As the Q4 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the home construction materials industry, including Hayward (NYSE: HAYW) and its peers.

Traditionally, home construction materials companies have built economic moats with expertise in specialized areas, brand recognition, and strong relationships with contractors. More recently, advances to address labor availability and job site productivity have spurred innovation that is driving incremental demand. However, these companies are at the whim of residential construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates. Additionally, the costs of raw materials can be driven by a myriad of worldwide factors and greatly influence the profitability of home construction materials companies.

The 12 home construction materials stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 1.5%.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 16.7% since the latest earnings results.

Hayward (NYSE: HAYW)

Credited with introducing the first variable-speed pool pump, Hayward (NYSE: HAYW) makes residential and commercial pool equipment and accessories.

Hayward reported revenues of $327.1 million, up 17.5% year on year. This print exceeded analysts’ expectations by 7.7%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ organic revenue and EBITDA estimates.

“I am pleased to report strong fourth quarter results ahead of expectations”Post this CEO COMMENTS

Hayward pulled off the biggest analyst estimates beat of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 14.5% since reporting and currently trades at $12.29.

Is now the time to buy Hayward? Access our full analysis of the earnings results here, it’s free.

Best Q4: Owens Corning (NYSE: OC)

Credited with the discovery of fiberglass, Owens Corning (NYSE: OC) supplies building and construction materials to the United States and international markets.

Owens Corning reported revenues of $2.84 billion, up 23.3% year on year, outperforming analysts’ expectations by 2.7%. The business had a stunning quarter with an impressive beat of analysts’ organic revenue and EBITDA estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 18.1% since reporting. It currently trades at $135.64.

Is now the time to buy Owens Corning? Access our full analysis of the earnings results here, it’s free.

Weakest Q4: American Woodmark (NASDAQ: AMWD)

Starting as a small millwork shop, American Woodmark (NASDAQ: AMWD) is a cabinet manufacturing company that helps customers from inspiration to installation.

American Woodmark reported revenues of $397.6 million, down 5.8% year on year, falling short of analysts’ expectations by 3.3%. It was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.

As expected, the stock is down 18.3% since the results and currently trades at $58.14.

Read our full analysis of American Woodmark’s results here.

Simpson (NYSE: SSD)

Aiming to build safer and stronger buildings, Simpson (NYSE: SSD) designs and manufactures structural connectors, anchors, and other construction products.

Simpson reported revenues of $517.4 million, up 3.1% year on year. This print surpassed analysts’ expectations by 4.3%. It was an exceptional quarter as it also recorded a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ EPS estimates.

The stock is down 12.4% since reporting and currently trades at $146.10.

Read our full, actionable report on Simpson here, it’s free.

Trex (NYSE: TREX)

Addressing the demand for aesthetically-pleasing and unique outdoor living spaces, Trex Company (NYSE: TREX) makes wood-alternative decking, railing, and patio furniture.

Trex reported revenues of $167.6 million, down 14.4% year on year. This number topped analysts’ expectations by 4.4%. Overall, it was a stunning quarter as it also produced a solid beat of analysts’ organic revenue estimates and an impressive beat of analysts’ EPS estimates.

Trex had the slowest revenue growth among its peers. The stock is down 12.5% since reporting and currently trades at $54.01.

Read our full, actionable report on Trex here, it’s free.

Market Update

Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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