DA Davidson lowers Builders FirstSource stock price target on demand pressures

Published 04/08/2025, 20:40
DA Davidson lowers Builders FirstSource stock price target on demand pressures

Investing.com - DA Davidson has lowered its price target on Builders FirstSource (NYSE:BLDR) to $125.00 from $135.00 while maintaining a Neutral rating on the stock. The building products company, currently valued at $14.27 billion, has seen analyst targets range from $128 to $158, with InvestingPro data showing 7 analysts recently revising earnings estimates downward.

The adjustment follows Builders FirstSource’s second-quarter 2025 results released last week, which showed resilient gross margin performance of 31.58% despite a 6.39% year-over-year revenue decline and broader market challenges.

DA Davidson noted that while the results demonstrated "meaningful lasting GM improvements" compared to pre-Covid levels, the company also issued a significant downward revision to its full-year EBITDA guidance.

The research firm specifically highlighted "persistent core single-family demand pressures" as a key concern affecting overall profitability forecasts for the building materials supplier.

Builders FirstSource shares have traded modestly higher since the earnings report, with the market apparently viewing the strong gross margin performance as partially offsetting concerns about the reduced annual outlook.

In other recent news, Builders FirstSource reported its Q2 2025 earnings, revealing a mixed financial performance. The company achieved an earnings per share (EPS) of $2.38, surpassing the forecasted $2.25. However, it fell short on revenue, reporting $4.23 billion compared to the expected $4.27 billion. This revenue miss was noted as a significant development for investors. Additionally, Barclays (LON:BARC) has adjusted its price target for Builders FirstSource to $135, down from $137, while maintaining an Overweight rating. The adjustment was attributed to cyclical volume pressure impacting the building materials supplier. These developments are crucial for investors to consider when evaluating the company’s financial health and market position.

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