Zacks Investment Research Downgrades Masco (MAS) to Sell

Masco (NYSE:MAS) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued on Monday, Zacks.com reports.

According to Zacks, “Shares of Masco have outperformed its industry year to date. Masco, being one of the leading cabinet manufacturers in the United States, operates through various divisions and offers a large number of products. The company is well poised in the near term on expectations of continued momentum in housing market backed by improving economy, low unemployment levels and positive consumer confidence. Increased repair and remodeling activity are also expected to generate higher revenues. However, higher raw material and ERP costs, as well as logistics expenses pose significant threats to the company's margins. Notably, Masco’s adjusted gross and operating margins contracted 200 basis points (bps) and 60 bps, respectively, in 2018. Earnings estimates have remained unchanged for 2019 over the past 30 days, limiting upside potential for the stock.”

Several other equities analysts also recently commented on the company. SunTrust Banks boosted their price objective on Masco to $52.00 and gave the company a “buy” rating in a research report on Thursday, March 14th. They noted that the move was a valuation call. Barclays restated a “buy” rating and issued a $39.00 price objective on shares of Masco in a research report on Sunday, February 10th. ValuEngine upgraded Masco from a “sell” rating to a “hold” rating in a research report on Friday, February 8th. Royal Bank of Canada set a $39.00 price objective on Masco and gave the company a “buy” rating in a research report on Friday, February 8th. Finally, Buckingham Research started coverage on Masco in a research report on Wednesday, January 23rd. They issued a “buy” rating and a $39.00 price objective on the stock. One equities research analyst has rated the stock with a sell rating, five have given a hold rating and eighteen have assigned a buy rating to the company. The stock presently has a consensus rating of “Buy” and a consensus price target of $43.35.

Shares of Masco stock opened at $39.99 on Monday. Masco has a 52 week low of $27.03 and a 52 week high of $41.00. The stock has a market capitalization of $11.68 billion, a PE ratio of 16.00, a price-to-earnings-growth ratio of 1.44 and a beta of 1.46. The company has a current ratio of 1.64, a quick ratio of 1.08 and a debt-to-equity ratio of 43.06.

Masco (NYSE:MAS) last announced its quarterly earnings data on Thursday, February 7th. The construction company reported $0.64 EPS for the quarter, beating the Thomson Reuters’ consensus estimate of $0.56 by $0.08. Masco had a return on equity of 520.34% and a net margin of 8.78%. The business had revenue of $2.04 billion for the quarter, compared to the consensus estimate of $2.01 billion. During the same period in the previous year, the business earned $0.44 earnings per share. The business’s revenue was up 10.1% on a year-over-year basis. On average, equities research analysts anticipate that Masco will post 2.69 EPS for the current fiscal year.

In related news, VP John P. Lindow sold 37,795 shares of the business’s stock in a transaction dated Friday, March 8th. The stock was sold at an average price of $39.07, for a total value of $1,476,650.65. Following the sale, the vice president now directly owns 60,454 shares in the company, valued at $2,361,937.78. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, Director Lisa A. Payne sold 9,117 shares of the business’s stock in a transaction dated Wednesday, March 6th. The stock was sold at an average price of $39.56, for a total value of $360,668.52. Following the completion of the sale, the director now owns 52,038 shares in the company, valued at $2,058,623.28. The disclosure for this sale can be found here. Insiders sold 298,940 shares of company stock worth $11,890,269 over the last quarter. 1.17% of the stock is owned by company insiders.

Hedge funds have recently modified their holdings of the business. CSat Investment Advisory L.P. raised its position in Masco by 97.9% during the fourth quarter. CSat Investment Advisory L.P. now owns 930 shares of the construction company’s stock valued at $27,000 after purchasing an additional 460 shares during the period. Bronfman E.L. Rothschild L.P. raised its position in Masco by 59.7% during the fourth quarter. Bronfman E.L. Rothschild L.P. now owns 1,118 shares of the construction company’s stock valued at $33,000 after purchasing an additional 418 shares during the period. Private Capital Group LLC grew its stake in shares of Masco by 333.3% during the fourth quarter. Private Capital Group LLC now owns 1,794 shares of the construction company’s stock valued at $52,000 after buying an additional 1,380 shares during the last quarter. Clean Yield Group bought a new position in shares of Masco during the fourth quarter valued at approximately $58,000. Finally, Essex Savings Bank bought a new position in shares of Masco during the fourth quarter valued at approximately $58,000. Institutional investors and hedge funds own 92.74% of the company’s stock.

About Masco

Masco Corporation designs, manufactures, and distributes home improvement and building products worldwide. The company's Plumbing Products segment offers faucets, showerheads, handheld showers, valves, bath hardware and accessories, bathing units, shower bases and enclosures, toilets, acrylic tubs, shower trays, spas, exercise pools, fitness systems, and other non-decorative plumbing products; brass, copper, and composite plumbing system components; and thermoplastic extrusions, extruded plastic profiles, and specialized fabrications.

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