NYSE:FBHS

Stock Analysis Report

Fortune Brands Home & Security

Executive Summary

Fortune Brands Home & Security, Inc., together with its subsidiaries, provides home and security products for residential home repair, remodeling, new construction, and security applications.


Snowflake Analysis

Undervalued with solid track record.


Similar Companies

Share Price & News

How has Fortune Brands Home & Security's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FBHS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-18.5%

FBHS

-8.5%

US Building

-2.8%

US Market


1 Year Return

-29.5%

FBHS

-26.6%

US Building

-15.9%

US Market

Return vs Industry: FBHS underperformed the US Building industry which returned -24.6% over the past year.

Return vs Market: FBHS underperformed the US Market which returned -15.1% over the past year.


Shareholder returns

FBHSIndustryMarket
7 Day-18.5%-8.5%-2.8%
30 Day-41.4%-35.3%-18.8%
90 Day-46.2%-36.7%-24.0%
1 Year-28.4%-29.5%-25.4%-26.6%-14.2%-15.9%
3 Year-40.2%-42.7%-23.0%-26.6%9.9%2.8%
5 Year-17.9%-23.2%-8.8%-20.5%27.2%13.3%

Price Volatility Vs. Market

How volatile is Fortune Brands Home & Security's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Fortune Brands Home & Security undervalued compared to its fair value and its price relative to the market?

46.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FBHS ($35.42) is trading below our estimate of fair value ($65.21)

Significantly Below Fair Value: FBHS is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: FBHS is good value based on its PE Ratio (11.5x) compared to the Building industry average (14.7x).

PE vs Market: FBHS is good value based on its PE Ratio (11.5x) compared to the US market (12.4x).


Price to Earnings Growth Ratio

PEG Ratio: FBHS is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: FBHS is overvalued based on its PB Ratio (2x) compared to the US Building industry average (1.1x).


Next Steps

Future Growth

How is Fortune Brands Home & Security forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

12.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FBHS's forecast earnings growth (12.4% per year) is above the savings rate (1.7%).

Earnings vs Market: FBHS's earnings (12.4% per year) are forecast to grow slower than the US market (13.4% per year).

High Growth Earnings: FBHS's earnings are forecast to grow, but not significantly.

Revenue vs Market: FBHS's revenue (4% per year) is forecast to grow slower than the US market (7.1% per year).

High Growth Revenue: FBHS's revenue (4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FBHS's Return on Equity is forecast to be low in 3 years time (17.3%).


Next Steps

Past Performance

How has Fortune Brands Home & Security performed over the past 5 years?

9.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FBHS has high quality earnings.

Growing Profit Margin: FBHS's current net profit margins (7.5%) are higher than last year (7.1%).


Past Earnings Growth Analysis

Earnings Trend: FBHS's earnings have grown by 9.1% per year over the past 5 years.

Accelerating Growth: FBHS's earnings growth over the past year (10.8%) exceeds its 5-year average (9.1% per year).

Earnings vs Industry: FBHS earnings growth over the past year (10.8%) exceeded the Building industry -15.9%.


Return on Equity

High ROE: FBHS's Return on Equity (17.8%) is considered low.


Next Steps

Financial Health

How is Fortune Brands Home & Security's financial position?


Financial Position Analysis

Short Term Liabilities: FBHS's short term assets ($1.9B) exceed its short term liabilities ($1.4B).

Long Term Liabilities: FBHS's short term assets ($1.9B) do not cover its long term liabilities ($2.5B).


Debt to Equity History and Analysis

Debt Level: FBHS's debt to equity ratio (90%) is considered high.

Reducing Debt: FBHS's debt to equity ratio has increased from 29.6% to 90% over the past 5 years.

Debt Coverage: FBHS's debt is well covered by operating cash flow (29.2%).

Interest Coverage: FBHS's interest payments on its debt are well covered by EBIT (7.9x coverage).


Balance Sheet

Inventory Level: FBHS has a high level of physical assets or inventory.

Debt Coverage by Assets: FBHS's debt is not covered by short term assets (assets are 0.9x debt).


Next Steps

Dividend

What is Fortune Brands Home & Security's current dividend yield, its reliability and sustainability?

2.71%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: FBHS's dividend (2.71%) is higher than the bottom 25% of dividend payers in the US market (2.05%).

High Dividend: FBHS's dividend (2.71%) is low compared to the top 25% of dividend payers in the US market (5.71%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, FBHS has been paying a dividend for less than 10 years.

Growing Dividend: FBHS's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (28.5%), FBHS's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FBHS's dividends in 3 years are forecast to be well covered by earnings (21.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.0yrs

Average management tenure


CEO

Nick Fink (44yo)

0.25

Tenure

US$4,665,678

Compensation

Mr. Nicholas Ian Fink, also known as Nick, serves as Chief Executive Officer and Director of Fortune Brands Home & Security, Inc. since January 6, 2020. Mr. Fink served as President and Chief Operating Off ...


