Why Masco Shares Surged

Before you go, we thought you'd like these...
Before you go close icon

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of home-improvement and building products company Masco popped 15% today after its quarterly results topped Wall Street expectations.

So what: Masco's strong fourth-quarter results -- adjusted EPS of $0.04 on revenue growth of $14% -- reinforce recent optimism over a recovering U.S. housing market. In fact, sales and operating profits climbed in all five of Masco's business segments, the first time that has happened since the downturn, giving Wall Street plenty of confidence that the momentum will continue.


Now what: For 2013, management expects new home construction to grow at a strong pace, and repair/remodel to improve modestly. "We believe the actions we have taken over the past several years, including investing in our brands, reducing our cost structure and paying down debt, have strengthened our business," said President and CEO Tim Wadhams. "We believe these actions have positively positioned us to take advantage of the upturn in the housing cycle." Of course, with the stock hitting a new 52-week high today and up about 60% over the past six months alone, I'd wait for some of the excitement to fade before buying into that turnaround talk.

Interested in more info on Masco?Add it to your watchlist.

The article Why Masco Shares Surged originally appeared on Fool.com.

Fool contributor Brian Pacampara and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners