We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
TopBuild (BLD) to Buy ABS, Expand Presence in East Coast
Read MoreHide Full Article
TopBuild Corp. (BLD - Free Report) intends to acquire all assets and businesses of the American Building Systems Group of Companies (“ABS”). The transaction, which is expected to be completed early in second-quarter 2021, will expand its presence in the East Coast.
Following the announcement, shares of the company gained 4.77% during yesterday’s trading session.
Buyout Synergies
ABS’ residential insulation and distribution business has major operations in Georgia, Virginia, the Carolinas, Florida, Massachusetts and New Jersey. It has 34 branches that primarily services the eastern United States. Approximately 94% of ABS’ $144 million annual revenues is generated from the installation of insulation and other building products, with the remaining 6% from distribution.
With this buyout, TopBuild will have a strong customer base, an experienced sales force and 500 highly trained installers to the company’s operations. This will also enhance its presence in many high-growth markets.
Solid Inorganic Moves Bode Well
Acquisitions are an important part of TopBuild’s growth strategy to supplement organic growth, and expand access to additional markets as well as products. During 2020, the company completed three acquisitions — Garland Insulating in October 2020, Hunter Insulation in February 2020 and Cooper Glass Co, LLC in February 2020.
Meanwhile, in January 2021, TopBuild acquired a fireproofing and insulation company, namely LCR Contractors. This acquisition led to the generation of approximately $58 million in annual revenues and helped TopBuild in servicing the Texas markets of Dallas, Austin and Amarillo, along with the Tennessee markets of Knoxville and Nashville.
Since 2016, the company has acquired 15 companies, which — on a combined basis — are contributing almost $650 million to annual revenues. The company remains focused on acquiring installation and distribution companies in core insulation.
Shares of TopBuild have increased 30.3% in the past six months compared with the industry's 20.8% rally. The company has been recording solid earnings and revenue growth over the last few quarters. Adjusted earnings for 2020 of $7.28 per share grew 32.6% year over year. Net sales advanced 3.6% from a year ago to $2.72 billion. Adjusted operating margin expanded 200 basis points (bps) to 13.2%. Adjusted EBITDA margin improved 240 bps to 16.1%. Despite the pandemic-induced challenges, both of its business segments reported revenue growth and solid margin expansion.
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Image: Bigstock
TopBuild (BLD) to Buy ABS, Expand Presence in East Coast
TopBuild Corp. (BLD - Free Report) intends to acquire all assets and businesses of the American Building Systems Group of Companies (“ABS”). The transaction, which is expected to be completed early in second-quarter 2021, will expand its presence in the East Coast.
Following the announcement, shares of the company gained 4.77% during yesterday’s trading session.
Buyout Synergies
ABS’ residential insulation and distribution business has major operations in Georgia, Virginia, the Carolinas, Florida, Massachusetts and New Jersey. It has 34 branches that primarily services the eastern United States. Approximately 94% of ABS’ $144 million annual revenues is generated from the installation of insulation and other building products, with the remaining 6% from distribution.
With this buyout, TopBuild will have a strong customer base, an experienced sales force and 500 highly trained installers to the company’s operations. This will also enhance its presence in many high-growth markets.
Solid Inorganic Moves Bode Well
Acquisitions are an important part of TopBuild’s growth strategy to supplement organic growth, and expand access to additional markets as well as products. During 2020, the company completed three acquisitions — Garland Insulating in October 2020, Hunter Insulation in February 2020 and Cooper Glass Co, LLC in February 2020.
Meanwhile, in January 2021, TopBuild acquired a fireproofing and insulation company, namely LCR Contractors. This acquisition led to the generation of approximately $58 million in annual revenues and helped TopBuild in servicing the Texas markets of Dallas, Austin and Amarillo, along with the Tennessee markets of Knoxville and Nashville.
Since 2016, the company has acquired 15 companies, which — on a combined basis — are contributing almost $650 million to annual revenues. The company remains focused on acquiring installation and distribution companies in core insulation.
Shares of TopBuild have increased 30.3% in the past six months compared with the industry's 20.8% rally. The company has been recording solid earnings and revenue growth over the last few quarters. Adjusted earnings for 2020 of $7.28 per share grew 32.6% year over year. Net sales advanced 3.6% from a year ago to $2.72 billion. Adjusted operating margin expanded 200 basis points (bps) to 13.2%. Adjusted EBITDA margin improved 240 bps to 16.1%. Despite the pandemic-induced challenges, both of its business segments reported revenue growth and solid margin expansion.
Zacks Rank
TopBuild currently carries a Zacks Rank #2 (Buy). The company shares space with Installed Building Products, Inc. (IBP - Free Report) , Gibraltar Industries, Inc. (ROCK - Free Report) and GCP Applied Technologies Inc. in the same industry, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>