Masco Gears Up for Q1 Earnings: What's in the Offing for the Stock?

Masco Corporation MAS is scheduled to report first-quarter 2025 results on April 23, before the opening bell.

In the last reported quarter, the company’s adjusted earnings beat the Zacks Consensus Estimate by 1.1%. Masco’s earnings topped the consensus mark in three of the last four quarters and met on the remaining occasion, the average surprise being 2.9%.

MAS’ Estimate Revision Trend

The Zacks Consensus Estimate for adjusted earnings per share (EPS) has been unchanged at 92 cents over the past seven days. The estimated figure indicates a 1.1% decline from the year-ago EPS of 93 cents. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

The consensus estimate for net sales is pegged at $1.84 billion, which indicates a 4.7% decline from the prior-year quarter’s figure of $1.93 billion.

Factors Likely to Define Masco’s Q1 Results

The company’s top line in the quarter to be reported is likely to have been hurt by lower contributions from the Decorative Architectural Products segment, which reflects decreased DIY paint sales. Slow demand for many of its products is likely to have negatively impacted the company’s performance. Moreover, a decline in sales of the Plumbing Products segment is expected to have further dampened its top line.  

Segment-wise, our model expects the Plumbing Products segment’s (which accounted for 65% of total net sales in fourth-quarter 2024) net sales to decrease 1.9% year over year to $1.17 billion.  The expectations for the Decorative Architectural Products segment’s (which accounted for 35% of total net sales in the fourth quarter) net sales indicate an 8% decline year over year to $675.3 million.

Geographically, we expect net sales in North America (which accounted for 79.2% of fourth-quarter total net sales) to decline 3.8% year over year to $1.47 billion. Net sales in International (which accounted for 20.8% of fourth-quarter total net sales) are anticipated to decrease year over year by 5.7% to $377.2 million.

Moreover, the company’s bottom line in first-quarter 2025 is likely to have been negatively impacted by high costs. Unfavorable sales mix, higher marketing and employee-related costs and ongoing inflationary pressures are likely to have been headwinds. Despite undertaking strategic cost-saving initiatives to tone down the negative impacts, commodity cost inflation persists.

What Our Model Unveils for MAS

Our proven model does not conclusively predict an earnings beat for Masco this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here.

MAS’ Earnings ESP: MAS has an Earnings ESP of -0.82%. You can uncover the best stocks before they are reported with our Earnings ESP Filter.

Zacks Rank of MAS: The company currently carries a Zacks Rank of 4 (Sell).

Stocks With the Favorable Combination

Some companies in the Zacks Construction sector, which according to our model, have the right combination of elements to beat on earnings in their respective quarters to be reported are MasTec, Inc. MTZ, Meritage Homes Corporation MTH and Martin Marietta Materials, Inc. MLM.
 
MasTec has an Earnings ESP of +0.85% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
 
The company’s earnings beat estimates in each of the last four quarters, the average surprise being 31.6%. MasTec’s earnings for the quarter to be reported are expected to increase 361.5%.
 
Meritage Homes currently has an Earnings ESP of +0.62% and a Zacks Rank of 3.
 
The company’s earnings beat estimates in each of the last four quarters, the average surprise being 46.1%. Meritage Homes’ earnings for the quarter to be reported are expected to decrease 32.4%.
 
Martin Marietta currently has an Earnings ESP of +4.48% and a Zacks Rank of 3.
 
Its earnings beat estimates in two of the last four quarters and missed twice, the average negative surprise being 1.7%. Martin Marietta’s earnings for the quarter to be reported are expected to decrease 4.7%.

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This article originally published on Zacks Investment Research (zacks.com).

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