Topbuild Corp

BLD

Construction - Special Trade Contractors

Mkt Cap

$12.74B

PE

20.20

Debt

$1.469B

Cash

$968.8M

EV

$13.24B

FCF

$790.1M

Market Cap

$12.74B

P/E Ratio

20.20

Debt

$1.469B

Cash

$968.8M

EV

$13.24B

FCF

$790.1M

Charts data: {"Earnings":[{"time":"2014-12-30","value":9403000},{"time":"2015-12-30","value":78971000},{"time":"2016-12-30","value":72606000},{"time":"2017-12-30","value":158133000},{"time":"2018-12-30","value":134752000},{"time":"2019-12-30","value":190995000},{"time":"2020-12-30","value":247023000},{"time":"2021-12-30","value":324016000},{"time":"2022-12-30","value":555989000},{"time":"2023-12-30","value":614254000}],"Sales":[{"time":"2014-12-30","value":1512077000},{"time":"2015-12-30","value":1616580000},{"time":"2016-12-30","value":1742850000},{"time":"2017-12-30","value":1906266000},{"time":"2018-12-30","value":2384249000},{"time":"2019-12-30","value":2624121000},{"time":"2020-12-30","value":2718038000},{"time":"2021-12-30","value":3486207000},{"time":"2022-12-30","value":5008744000},{"time":"2023-12-30","value":5194694000}],"Net Margins":[{"time":"2014-12-30","value":0.006218598656020824},{"time":"2015-12-30","value":0.04885066003538334},{"time":"2016-12-30","value":0.04165935106291419},{"time":"2017-12-30","value":0.08295432012111636},{"time":"2018-12-30","value":0.0565175868795583},{"time":"2019-12-30","value":0.07278437236697545},{"time":"2020-12-30","value":0.09088283533931461},{"time":"2021-12-30","value":0.09294227221734108},{"time":"2022-12-30","value":0.11100367677006451},{"time":"2023-12-30","value":0.11824642606474992}],"Assets":[{"time":"2014-12-30","value":1476430000},{"time":"2015-12-30","value":1642249000},{"time":"2016-12-30","value":1690119000},{"time":"2017-12-30","value":1749549000},{"time":"2018-12-30","value":2454531000},{"time":"2019-12-30","value":2603963000},{"time":"2020-12-30","value":2815283000},{"time":"2021-12-30","value":4258530000},{"time":"2022-12-30","value":4606831000},{"time":"2023-12-30","value":5162851000}],"Stockholders Equity":[{"time":"2014-12-30","value":952290000},{"time":"2015-12-30","value":915729000},{"time":"2016-12-30","value":972547000},{"time":"2017-12-30","value":996519000},{"time":"2018-12-30","value":1072098000},{"time":"2019-12-30","value":1152889000},{"time":"2020-12-30","value":1348794000},{"time":"2021-12-30","value":1636434000},{"time":"2022-12-30","value":1929706000},{"time":"2023-12-30","value":2563655000}],"ROE":[{"time":"2014-12-30","value":0.009874092975879196},{"time":"2015-12-30","value":0.08623839585728965},{"time":"2016-12-30","value":0.07465551793383765},{"time":"2017-12-30","value":0.1586853838210812},{"time":"2018-12-30","value":0.1256900022199463},{"time":"2019-12-30","value":0.1656664258224339},{"time":"2020-12-30","value":0.18314360829007245},{"time":"2021-12-30","value":0.19800126372343768},{"time":"2022-12-30","value":0.2881210920212716},{"time":"2023-12-30","value":0.2396008823340114}],"ROA":[{"time":"2014-12-30","value":0.027578009116585277},{"time":"2015-12-30","value":0.05086378496805296},{"time":"2016-12-30","value":0.07194996328660881},{"time":"2017-12-30","value":0.07822816051450975},{"time":"2018-12-30","value":0.08512950131817443},{"time":"2019-12-30","value":0.11118552759774236},{"time":"2020-12-30","value":0.12611378678449023},{"time":"2021-12-30","value":0.1118740504352441},{"time":"2022-12-30","value":0.1730395579955071},{"time":"2023-12-30","value":0.17022087214990322}]}

