BECN Stock Overview
Beacon Roofing Supply, Inc., together with its subsidiaries, distributes residential and non-residential roofing materials, and complementary building products to contractors, home builders, building owners, lumberyards, and retailers.
Beacon Roofing Supply Competitors
Price History & Performance
|Historical stock prices|
|Current Share Price||US$56.88|
|52 Week High||US$65.30|
|52 Week Low||US$45.71|
|1 Month Change||6.60%|
|3 Month Change||6.88%|
|1 Year Change||19.40%|
|3 Year Change||83.54%|
|5 Year Change||8.90%|
|Change since IPO||433.58%|
Recent News & Updates
Is Beacon Roofing Supply (NASDAQ:BECN) A Risky Investment?
Howard Marks put it nicely when he said that, rather than worrying about share price volatility, 'The possibility of...
Beacon Roofing Supply: An Attractive Play Even If Fundamentals Worsen
Summary Beacon Roofing Supply has done well recently, with sales and cash flows rising nicely. Uncertainty exists regarding the future, but that's to be expected given current economic conditions. In all, shares look attractively priced even if performance reverts back to what it was in 2021. If you have owned a home long enough, it is a guarantee that at some point you will have to worry about that home's roof. And unless you are homeless, a roof of some form had to, at one point, been placed above your head. One company on the market that is described as the largest publicly traded distributor of roofing materials and complementary building products in North America is Beacon Roofing Supply (NASDAQ:BECN). Over the past three years, the financial picture of the company has been quite positive. This year, in particular, growth continues to impress. Add on top of this the fact that shares of the company look quite cheap and it is definitely worth some consideration. To be fair, some investors may be worried about the state of the housing market, with rising interest rates, rising inflation, and other concerns potentially proving to weaken the demand for housing and, in turn, weaken the demand for roofing materials as property owners might choose to delay costly replacements or repairs until some point in the future. But even if the company sees its financial performance drop back to the kind of levels experienced in 2020, it's difficult to say that shares are unattractively priced. A roof over your head As I mentioned already, Beacon Roofing Supply operates as a distributor of roofing materials and complementary building products. As of the end of its latest completed fiscal year, the company ran its operations out of 446 branches that were spread across all 50 States and throughout six provinces in Canada. The company currently has a rather significant portfolio of products comprising over 100,000 SKUs that it uses to serve more than 80,000 customers in both the residential and non-residential markets. To keep track of it all and to optimize business activities, the company operates something called the Beacon OTC Network. This is an operating model where the branches the company has are networked for the purpose of sharing inventory, fleet, equipment, systems, and even employees, all for the purpose of optimizing the customer delivery experience. Though not ubiquitous yet, the company is moving in that direction. As of the end of the latest fiscal year, these networked branches totaled 250 in all. Although the company may seem like a low-tech outfit, management does take pride in some of the digital initiatives the company has undertaken. For instance, the company currently has a software solution called Beacon PRO+ that operates as its proprietary digital account management suite. Through this, customers are able to manage their business with the enterprise online. The company also has another software solution called Beacon 3D+ that operates as a roofing estimating tool for its residential customers. Customers are also able to search the catalog of products the company has, accessing real-time pricing. Customers are also able to place orders, track deliveries, monitor local storm activity, and more through the company's software solutions. Author - SEC EDGAR Data Normally when I analyze a company, I like to look at fundamental performance covering five years. Sadly, this is not always possible to do with accuracy. In the case of Beacon Roofing Supply, the picture is complicated by the fact that, in early 2021, the business completed the sale of its interior products and insulation businesses in exchange for $850 million in cash. Because of the timing of this transaction, we only have financial statements that would be comparable for the past three years ending in 2021. What data we do have, however, does look promising. Considering revenue, between 2019 and 2021, sales for the company grew from $6 billion to $6.64 billion. This increase was driven by strong demand for both residential and complementary products across all the regions in which the company operates. It also was successful in raising prices for its three main product lines. These are the residential roofing products, non-residential roofing products, and complementary building products that it