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Investing.com - Jefferies raised its price target on JELD-WEN (NYSE:JELD) to $5.25 from $3.75 while maintaining a Hold rating on the stock, citing improved productivity in the second quarter. The company, currently trading at $5.73, has shown strong returns over the last three months despite its market cap dropping to $486 million. According to InvestingPro analysis, the stock is currently trading near its Fair Value.
The investment firm noted that JELD-WEN management has taken action with facility closures and headcount reductions to counter sharp volume declines. Potential asset sales could help bring the company’s leverage to more manageable levels, according to Jefferies. This is particularly crucial given the company’s debt-to-equity ratio of 2.88 and total debt of $1.37 billion, which InvestingPro data indicates is a significant burden.
JELD-WEN faced ongoing cost pressure from labor and material inflation in the second quarter, resulting in a negative price/cost impact of $6 million. The company experienced less headwind from variable compensation due to lower headcount from its mitigation efforts.
Jefferies reported that JELD-WEN is seeing increased pricing competition from smaller competitors but expects surcharges to offset tariffs. For 2025, the company anticipates tariffs to be approximately a $17 million headwind, down from a previous estimate of $30 million.
The price/cost relationship is expected to remain negative in 2025, though the rate of decline should moderate in the second half of the year, with pricing anticipated to increase in the third and fourth quarters due to surcharges. While analysts expect the company to return to profitability this year, InvestingPro subscribers can access 12 additional key insights about JELD-WEN’s financial health and future prospects through the comprehensive Pro Research Report.
In other recent news, Jeld-Wen Holding Inc. reported its second-quarter 2025 earnings, revealing a smaller-than-expected loss and a slight revenue beat. The company posted an earnings per share (EPS) of -$0.04, which was better than the forecasted -$0.07. Additionally, Jeld-Wen reported revenue of $823.7 million, exceeding the predicted $810.15 million. These results have been met with investor optimism, as reflected in the stock’s movement following the announcement. While the company faces ongoing challenges, the earnings report suggests a positive response from the market. The financial results highlight the company’s ability to perform better than analyst expectations, contributing to a favorable outlook from investors.
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