability and successful debt reduction were additional positives.Highlights
Successful Implementation of One Interface Strategy
The integrated selling approach combining Nora and Interface teams in the US led to double-digit order growth in the Americas region year-over-year.
Operational Efficiency Improvements
Investments in automation and robotics at manufacturing plants in the US and Germany improved margins and operational efficiency.
Strong Financial Performance
Currency-neutral net sales grew by 4% year-over-year, nearly doubling GAAP earnings per diluted share. The Americas saw a 9% increase in currency-neutral net sales.
Recognition in Sustainability
Interface received top honor in Reuters 2024 Sustainability awards in the Net Zero Leadership category for its shift from offsets and commitment to carbon negative goals.
Increased Liquidity and Debt Reduction
Generated $148.4 million in cash from operating activities and repaid $115.2 million of debt, reducing the net leverage ratio to 1.1x.
Lowlights
Decline in EAAA Region Sales
Currency-neutral net sales in the EAAA region were down 2% for the year, with a 5.2% decline in the fourth quarter due to a softer macro environment.
Challenges in Corporate Office Segment
Global billings in the Corporate Office segment were down 1% for the year, though this was favorable compared to the overall industry.
Decrease in Fourth Quarter Gross Profit Margin
Fourth quarter adjusted gross profit margin decreased by 139 basis points from the prior year due to lower adjusted gross profit margin, higher sales commissions, and variable compensation.
Company Guidance
The guidance provided in the Interface, Inc. earnings call for the fourth quarter of 2024 highlights several key metrics and strategic initiatives. The company reported a 4% increase in currency-neutral net sales for the year, with a notable 9% increase in the Americas region. The One Interface strategy, which combines Nora and Interface selling teams, resulted in double-digit order growth in the Americas. The company also focused on expanding margins through global supply chain management, appointing a Chief Supply Chain Officer 18 months ago to optimize operations and drive productivity improvements. This resulted in a significant increase in operational efficiencies, particularly due to investments in automation and robotics in key manufacturing plants. For the fiscal year 2024, Interface achieved nearly doubled GAAP earnings per diluted share, with an adjusted gross profit margin of 37.1%, up 173 basis points from the previous year. Looking forward to 2025, Interface expects net sales of $1.315 billion to $1.365 billion, with a gross profit margin between 37.2% and 37.4%. The company plans to invest approximately $45 million in capital expenditures, focusing on further automation and efficiency improvements, while closely monitoring macroeconomic conditions, particularly in the European and Australian markets.Interface Corporate Events
Business Operations and StrategyFinancial Disclosures
Interface Reports Strong Q4 2024 Financial Results
Positive
Feb 25, 2025
On February 25, 2025, Interface, Inc. reported its financial results for the fourth quarter and full fiscal year ending December 29, 2024. The company achieved a 4.3% increase in net sales year-over-year, reaching $1,316 million, and significantly improved its gross profit margin. The results reflect the success of the One Interface strategy, which has driven growth across all product categories, particularly in the Americas. Interface also made substantial progress in reducing debt and expanding its market share in key segments, despite a challenging macroeconomic environment.
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.