sells. The greatest growth for the company (from a dollar perspective) from 2020 to 2021 when essentially all of that revenue increase took place came from the residential roofing products category, with revenue skyrocketing by 14.2%. Author - SEC EDGAR Data The picture for the business, it should be said, is rather odd because management elected to move their year-end reporting period to December of each year. This has resulted in two different measures of annual performance for the 2020 and 2021 fiscal years. Using the new time period the company elected, sales last year would have been $6.82 billion instead of $6.65 billion. And for 2020 it would be $6.08 billion. Management attributed this move to the company's desire to better align their financial reporting calendar with many of the other players in the space and to provide internal benefits by shifting the timing of budgeting, physical inventory, and performance review cycles away from the busiest time of the year for it. This also happened to coincide with multiple transactions that occurred near the end of last year, including the sale of its solar products business, an entity that generated about $111 million in sales annually. Profitability for the company has been a bit more complicated to understand. In each of the past three years, for instance, net income came in negative. And on that front, there was no real trend. However, operating cash flow was positive, even though it was volatile. After rising from $212.7 million in 2019 to $479.3 million in 2020, it then plunged to $78 million last year. But if we were to adjust for changes in working capital, it would have risen consistently, climbing from $291.6 million to $438.8 million. Meanwhile, EBITDA for the firm also improved nicely, climbing from $383.1 million to $654.7 million over the same window of time. Once again, we also need to pay attention to the updated financial results of the company to account for the transition period. Net income in 2020 using this convention was negative to the tune of $9.9 million. In 2021, profits rose to $241.9 million. Adjusted net income, meanwhile, rose from $198.6 million to $394.4 million. Operating cash flow did fall, dropping from $565.5 million to $166.7 million. But if we adjust for changes in working capital, it would have risen from $362.7 million to $463.4 million. Meanwhile, EBITDA for the company also increased, climbing from $464.6 million to $685.9 million. Author - SEC EDGAR Data When it comes to the 2022 fiscal year, the company has continued to see strong performance. Revenue in the first half of the year came in at $4.05 billion. This is 26.8% higher than the $3.19 billion seen just one year earlier. Growth in the second quarter alone was still robust, with sales of $2.36 billion coming in 26% above the $1.87 billion achieved last year. Once again, the company has continued to benefit from favorable industry conditions. On the bottom line, performance has also been favorable. Net income in the first half of last year came in at $69.3 million. This increased to $230.3 million in the first half of 2022. Operating cash flow did decline, dropping from $18.7 million to negative $187 million. But if we were to adjust for changes in working capital, it would have more than doubled from $156.8 million to $323.1 million. Meanwhile, EBITDA for the company also improved, climbing from $303.8 million to $447.2 million. Author - SEC EDGAR Data Although investors might be worried about current market conditions, management remains hopeful for the future. Their current goal, despite problems in the industry, is to grow sales to $9 billion per year by 2025. That implies an annualized growth rate of roughly 8%. In that vein, the company has embarked on a number of interesting transactions. In April of this year, for instance, the company announced the acquisition of Wichita Falls Builders Wholesale for an undisclosed sum. The company also completed, in early June, the acquisition of Complete Supply. Even as the company continues to invest for growth, it also seems to be committed to the idea of buying back stock. In June of this year, the company announced one of two accelerated share repurchase programs. This particular repurchase was in the amount of $250 million and followed one from March in the amount of $125 million.
Here's Why Beacon Roofing Supply (NASDAQ:BECN) Has Caught The Eye Of Investors
It's common for many investors, especially those who are inexperienced, to buy shares in companies with a good story...
|BECN||US Trade Distributors||US Market|
Return vs Industry: BECN exceeded the US Trade Distributors industry which returned -12.1% over the past year.
Return vs Market: BECN exceeded the US Market which returned -23.2% over the past year.
|BECN Average Weekly Movement||4.5%|
|Trade Distributors Industry Average Movement||5.8%|
|Market Average Movement||6.8%|
|10% most volatile stocks in US Market||15.5%|
|10% least volatile stocks in US Market||2.8%|
Stable Share Price: BECN is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.
Volatility Over Time: BECN's weekly volatility (5%) has been stable over the past year.
