James Hardie (ASX:JHX) Is Down 33.1% After Sharp Q1 Earnings Miss Are Profits at Risk?

• James Hardie Industries plc reported first quarter earnings for the period ended June 30, 2025, showing sales of US$899.9 million and net income of US$62.6 million, both down from the previous year.
• This marked a significant year-on-year decrease in earnings, as both basic and diluted earnings per share fell to US$0.15 compared to US$0.36 a year earlier.
• Given the pronounced decline in both revenue and net income, we'll examine how this impacts James Hardie's medium-term investment outlook.

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James Hardie Industries Investment Narrative Recap

To be a shareholder in James Hardie Industries right now, you need to believe that the company's investments in capacity and product innovation will weather the current demand slowdown, supporting a return to growth as construction markets recover. The pronounced drop in sales and net income in Q1 2025 is a challenge, but does not materially change the central short-term catalyst: the anticipated benefit from capacity expansions. The most material risk remains margin pressure from higher raw material costs and a soft European market.

Among the company’s recent announcements, the acquisition of AZEK® stands out, bringing leadership changes and expanding its U.S. presence in residential building products. While this move aligns with James Hardie’s broader growth ambitions, it places further focus on integration execution and cost management, especially as market conditions remain uncertain. However, as investors consider this, they should also be aware of...

Read the full narrative on James Hardie Industries (it's free!)

James Hardie Industries is projected to reach $6.8 billion in revenue and $971.3 million in earnings by 2028. This outlook requires 20.8% annual revenue growth and a $547.3 million increase in earnings from the current $424.0 million level.

Uncover how James Hardie Industries' forecasts yield a A$36.16 fair value, a 19% upside to its current price.

Exploring Other Perspectives

Five fair value estimates from the Simply Wall St Community range widely from A$27.48 to A$68.66 per share. While some see deep value, others highlight that profit margins are now under pressure, making it even more important to review a wide spectrum of views on future returns.

Explore 5 other fair value estimates on James Hardie Industries - why the stock might be worth over 2x more than the current price!

Build Your Own James Hardie Industries Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your James Hardie Industries research is our analysis highlighting 2 key rewards and 4 important warning signs that could impact your investment decision.
• Our free James Hardie Industries research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate James Hardie Industries' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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