Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Factors Supporting Owens Corning's (OC) 49% Growth in a Year

By Zacks Investment ResearchStock MarketsSep 06, 2021 10:29PM ET
www.investing.com/analysis/factors-supporting-owens-cornings-oc-49-growth-in-a-year-200601187
Factors Supporting Owens Corning's (OC) 49% Growth in a Year
By Zacks Investment Research   |  Sep 06, 2021 10:29PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

Owens Corning (NYSE:OC) OC has been benefiting from market-leading building materials businesses, strategic initiatives like product innovation and acquisitions as well as investments in process technology. Also, it has been witnessing strong volumes, broad price realization and high manufacturing efficiencies across businesses.

Shares of this Zacks Rank #2 (Buy) company have gained more than 49% in the past year, outperforming the Zacks Building Products - Miscellaneous industry’s 37.2% rally. The uptrend can be attributable to the above-mentioned tailwinds and a strong surprise history, having topped analysts’ expectation in the trailing nine quarters.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

Let’s delve deeper into factors that are influencing its overall performance.

Strategies to Drive Performance

Owens Corning (NYSE:GLW) has implemented strategic initiatives to drive overall performance. Segment-wise, in the Insulation unit, technical and other building insulation businesses look strong on the back of geographic and product expansion through acquisitions. In the North American residential fiberglass business, the company is utilizing automation and additional investments in process technology to improve manufacturing efficiencies as well as reduce costs.

The Composites segment has been generating higher volumes backed by its efforts toward higher value applications for glass non-wovens and specific markets like India. It focuses on improving low-cost manufacturing position through strategic supply agreements, accomplished large-scale furnace investments and additional productivity.

In the Roofing segment, Owens Corning is leveraging vertical integration, material science capabilities, and commercial strength to design and market unique roofing shingles as well as components that attract contractors, homeowners, and distributors.

On Jul 13, it announced the acquisition of vliepa GmbH. The acquisition broadened Owens Corning’s global nonwovens portfolio. All these initiatives are expected to aid the company to gain further.

Impressive Insulation Business, Housing & R&R Market

Owens Corning’s business experiences strong demand for insulating products. This is primarily driven by commercial and industrial construction activity, new residential construction, remodeling and repair activities as well as increased energy efficiency. For second-quarter 2021, the company witnessed increased volumes across the business. Especially in the technical and other insulation unit, demand was solid for its highly specified products backed by strong North America and Europe markets along with FOAMGLAS and mineral wool.

The U.S. housing industry has been booming despite headwinds like low inventory levels, inflationary pressure, and broad-based economic as well as public health risks associated with the new variants of the pandemic. Solid housing demand has been a boon for Owens Corning and companies like Masco MAS, TopBuild (NYSE:BLD) BLD, Construction Partners (NASDAQ:ROAD) ROAD and others in the same industry. Also, the industry stands to benefit from increased repair and remodeling activity as people are indulging more in do-it-yourself and professional activity. Greater-than-expected demand for home improvement products has also been benefiting the company.

Robust Outlook & Prospects

Backed by strong first-half results and impressive macroeconomic indicators for the residential housing industry, the company has provided a strong view for 2021. It expects the U.S. residential housing market to remain robust, and commercial and industrial markets to strengthen.

For the North American residential fiberglass insulation business, the company expects volume to be up 10% for the third quarter from last-year levels, given additional price realization. In the technical and other building insulation businesses, volumes are expected to rise 10% for the third quarter from the year-ago reading, with increasing demand for its products in global building and construction applications. Composites revenues are likely to improve year over year on improvement in sales mix and additional price realization, given strong commercial work. Roofing market is likely to be relatively flat in the third quarter from the prior year.

The Zacks Consensus Estimate for third-quarter earnings is currently pegged at $2.52 per share, indicating a 48.2% increase from the year-ago period. The same for revenues is pegged at $2.17 billion, suggesting a 14% increase from a year ago.

The consensus mark for 2021 earnings is currently pegged at $8.79 per share, indicating a 68.1% increase from the year-ago figure. The same for revenues is pegged at $8.29 billion, suggesting a 17.5% increase from a year ago.

The company’s solid VGM Score of A — driven by a Value and Growth Score of A — and Momentum Score of B are also justifying its prospects.


Zacks' Top Picks to Cash in on Artificial Intelligence

In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.

See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Masco Corporation (NYSE:MAS): Free Stock Analysis Report

Owens Corning Inc (OC): Free Stock Analysis Report

TopBuild Corp. (BLD): Free Stock Analysis Report

Construction Partners, Inc. (ROAD): Free Stock Analysis Report

To read this article on Zacks.com click here.
Factors Supporting Owens Corning's (OC) 49% Growth in a Year
 

Related Articles

Factors Supporting Owens Corning's (OC) 49% Growth in a Year

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email