About the Company
Beacon Roofing Supply, Inc., together with its subsidiaries, distributes residential and non-residential roofing materials, and complementary building products to contractors, home builders, building owners, lumberyards, and retailers. It offers pitched roofing and low slope roof products; gutters and sidings; building materials, such as lumber and composite, skylights and window, plywood and OSB, decking and railing, and HVAC products; and foam board, spray foam, roll, batt, mineral wool, fiberglass, and commercial insulation products, as well as radiant barriers and blown-in insulation and equipment. The company also provides above grade and below grade membranes and coatings, deck and floor coatings, plaza deck waterproofing products, damp proofing coatings, and air and vapor barriers; tools and equipment, including power and hand tools, ladders and scaffolding, air tools and compressors, nails, screws and fasteners, generators, work wear and safety gear, job site supplies, tool bags and belts, welding and soldering, cleaning supplies, drill bits, and saw blades; and solar panels, mounting hardware, inverters, and storage and batteries.
Beacon Roofing Supply Fundamentals Summary
|BECN fundamental statistics|
Is BECN overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|BECN income statement (TTM)|
|Cost of Revenue||US$5.79b|
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
|Earnings per share (EPS)||5.53|
|Net Profit Margin||4.57%|
How did BECN perform over the long term?See historical performance and comparison
Is BECN undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score 5/6
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Key Valuation Metric
Which metric is best to use when looking at relative valuation for BECN?
Other financial metrics that can be useful for relative valuation.
|What is BECN's n/a Ratio?|
Price to Earnings Ratio vs Peers
How does BECN's PE Ratio compare to its peers?
|BECN PE Ratio vs Peers|
|Company||PE||Estimated Growth||Market Cap|
UNVR Univar Solutions
TRTN Triton International
HRI Herc Holdings
AIT Applied Industrial Technologies
BECN Beacon Roofing Supply
Price-To-Earnings vs Peers: BECN is expensive based on its Price-To-Earnings Ratio (10.3x) compared to the peer average (9.7x).
Price to Earnings Ratio vs Industry
How does BECN's PE Ratio compare vs other companies in the US Trade Distributors Industry?
Price-To-Earnings vs Industry: BECN is good value based on its Price-To-Earnings Ratio (10.3x) compared to the US Trade Distributors industry average (11x)
Price to Earnings Ratio vs Fair Ratio
What is BECN's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
|Current PE Ratio||10.3x|
|Fair PE Ratio||15.1x|
Price-To-Earnings vs Fair Ratio: BECN is good value based on its Price-To-Earnings Ratio (10.3x) compared to the estimated Fair Price-To-Earnings Ratio (15.1x).
Share Price vs Fair Value
What is the Fair Price of BECN when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: BECN ($56.88) is trading below our estimate of fair value ($79.57)
Significantly Below Fair Value: BECN is trading below fair value by more than 20%.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.
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How is Beacon Roofing Supply forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?
Future Growth Score0/6
Future Growth Score 0/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: BECN's forecast earnings growth (0.8% per year) is below the savings rate (1.9%).
Earnings vs Market: BECN's earnings (0.8% per year) are forecast to grow slower than the US market (14.8% per year).
High Growth Earnings: BECN's earnings are forecast to grow, but not significantly.
Revenue vs Market: BECN's revenue (0.3% per year) is forecast to grow slower than the US market (7.7% per year).
High Growth Revenue: BECN's revenue (0.3% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: Insufficient data to determine if BECN's Return on Equity is forecast to be high in 3 years time
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How has Beacon Roofing Supply performed over the past 5 years?
Past Performance Score5/6
Past Performance Score 5/6
Growing Profit Margin
Earnings vs Industry
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: BECN has high quality earnings.
Growing Profit Margin: BECN's current net profit margins (4.6%) are higher than last year (2.1%).
Past Earnings Growth Analysis
Earnings Trend: BECN's earnings have grown significantly by 23.9% per year over the past 5 years.
Accelerating Growth: BECN's earnings growth over the past year (122.9%) exceeds its 5-year average (23.9% per year).
Earnings vs Industry: BECN earnings growth over the past year (122.9%) exceeded the Trade Distributors industry 58.7%.
Return on Equity
High ROE: Whilst BECN's Return on Equity (20.88%) is high, this metric is skewed due to their high level of debt.
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How is Beacon Roofing Supply's financial position?
Financial Health Score3/6
Financial Health Score 3/6
Short Term Liabilities
Long Term Liabilities
Financial Position Analysis
Short Term Liabilities: BECN's short term assets ($3.3B) exceed its short term liabilities ($1.8B).
