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Why Is TopBuild (BLD) Down 6.9% Since Last Earnings Report?
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It has been about a month since the last earnings report for TopBuild (BLD - Free Report) . Shares have lost about 6.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is TopBuild due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
TopBuild Q1 Earnings Beat Estimates on Acquisition-Led Sales Growth
TopBuild delivered a first-quarter 2026 earnings beat as acquisition-led growth more than offset softer residential demand and pricing pressure. Earnings of $3.75 per share beat the Zacks Consensus Estimate of $3.64 by 3% and declined 11.8% year over year.
Net sales climbed 17.2% year over year to $1.45 billion and topped the consensus mark of $1.41 billion by 2.5%. A key operating signal this quarter was the sales bridge; acquisitions added 24.3% to growth, while volume and price were down 5.5% and 1.6%, respectively.
BLD’s Sales Growth Powered by M&A
Management specifically cited the 2025 acquisitions of SPI and Progressive Roofing as the main drivers, helping the company push through a challenging backdrop in residential and light commercial new construction.
The revenue mix also tilted toward heavier commercial activity. Sales in Commercial/Industrial markets increased to $736.8 million compared with $463.5 million in the prior-year quarter, while Residential sales fell to $709.1 million from $769.8 million. That shift matters because it underscores how much of the quarter’s growth came from acquisitions and market exposure changes, not organic volume.
TopBuild’s Margin Profile Softer on Volume and Pricing
TopBuild’s gross profit was $400.3 million, up from $351.5 million a year ago, but gross margin contracted 80 basis points to 27.7%. The company attributed the decline primarily to lower sales volume and lower customer pricing.
SG&A expenses rose to $225.2 million from $174.0 million, pushing SG&A as a percentage of sales up to 15.6% from 14.1%. The higher cost burden reflected incremental expenses from acquisitions, including intangible amortization, which also weighed on year-over-year profitability.
BLD’s Segment Picture Showed a Clear Split
By segment, Installation Services sales increased 4.3% year over year to $777.3 million. The company noted that acquisitions added 16.9% to the segment’s growth, but this was more than offset by a 9.8% decline in volume and a 2.9% impact from lower selling prices.
Specialty Distribution was the growth engine. Segment sales jumped 31.7% to $737.1 million, driven by a 31.1% lift from acquisitions, with modest contributions from price (up 0.3%) and volume (up 0.3%). Even with the strong sales print, segment operating margin slipped to 10.9% from 12.3%, largely due to acquisition-related SG&A and amortization.
BLD’s Cash Flow, Liquidity, and Capital Priorities
BLD generated $160.7 million in operating cash flow, up from $152.6 million in the prior-year quarter, supported by working-capital benefits (notably accounts payable), partially offset by lower net income. Investing cash outflows rose to $41.5 million, driven by $27.9 million of acquisition spending and $14.0 million of capital expenditures.
As of March 31, 2026, TopBuild had $268.8 million in cash and cash equivalents and $934.1 million of availability under its revolving facility, for total liquidity of about $1.20 billion. Management also reiterated that M&A remains a priority and said it completed four acquisitions to date in 2026 that collectively add more than $80 million in annual revenues, while highlighting progress on SPI integration and synergy targets.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, TopBuild has a average Growth Score of C, a score with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. Interestingly, TopBuild has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is TopBuild (BLD) Down 6.9% Since Last Earnings Report?
It has been about a month since the last earnings report for TopBuild (BLD - Free Report) . Shares have lost about 6.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is TopBuild due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.
TopBuild Q1 Earnings Beat Estimates on Acquisition-Led Sales Growth
TopBuild delivered a first-quarter 2026 earnings beat as acquisition-led growth more than offset softer residential demand and pricing pressure. Earnings of $3.75 per share beat the Zacks Consensus Estimate of $3.64 by 3% and declined 11.8% year over year.
Net sales climbed 17.2% year over year to $1.45 billion and topped the consensus mark of $1.41 billion by 2.5%. A key operating signal this quarter was the sales bridge; acquisitions added 24.3% to growth, while volume and price were down 5.5% and 1.6%, respectively.
BLD’s Sales Growth Powered by M&A
Management specifically cited the 2025 acquisitions of SPI and Progressive Roofing as the main drivers, helping the company push through a challenging backdrop in residential and light commercial new construction.
The revenue mix also tilted toward heavier commercial activity. Sales in Commercial/Industrial markets increased to $736.8 million compared with $463.5 million in the prior-year quarter, while Residential sales fell to $709.1 million from $769.8 million. That shift matters because it underscores how much of the quarter’s growth came from acquisitions and market exposure changes, not organic volume.
TopBuild’s Margin Profile Softer on Volume and Pricing
TopBuild’s gross profit was $400.3 million, up from $351.5 million a year ago, but gross margin contracted 80 basis points to 27.7%. The company attributed the decline primarily to lower sales volume and lower customer pricing.
SG&A expenses rose to $225.2 million from $174.0 million, pushing SG&A as a percentage of sales up to 15.6% from 14.1%. The higher cost burden reflected incremental expenses from acquisitions, including intangible amortization, which also weighed on year-over-year profitability.
BLD’s Segment Picture Showed a Clear Split
By segment, Installation Services sales increased 4.3% year over year to $777.3 million. The company noted that acquisitions added 16.9% to the segment’s growth, but this was more than offset by a 9.8% decline in volume and a 2.9% impact from lower selling prices.
Specialty Distribution was the growth engine. Segment sales jumped 31.7% to $737.1 million, driven by a 31.1% lift from acquisitions, with modest contributions from price (up 0.3%) and volume (up 0.3%). Even with the strong sales print, segment operating margin slipped to 10.9% from 12.3%, largely due to acquisition-related SG&A and amortization.
BLD’s Cash Flow, Liquidity, and Capital Priorities
BLD generated $160.7 million in operating cash flow, up from $152.6 million in the prior-year quarter, supported by working-capital benefits (notably accounts payable), partially offset by lower net income. Investing cash outflows rose to $41.5 million, driven by $27.9 million of acquisition spending and $14.0 million of capital expenditures.
As of March 31, 2026, TopBuild had $268.8 million in cash and cash equivalents and $934.1 million of availability under its revolving facility, for total liquidity of about $1.20 billion. Management also reiterated that M&A remains a priority and said it completed four acquisitions to date in 2026 that collectively add more than $80 million in annual revenues, while highlighting progress on SPI integration and synergy targets.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, TopBuild has a average Growth Score of C, a score with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. Interestingly, TopBuild has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.