Beacon Roofing Supply, Inc.BECN , the distributor of residential and non-residential roofing materials has acquired Acme Building Materials, Inc. in a bid to reinforce presence in Michigan. With the addition of Acme, a distributor of residential roofing and related building products, the number of Beacon locations in Michigan has gone up to 10.
Acme is a third generation, family owned business with branches in Flint, Rochester Hills and Brighton. Acme will strengthen Beacon's residential and complementary business in Michigan, which is an important market for the latter.
Beacon Roofing continues to balance year-to-year branch opening strategy with potential acquisitions. In fiscal 2016, the company completed eight acquisitions. In fiscal 2017, Beacon Roofing completed the buyout of BJ Supply in Dec 2016 and it acquired American Building and Roofing and Eco Insulation Supply in Jan 2017. The combined sales from these acquisitions are approximately $40-$50 million annually. Both BJ Supply and Eco Insulation Supply are complementary product focused businesses.
Beacon Roofing Supply, Inc. Price
The company is on the lookout for strong complementary product businesses to expand product line and geographic reach in this important category. American Building and Roofing has seven branches located throughout Washington state with a heavy weightage on residential roofing. The acquisition provides Beacon Roofing an important presence in the Pacific Northwest, which adds to its 2016 purchase of Woodfeathers out of Portland, OR and the three locations acquired with RSG in Washington state. Prior to fiscal 2016, Beacon Roofing had no presence in either Oregon or Washington but now boasts of 14 branches in the two states. The company intends to expand presence in the region. Further, it stated that it has a solid pipeline of acquisitions and will continue to pursue selective takeovers.
Beacon Roofing's share price performance has outperformed the Zacks categorized Building Products-Retail/Wholesale industry in the past one year. The stock has grown 20.5%, ahead of the industry's increase of 12.4% in the same time frame.
Zacks Rank & Key Picks
Beacon Roofing currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the sector include Rush Enterprises, Inc. RUSHA , Insight Enterprises, Inc. NSIT and Wingstop Inc. WING . All of these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
Rush Enterprises has delivered an average earnings surprise of 12.78% in the trailing four quarters. Insight Enterprises and Wingstop also delivered an average positive earnings surprise of 6.8% and 11.98%, respectively in the past four quarters.
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