Long Term Liabilities: BECN's short term assets ($3.3B) exceed its long term liabilities ($2.5B).
Debt to Equity History and Analysis
Debt Level: BECN's net debt to equity ratio (97.3%) is considered high.
Reducing Debt: BECN's debt to equity ratio has increased from 84.7% to 100.3% over the past 5 years.
Debt Coverage: BECN's operating cash flow is negative, therefore debt is not well covered.
Interest Coverage: BECN's interest payments on its debt are well covered by EBIT (10.2x coverage).
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What is Beacon Roofing Supply current dividend yield, its reliability and sustainability?
Dividend Score 0/6
Cash Flow Coverage
Dividend Yield vs Market
|Beacon Roofing Supply Dividend Yield vs Market|
|Company (Beacon Roofing Supply)||n/a|
|Market Bottom 25% (US)||1.7%|
|Market Top 25% (US)||4.7%|
|Industry Average (Trade Distributors)||2.7%|
|Analyst forecast in 3 Years (Beacon Roofing Supply)||0%|
Notable Dividend: Unable to evaluate BECN's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.
High Dividend: Unable to evaluate BECN's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if BECN's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if BECN's dividend payments have been increasing.
Earnings Payout to Shareholders
Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: Unable to calculate sustainability of dividends as BECN has not reported any payouts.
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How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Julian Francis (55 yo)
Mr. Julian G. Francis has been President, Chief Executive Officer of Beacon Roofing Supply, Inc. since August 2019 and serves as its Director since August 22, 2019. Mr. Francis has been the President of In...
CEO Compensation Analysis
|Julian Francis's Compensation vs Beacon Roofing Supply Earnings|
|Date||Total Comp.||Salary||Company Earnings|
|Jun 30 2022||n/a||n/a|
|Mar 31 2022||n/a||n/a|
|Dec 31 2021||n/a||n/a|
|Sep 30 2021||US$6m||US$811k|
|Jun 30 2021||n/a||n/a|
|Mar 31 2021||n/a||n/a|
|Dec 31 2020||n/a||n/a|
|Sep 30 2020||US$4m||US$754k|
|Jun 30 2020||n/a||n/a|
|Mar 31 2020||n/a||n/a|
|Dec 31 2019||n/a||n/a|
|Sep 30 2019||US$3m||US$114k|
Compensation vs Market: Julian's total compensation ($USD5.66M) is about average for companies of similar size in the US market ($USD6.90M).
Compensation vs Earnings: Julian's compensation has increased by more than 20% in the past year.
Experienced Management: BECN's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.
Experienced Board: BECN's board of directors are considered experienced (6.7 years average tenure).
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
|29 Jul 22||BuyUS$5,999,999||Clayton, Dubilier & Rice, LLC||Company||103,931||US$57.73|
|19 May 22||SellUS$143,382||James Gosa||Individual||2,300||US$62.34|
|29 Apr 22||BuyUS$5,999,949||Clayton, Dubilier & Rice, LLC||Company||102,219||US$58.70|
|28 Jan 22||BuyUS$5,999,999||Clayton, Dubilier & Rice, LLC||Company||107,456||US$55.84|
|29 Oct 21||BuyUS$5,999,980||Clayton, Dubilier & Rice, LLC||Company||116,945||US$51.31|
|Owner Type||Number of Shares||Ownership Percentage|
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
|Ownership||Name||Shares||Current Value||Change %||Portfolio %|
Beacon Roofing Supply, Inc.'s employee growth, exchange listings and data sources
- Name: Beacon Roofing Supply, Inc.
- Ticker: BECN
- Exchange: NasdaqGS
- Founded: 1928
- Industry: Trading Companies and Distributors
- Sector: Capital Goods
- Implied Market Cap: US$3.557b
- Shares outstanding: 65.00m
- Website: https://www.becn.com
Number of Employees
- Beacon Roofing Supply, Inc.
- 505 Huntmar Park Drive
- Suite 300
- United States
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|BECN||NasdaqGS (Nasdaq Global Select)||Yes||Common Stock||US||USD||Sep 2004|
|OWY||DB (Deutsche Boerse AG)||Yes||Common Stock||DE||EUR||Sep 2004|
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2022/10/03 00:00|
|End of Day Share Price||2022/10/03 00:00|
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.