GMS (GMS) Stock Forecast & Price Target

GMS Inc. is demonstrating resilience in its revenue streams, particularly within its core wallboard and steel studs segments, which benefit from stable pricing amidst non-reconstruction strength in end markets. Complementary product lines also exhibit growth of 5%, indicating solid demand across the company's diverse geographic segments. Moreover, projections suggest gradual improvements in commercial demand and stability in single-family trends, alongside expectations of modest sequential gross margin improvements as past disruptions abate and pricing strategies stabilize.

GMS Inc. is facing a negative outlook due to a decline in gross margin, which fell by 20 basis points to 31.2%, matching its lowest level since fiscal 2015 and failing to meet the expected range. The company's projected FY'25 EBITDA is expected to decrease by 9% to $496 million following disappointing performance in the third quarter and a weak guidance for the fourth quarter, while year-over-year sales remained flat and also fell short of expectations. Furthermore, the forecast for EBITDA percentage has been revised down to 9.0%, reflecting a significant 210 basis point year-over-year drop, with limited near-term catalysts for improvement in performance anticipated.