Jefferies has revised its price target for Masco Corporation (MAS, Financial), adjusting it from $64 to $62 while maintaining a Hold rating on the stock. The financial services company acknowledged Masco's adept handling of anticipated tariff effects, which is expected to stabilize earnings by 2025. Despite this strategic management, Jefferies suggests that the current valuation of Masco’s shares appears appropriate, recommending investors wait for more favorable purchasing opportunities.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 18 analysts, the average target price for Masco Corp (MAS, Financial) is $78.68 with a high estimate of $92.00 and a low estimate of $60.00. The average target implies an upside of 32.64% from the current price of $59.32. More detailed estimate data can be found on the Masco Corp (MAS) Forecast page.
Based on the consensus recommendation from 24 brokerage firms, Masco Corp's (MAS, Financial) average brokerage recommendation is currently 2.5, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Masco Corp (MAS, Financial) in one year is $58.04, suggesting a downside of 2.16% from the current price of $59.32. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Masco Corp (MAS) Summary page.
Key Business Developments
Release Date: February 11, 2025
- Fourth Quarter Revenue: Decreased 3%, but increased 1% excluding divestiture and currency impacts.
- Fourth Quarter Operating Profit: Increased $19 million, with a margin improvement of 140 basis points to 15.9%.
- Fourth Quarter Earnings Per Share (EPS): Increased 7% to $0.89 per share.
- Plumbing Segment Operating Profit: $200 million, with a margin of 16.8%, up 40 basis points.
- Decorative Architectural Segment Operating Profit: $113 million, with a margin of 17.7%, up 290 basis points.
- Full Year Gross Margin: Improved 110 basis points to 36.3%.
- Full Year Operating Margin: Expanded 70 basis points to 17.5%.
- Full Year EPS: Grew 6% to $4.10 per share.
- Return on Invested Capital: 44%.
- Cash Returned to Shareholders: Over $1 billion through dividends and share repurchases.
- 2025 Sales Outlook: Expected to be down low single digits, but flat to up low single digits excluding divestiture and currency impacts.
- 2025 Operating Margin Outlook: Expected to expand to approximately 18%.
- 2025 EPS Estimate: $4.20 to $4.45 per share.
- 2025 Dividend Increase: 7% increase to $1.24 per share.
- 2025 Share Repurchases/Acquisitions: Approximately $600 million planned.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Masco Corp (MAS, Financial) introduced several innovative products in 2024, including water filtration products and a smart monitoring system for spas.
- The company completed the sale of Kichler Lighting, which is expected to streamline its portfolio and drive greater shareholder value.
- Masco Corp (MAS) achieved a 7% increase in earnings per share in the fourth quarter, marking the seventh consecutive quarter of year-over-year margin expansion.
- The company returned over $1 billion to shareholders in 2024 through dividends and share repurchases.
- Masco Corp (MAS) has a strong innovation pipeline, maintaining a vitality index of around 30% for products less than 36 months old.
Negative Points
- Fourth-quarter sales decreased by 3%, primarily due to the divestiture of Kichler Lighting.
- Plumbing sales decreased by 1% in local currency, with lower volumes in North America.
- The Decorative Architectural segment saw a 6% decrease in sales, largely due to the Kichler divestiture.
- The company anticipates a flat to down low single-digit market for global repair and remodel markets in 2025.
- Masco Corp (MAS) faces potential challenges from recently enacted China tariffs, which could impact costs despite mitigation efforts.
