Construction Stocks Earnings Releases On Jul 29: AWI, GVA

The recently released housing data has been fairly upbeat. Sales of new single-family houses rose 3.5% in Jun, reaching the highest level since Feb 2008. Housing starts clocked in 4.8% growth in Jun 2016. However, building permits, which indicate future construction trends, increased 1.5%, as builders added inventory cautiously due to lot shortages and regulatory problems. Nevertheless, strong job data for June is encouraging. In addition, the home remodeling market is also picking up pace.

On Jul 21, a couple of leading homebuilding companies reported their earnings. Atlanta-based homebuilder PulteGroup Inc. (NYSE:PHM) reported second-quarter results, beating estimates for both earnings and sales. However, another homebuilding company - D.R. Horton, Inc. (NYSE:DHI) – which reported on the same day did not fare as well. D.R. Horton exhibited a soft performance in the third quarter of fiscal 2016 with sales missing the Zacks Consensus Estimate and earnings coming in line with the same. However, the Texas-based homebuilder’s order trends were strong in the quarter.

On Jul 26, building products company, Masco Corporation (NYSE:MAS) reported second-quarter 2016 results. While its earnings beat estimates, revenues came in line with the same. Its second quarter performance was backed by significant year-over-year growth in earnings, revenues and margin, as the company capitalized on improving momentum in the repair and remodeling and new home construction industry.

Two leading construction companies are scheduled to report their quarterly results on Jul 29. Let us look at how these companies are placed ahead of their release.

Armstrong World Industries, Inc. (NYSE:AWI)

Pennsylvania-based, Armstrong World Industries is a global leader in suspended ceiling solutions that are used in renovation as well as new construction. In May, the company completed the previously announced spin-off of its flooring business into an independent public company, Armstrong Flooring, Inc. (NYSE:AFI) .

Armstrong World Industries is set to report second-quarter 2016 results before market opens.

Last quarter, Armstrong World Industries posted a positive surprise of 2.17%. The company surpassed estimates in three out of the past four quarters and has an average positive surprise of 11.23%.

ARMSTRONG WORLD Price and EPS Surprise

ARMSTRONG WORLD Price and EPS Surprise | ARMSTRONG WORLD Quote

Armstrong World Industries has an Earnings ESP of 0.00% and a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for the quarter is pegged at 51 cents.

Focus on new product development and cost reduction actions will drive the company’s profits. However, Armstrong World will be affected by fluctuations in the price of natural gas, & softness in commercial markets. The quarterly results are also likely to be hurt by high charges related to the separation of the flooring business.

Granite Construction Inc. (NYSE:GVA)

Granite Construction, a heavy civil contractor and construction materials produce, is set to report second-quarter 2016 results before market opens.

Last quarter, Granite Construction posted a negative surprise of 133.33%. The company missed estimates in three out of the past four quarters, recording an average negative surprise of 40.98%.

GRANITE CONSTRU Price and EPS Surprise

GRANITE CONSTRU Price and EPS Surprise | GRANITE CONSTRU Quote

Granite Construction has an Earnings ESP of 0.00% and a Zacks Rank #3. The Zacks Consensus Estimate for the quarter is pegged at 43 cents.

Conclusion

With the rise in demand for homes, new household formations and an improving job market in 2016, construction companies such as the ones discussed above are expected to witness strong demand for their products.

Stay Tuned! Check later on our full write-up on earnings releases of these stocks.