Gibraltar Industries Stock To $62?
Gibraltar Industries (ROCK) stock has fallen 20% during the past day, and is currently trading at $47.14. Our multi-factor assessment suggests that it may be time to buy more shares of ROCK stock. We have, overall, a positive view of the stock, and a price of $62 may not be out of reach. We believe there is a near-equal mix of good and bad in ROCK stock given its overall Moderate operating performance and financial condition. Taken together with its Very Low valuation, this makes the stock look Attractive.
Below is our assessment:
| CONCLUSION | |
|---|---|
| What you pay: | |
| Valuation | Very Low |
| What you get: | |
| Growth | Strong |
| Profitability | Weak |
| Financial Stability | Strong |
| Downturn Resilience | Very Weak |
| Operating Performance | Moderate |
| Stock Opinion | Attractive |
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Let’s get into details of each of the assessed factors but before that, for quick background: With $1.4 Bil in market cap, Gibraltar Industries provides building products and solutions for renewable energy, residential ventilation, agtech greenhouses, and infrastructure, including solar racking, roof ventilation, and agricultural processing systems.
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[1] Valuation Looks Very Low
| ROCK | S&P 500 | |
|---|---|---|
| Price-to-Sales Ratio | 1.0 | 3.1 |
| Price-to-Earnings Ratio | 337.3 | 23.4 |
| Price-to-Free Cash Flow Ratio | 13.4 | 20.0 |
This table highlights how ROCK is valued vs broader market. For more details see: ROCK Valuation Ratios
[2] Growth Is Strong
- Gibraltar Industries has seen its top line grow at an average rate of 1.5% over the last 3 years
- Its revenues have grown 22% from $1.2 Bil to $1.4 Bil in the last 12 months
- Also, its quarterly revenues grew 12.2% to $311 Mil in the most recent quarter from $277 Mil a year ago.
| ROCK | S&P 500 | |
|---|---|---|
| 3-Year Average | 1.5% | 5.5% |
| Latest Twelve Months* | 21.8% | 6.1% |
| Most Recent Quarter (YoY)* | 12.2% | 7.1% |
This table highlights how ROCK is growing vs broader market. For more details see: ROCK Revenue Comparison
[3] Profitability Appears Weak
- ROCK last 12 month operating income was $145 Mil representing operating margin of 10.2%
- With cash flow margin of 10.6%, it generated nearly $151 Mil in operating cash flow over this period
- For the same period, ROCK generated nearly $4.2 Mil in net income, suggesting net margin of about 0.3%
| ROCK | S&P 500 | |
|---|---|---|
| Current Operating Margin | 10.2% | 18.8% |
| Current OCF Margin | 10.6% | 20.5% |
| Current Net Income Margin | 0.3% | 13.1% |
This table highlights how ROCK profitability vs broader market. For more details see: ROCK Operating Income Comparison
[4] Financial Stability Looks Strong
- ROCK Debt was $48 Mil at the end of the most recent quarter, while its current Market Cap is $1.4 Bil. This implies Debt-to-Equity Ratio of 3.4%
- ROCK Cash (including cash equivalents) makes up $89 Mil of $1.4 Bil in total Assets. This yields a Cash-to-Assets Ratio of 6.2%
| ROCK | S&P 500 | |
|---|---|---|
| Current Debt-to-Equity Ratio | 3.4% | 21.0% |
| Current Cash-to-Assets Ratio | 6.2% | 7.0% |
[5] Downturn Resilience Is Very Weak
ROCK has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.
2022 Inflation Shock
- ROCK stock fell 63.2% from a high of $100.98 on 19 January 2021 to $37.13 on 27 September 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- The stock is yet to recover to its pre-Crisis high
- The highest the stock has reached since then is $87.18 on 15 February 2024 , and currently trades at $47.14
| ROCK | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -63.2% | -25.4% |
| Time to Full Recovery | Not Fully Recovered | 464 days |
2020 Covid Pandemic
- ROCK stock fell 44.0% from a high of $56.18 on 23 January 2020 to $31.45 on 18 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 5 August 2020
| ROCK | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -44.0% | -33.9% |
| Time to Full Recovery | 140 days | 148 days |
2008 Global Financial Crisis
- ROCK stock fell 85.4% from a high of $25.04 on 7 February 2007 to $3.65 on 12 March 2009 vs. a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 30 October 2015
| ROCK | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -85.4% | -56.8% |
| Time to Full Recovery | 2423 days | 1480 days |
But the risk is not limited to major market crashes. Stocks fall even when markets are good – think events like earnings, business updates, outlook changes. Read ROCK Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
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