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NEW YORK - QXO, Inc. (NYSE:QXO), currently valued at $13.6 billion and showing strong momentum with a 16.7% gain last week, announced Tuesday its intention to offer $2 billion of common stock shares, according to a press release statement from the company.
The roofing and building products distributor, which according to InvestingPro maintains a strong balance sheet with more cash than debt, plans to grant underwriters an option to purchase up to an additional $300 million of shares at the public offering price less underwriting discounts and commissions.
Goldman Sachs & Co. LLC, Morgan Stanley and Wells Fargo Securities will serve as underwriters for the offering, which will be made through a prospectus supplement under QXO’s registration statement on Form S-3ASR filed with the Securities and Exchange Commission.
The company indicated it intends to use the net proceeds for general corporate purposes, potentially including future business acquisitions.
QXO describes itself as the largest publicly traded distributor of roofing, waterproofing and complementary building products in the United States.
The stock offering announcement comes as the company has previously stated plans to expand in the building products distribution industry. The press release noted that QXO is targeting $50 billion in annual revenues within the next decade through acquisitions and organic growth. InvestingPro analysis shows analysts expect significant growth, with revenue projected to increase by 128% this year. InvestingPro subscribers have access to 12 additional key insights about QXO’s growth potential and financial health.
The offering will be conducted through a prospectus supplement relating to the offering and accompanying prospectus, with copies available from the underwriters.
In other recent news, QXO Inc has been the focus of multiple analyst firms, all initiating coverage with an outperform rating. William Blair highlighted QXO’s acquisition of Beacon Building Products, projecting the company to reach $50 billion in revenue within the next decade through mergers and technological advancements. Baird also emphasized QXO’s growth outlook, noting the company’s strategy to double Beacon’s adjusted EBITDA and expand margins through accretive mergers. Oppenheimer praised the acquisition of Beacon as a strong foundation for QXO’s ambitions in the building products distribution sector, projecting a total adjusted EBITDA of $4.5 billion by 2030. Wolfe Research set a price target of $44, citing QXO’s potential for superior EBITDA growth through operational improvements and strategic acquisitions. Additionally, Roofr announced an integration with QXO, providing contractors with real-time pricing and streamlined ordering processes. This partnership aims to enhance efficiency for roofing professionals by connecting QXO’s distribution network with Roofr’s CRM system. These developments come as QXO continues to pursue its goal of significant expansion in the building products market.
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