CEO Compensation Analysis

Compensation vs Market: Nick's total compensation ($USD4.67M) is below average for companies of similar size in the US market ($USD7.63M).

Compensation vs Earnings: Nick's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Christopher Klein
Executive Chairman of the Board0.25yrUS$10.69m0.26% $12.9m
Nicholas Fink
CEO & Director0.25yrUS$4.67m0.031% $1.5m
Patrick Hallinan
Senior VP & CFO2.75yrsUS$2.74m0.016% $805.6k
Brett Finley
President of Doors & Security Segment4.17yrsUS$2.63m0.011% $544.3k
R. Banyard
President of MasterBrand Cabinets Inc.0.42yrUS$3.54mno data
Martin Thomas
Senior Vice President of Operations & Supply Chain Strategy2.58yrsno data0.0031% $152.4k
Brian Lantz
Senior Vice President of Communications & Corporate Administration3.25yrsno data0.012% $577.0k
Kaveh Bakhtiari
Director of Investor Relationsno datano datano data
Robert Biggart
Senior VP6.33yrsUS$1.94m0.029% $1.4m
Sheri Grissom
Senior VP & Chief Human Resources Officer5.17yrsno data0.014% $668.5k

3.0yrs

Average Tenure

55yo

Average Age

Experienced Management: FBHS's management team is considered experienced (3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Christopher Klein
Executive Chairman of the Board0.25yrUS$10.69m0.26% $12.9m
Nicholas Fink
CEO & Director0.25yrUS$4.67m0.031% $1.5m
Allan MacKay
Independent Director8.58yrsUS$240.82k0.014% $691.8k
John Morikis
Independent Director8.33yrsUS$245.82k0.029% $1.4m
Ronald Waters
Independent Director8.58yrsUS$251.44k0.0083% $410.7k
Ann Hackett
Independent Director8.58yrsUS$253.32k0.00029% $14.4k
David Thomas
Lead Independent Directorno dataUS$453.32k0.029% $1.4m
Susan Kilsby
Independent Director4.75yrsUS$233.32k0.0067% $333.0k
Irial Finan
Independent Director1.17yrsUS$217.92k0.0018% $86.6k

6.5yrs

Average Tenure

62yo

Average Age

Experienced Board: FBHS's board of directors are considered experienced (6.5 years average tenure).


Ownership

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

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Fortune Brands Home & Security, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Fortune Brands Home & Security, Inc.
  • Ticker: FBHS
  • Exchange: NYSE
  • Founded: 1988
  • Industry: Building Products
  • Sector: Capital Goods
  • Market Cap: US$4.948b
  • Shares outstanding: 139.71m
  • Website: https://www.fbhs.com

Number of Employees


Location

  • Fortune Brands Home & Security, Inc.
  • 520 Lake Cook Road
  • Deerfield
  • Illinois
  • 60015
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FBHSNYSE (New York Stock Exchange)YesCommon SharesUSUSDSep 2011
2FBDB (Deutsche Boerse AG)YesCommon SharesDEEURSep 2011
0IRNLSE (London Stock Exchange)YesCommon SharesGBUSDSep 2011
2FBBRSE (Berne Stock Exchange)YesCommon SharesCHCHFSep 2011
F1BH34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 SHS UNSPONBRBRLJan 2020

Biography

Fortune Brands Home & Security, Inc., together with its subsidiaries, provides home and security products for residential home repair, remodeling, new construction, and security applications. It operates in three segments: Cabinets, Plumbing, and Doors & Security. The Cabinets segment manufactures custom, semi-custom, and stock cabinetry, as well as vanities for the kitchen, bath, and other parts of the home directly to kitchen and bath dealers, home centers, wholesalers, and builders in North America under the Diamond, Aristokraft, Mid-Continent, Kitchen Craft, Homecrest, Omega, StarMark, Ultracraft, Kemper, Schrock, Decora, and Mantra brand names. The Plumbing segment manufactures, assembles, and sells faucets, accessories, kitchen sinks, and waste disposals in the United States, China, Canada, Mexico, Southeast Asia, Europe, and South America directly through its own sales force, as well as through independent manufacturers’ representatives primarily to wholesalers, home centers, mass merchandisers, and industrial distributors. The Doors & Security segment offers fiberglass and steel entry door systems under the Therma-Tru brand name; composite decking and railing under the Fiberon brand name; and urethane millwork under the Fypon brand name. This segment also manufactures, sources, and distributes locks, safety and security devices, and electronic security products under the Master Lock and American Lock brand names; and fire resistant safes, security containers, and commercial cabinets under the SentrySafe brand name. It serves home centers, hardware and other retailers, millwork building products and wholesale distributors, specialty dealers, and remodeling and renovation markets, as well as locksmiths, industrial and institutional users, and original equipment manufacturers. This segment sells its products in the United States, Canada, Europe, Central America, Japan, and Australia. The company was founded in 1988 and is headquartered in Deerfield, Illinois. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/05 05:39
End of Day Share Price2020/04/03 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.