TopBuild Corp., together with its subsidiaries, engages in the installation and distribution of insulation and other building material products to the construction industry. The company operates in two segments, Installation and Specialty Distribution. It provides insulation products and accessories, glass and windows, rain gutters, afterpaint products, fireproofing products, garage doors, fireplaces, closet shelving, roofing materials, and other products; and insulation installation services. The company also offers various services and tools to assist builders in applying the principles of building science to new home construction, which include pre-construction plan reviews, diagnostic testing, and various inspection services; and home energy rating services. In addition, it distributes building and mechanical insulation, insulation accessories, and other building product materials for the residential, commercial, and industrial end markets. The company serves single-family homebuilders, single-family custom builders, multi-family builders, commercial general contractors, remodelers, and individual homeowners, as well as insulation contractors, gutter contractors, weatherization contractors, other contractors, dealers, metal building erectors, and modular home builders. It operates approximately 230 installation branches and 180 distribution centers in the United States and Canada. The company was formerly known as Masco SpinCo Corp. and changed its name to TopBuild Corp. in March 2015. TopBuild Corp. was incorporated in 2015 and is headquartered in Daytona Beach, Florida.

Sector

10-Q
9/30/23
10-Q
6/30/23
10-Q
3/31/23
10-K
12/31/22
10-Q
9/30/22
10-Q
6/30/22
10-Q
3/31/22
10-K
12/31/21
10-Q
9/30/21
10-Q
6/30/21
10-Q
3/31/21
10-K
12/31/20
10-Q
9/30/20
10-Q
6/30/20
10-Q
3/31/20
10-K
12/31/19
10-Q
9/30/19
10-Q
6/30/19
10-Q
3/31/19
10-K
12/31/18
10-Q
9/30/18
10-Q
6/30/18
10-Q
3/31/18
10-K
12/31/17

DCF

Discounted Cash Flow Valuation of Topbuild Corp

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$790.1M	$1.027B	$1.307B	$1.626B	$1.978B	$2.352B	$2.731B	$3.095B	$3.422B	$3.688B	$3.873B	$38.73B
DCF		$893.1M	$988.1M	$1.069B	$1.131B	$1.169B	$1.181B	$1.164B	$1.119B	$1.048B	$957.2M	$9.572B
Value	$20.29B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 37%

Earnings Stability 86%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Over time the ROA has been increasing indicating a higher marginal ROA with respect to the calculated one, giving a good sign for continued growth.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	4.9%	4.2%	8.3%	5.7%	7.3%	9.1%	9.3%	11%	12%	12%
ROA	5.1%	7.2%	7.8%	8.5%	11%	13%	11%	17%	17%	17%
ROE	8.6%	7.5%	16%	13%	17%	18%	20%	29%	24%	23%

What is the average Net Margin?

The average Net Margin over the past 5 years is +9.04%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is +1.22%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +12.96%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is +1.71%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is +20%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is +2.72%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

Under the assumption that FCF does not diminish and debt does not increase, the current years to repay the debt are acceptable.

The Graham’s stability indicate reliability of earnings, and consideration about the future are more dependable.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	4.96	3.19	2.92	6.79	3.42	2.33	4.47	3.61	1.89	1.86
Debt Equity	0.23	0.21	0.26	0.73	0.67	0.55	0.95	0.78	0.58	0.54
MIN
Graham Stability	-	-	100%	100%	100%	100%	100%	100%	100%	100%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 1.86.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is -0.62.

What is the Graham’s Stability?

Graham’s Stability measure stands at 1.00.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has not been increasing in the past years.

Years	12-2016	12-2018	12-2020	12-2022	Trend
Revenue	17%	17%	24%	3.7%	1.9%
Net Income	36%	35%	35%	10%	-47%
Stockholders Equity	15%	19%	24%	33%	3.8%
FCF	44%	47%	35%	87%	5.5%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +16.85%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +1.85%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +35.44%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -46.79%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +19.05%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is +3.82%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +46.94%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +5.46%.