HNI (HNI) Stock Forecast & Price Target

HNI Corp's Workplace Furnishings segment is projected to experience a low-single-digit improvement in the second half of 2024, supported by a growing sales funnel and the potential for increased market share, ultimately contributing to the company achieving record full-year EPS. The company's positive outlook is bolstered by estimated earnings per share (EPS) growth to $3.10 for the current year and $3.40 for the next, driven by significant cost savings and operational improvements, particularly from KII synergies and Mexico facility savings. With industry indicators signaling growth and expectations of improved year-over-year sales in both Workplace Furnishings and Residential Building Products, HNI Corp is well-positioned for margin expansion and enhanced profitability moving forward.

HNI Corp has recently experienced a significant decline in net sales, reporting a decrease of 17.4%, influenced by adverse weather conditions and shifting interest rate expectations that negatively impacted the new construction market. Despite management's guidance suggesting that year-over-year revenue declines may begin to ease, the anticipated growth has been pushed to the second half of the year, indicating ongoing challenges in consumer sentiment that affect both new construction and repair/remodeling activities. Furthermore, although the stock has potential upside relative to historical earnings peaks, it currently trades approximately 25% below levels seen during previous economic cycles, suggesting that current market conditions may not support a recovery in stock valuation in the near term.