It has been about a month since the last earnings report for Carlisle (CSL). Shares have added about 8.9% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Carlisle due for a pullback? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Carlisle Companies Incorporated before we dive into how investors and analysts have reacted as of late.
Carlisle Q2 Earnings Miss Estimates, Organic Revenues Decline Y/Y
Carlisle reported second-quarter 2025 adjusted earnings of $6.27 per share, which missed the Zacks Consensus Estimate of $6.67. However, the bottom line increased 0.5% year over year.
Carlisle’s total revenues of $1,449.5 million lagged the consensus estimate of $1,497 million and inched down 0.1% year over year. Organic revenues fell 3% year over year.
Segmental Discussion
Carlisle has divested its Carlisle Interconnect Technologies segment. The company now reports under the following two segments.
Revenues from the Carlisle Construction Materials segment increased 0.6% year over year to $1,096 million. Our estimate for segmental revenues was $1,115 million. Organic revenues decreased 0.6%. Revenues were driven by contributions from the MTL acquisition and stable recurring re-roof activity, partially offset by the weakness in the new construction market. Adjusted EBITDA of $346 million decreased 5% year over year.
Revenues from the Carlisle Weatherproofing Technologies segment decreased 2% year over year to $354 million, due to lower construction activities, partially offset by the buyouts of Plasti-Fab and ThermaFoam. Our estimate for segmental revenues was $384.7 million. Organic revenues slipped 10%. Adjusted EBITDA of $71 million declined 12.9% year over year.
Margin Profile
Carlisle’s cost of sales increased 3% year over year to $908.4 million. Selling and administrative expenses increased 4% to $196.9 million. Research and development expenses totaled $11.1 million, up 19.3% year over year.
Carlisle recorded an operating income of $335 million, down 11.3% year over year. The operating margin decreased 290 basis points to 23.1% from the year-ago quarter. Our estimate for the operating margin was pegged at 23.9%.
Carlisle’s Balance Sheet and Cash Flow
At the end of the second quarter, Carlisle had cash and cash equivalents of $68.4 million compared with $753.5 million at the end of 2024. Long-term debt (including the current portion) was $1.9 billion, relatively stable compared with the figure reported at the end of 2024.
In the first six months of 2025, Carlisle generated net cash of $288.9 million from operating activities compared with $346.9 million in the year-ago period.
In the same period, it rewarded its shareholders with a dividend payment of $88.3 million, up 8.1% year over year. The company bought back shares worth $700 million, flat year over year.
2025 Outlook
The company expects revenues to increase in the low single digits on a year-over-year basis. Revenues from both the Construction Materials and Weatherproofing Technologies segments are projected to increase in low-single-digit year-over year.
Adjusted EBITDA margin is expected to contract approximately 150 bps. Carlisle anticipates delivering record earnings per share in 2025. The free cash flow margin is expected to be more than 15%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -8.59% due to these changes.
VGM Scores
At this time, Carlisle has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, 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 indicates a downward shift. It's no surprise Carlisle has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Carlisle belongs to the Zacks Diversified Operations industry. Another stock from the same industry, 3M (MMM), has gained 5.6% over the past month. More than a month has passed since the company reported results for the quarter ended June 2025.
3M reported revenues of $6.16 billion in the last reported quarter, representing a year-over-year change of -1.6%. EPS of $2.16 for the same period compares with $1.93 a year ago.
3M is expected to post earnings of $2.07 per share for the current quarter, representing a year-over-year change of +4.6%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
3M has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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Carlisle Companies Incorporated (CSL): Free Stock Analysis Report 3M Company (MMM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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