TopBuild (BLD) Stock Forecast & Price Target

TopBuild Corp reported 4Q sales of $602 million for its installation segment, exceeding expectations of $571 million and reflecting a 7% year-over-year increase. The company's revenue for the full year reached $1,312 million, marking a 2% year-over-year growth, driven largely by acquisitions and a favorable pricing environment, which increased by approximately 1.5%. Additionally, TopBuild demonstrated robust operational efficiency, with adjusted EBITDA growing by 8% year-over-year, resulting in an EBITDA margin of 17.7%, a notable improvement compared to the prior year.

TopBuild Corp is facing a negative financial outlook primarily due to projected declines in key segments, with anticipated EBITDA margins dropping to 19.2%—a 100 basis point decrease compared to the previous year's results. The company is contending with weak multi-family construction, which has seen double-digit declines and negatively impacts revenue, particularly as the multi-family backlog continues to diminish. Overall market expectations suggest low single-digit growth in commercial and industrial sectors, juxtaposed with mid single-digit declines in the residential sector, which collectively places additional pressure on the company’s financial performance moving into 2025.