TopBuild (BLD) Buys Valley Gutter, Fortifies Service Partner

TopBuild Corp. BLD has acquired a fabricator and distributor of gutter products and specialty metals, Valley Gutter Supply, for an undisclosed amount. This addition helped the company to strengthen Service Partner’s gutter fabrication and distribution capacity throughout the state of California.

Valley Gutter — which generated trailing 12-month revenues of $10 million (on Jun 30, 2021) — serves customers primarily for the residential market. Markedly, 70% of Valley Gutter’s customers serve the residential market, with the balance serving light commercial.

Acquisitions: A Strong Growth Driver

TopBuild has a penchant for acquisitions and strategic alliances for bolstering inorganic growth as well as expanding market share. So far this year, TopBuild has wrapped up six acquisitions, which are expected to generate approximately $230 million of annual revenues.

In June, the company completed the acquisition of RJ Insulation that is expected to generate $4 million in annual revenues. During first-quarter 2021, it acquired LCR Contractors and Ozark Foam, a residential and light commercial insulation company. Also, in April 2021, TopBuild closed American Building Systems Group of Companies and Creative Conservation acquisitions.

Image Source: Zacks Investment Research

TopBuild’s shares have increased 17.7% year to date compared with the Zacks Building Products – Miscellaneous industry’s 12.9% rally. The company has been benefiting from robust U.S. housing market fundamentals, higher sales volumes and systematic inorganic strategy. Also, earnings estimates for 2021 have moved 4.1% upward over the past 30 days, depicting analysts’ optimism regarding its bottom-line growth potential.

Zacks Rank & Key Picks

TopBuild currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks from the same industry include Armstrong World Industries, Inc. AWI, Owens Corning Inc. OC and Otis Worldwide Corporation OTIS. While Armstrong World and Owens Corning currently sport a Zacks Rank #1, Otis carries a Zacks Rank #2 (Buy).

Earnings for Armstrong World, Owens Corning and Otis are expected to increase 16.3%, 68.1% and 17.9%, respectively, for 2021.

Tech IPOs With Massive Profit Potential

In the past few years, many popular platforms and like Uber and Airbnb finally made their way to the public markets. But the biggest paydays came from lesser-known names.

For example, electric carmaker X Peng shot up +299.4% in just 2 months. Think of it this way…

If you had put $5,000 into XPEV at its IPO in September 2020, you could have cashed out with $19,970 in November.

With record amounts of cash flooding into IPOs and a record-setting stock market, this year’s lineup could be even more lucrative.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.