Zacks Investment Research Downgrades NCI Building Systems (NCS) to Hold

NCI Building Systems (NYSE:NCS) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued to clients and investors on Wednesday.

According to Zacks, “NCI Building expects gross margins to improve in fiscal 2018 compared with the prior year due to cost-structure improvements. The company’s focus on growth strategy around insulated metal panels and investments in automation and process innovation will drive growth. It will also focus on continued improvement in manufacturing, and delivering further cost reductions with the Lean and Six Sigma initiatives across the entire business. However, charges related to cost restructuring and disposal of idle or non-core assets will impact NCI Building’s margins. Rising steel prices and fluctuation in dollar will also hurt its performance. Moreover, the company has underperformed the industry over the past year.”

A number of other brokerages have also commented on NCS. Royal Bank of Canada reiterated a “buy” rating and issued a $22.00 price target on shares of NCI Building Systems in a research note on Friday, December 8th. Barclays set a $21.00 price target on shares of NCI Building Systems and gave the stock a “buy” rating in a research note on Friday, December 8th. TheStreet upgraded shares of NCI Building Systems from a “c+” rating to a “b-” rating in a research note on Wednesday, December 27th. Citigroup reduced their price target on shares of NCI Building Systems from $21.00 to $20.00 and set a “neutral” rating for the company in a research note on Thursday, January 25th. Finally, DA Davidson reiterated a “hold” rating and issued a $18.00 price target on shares of NCI Building Systems in a research note on Friday, December 8th. One analyst has rated the stock with a sell rating, three have assigned a hold rating and two have assigned a buy rating to the stock. NCI Building Systems presently has a consensus rating of “Hold” and a consensus price target of $20.80.

Shares of NCI Building Systems (NYSE NCS) traded up $0.15 during mid-day trading on Wednesday, hitting $17.15. 143,308 shares of the stock were exchanged, compared to its average volume of 494,409. NCI Building Systems has a 52-week low of $13.05 and a 52-week high of $21.20. The company has a market capitalization of $1,140.97, a price-to-earnings ratio of 22.27, a PEG ratio of 1.58 and a beta of 1.52. The company has a debt-to-equity ratio of 1.27, a current ratio of 1.69 and a quick ratio of 1.06.

NCI Building Systems (NYSE:NCS) last announced its quarterly earnings results on Wednesday, December 6th. The construction company reported $0.32 EPS for the quarter, missing analysts’ consensus estimates of $0.42 by ($0.10). NCI Building Systems had a return on equity of 18.76% and a net margin of 3.08%. The company had revenue of $488.73 million during the quarter, compared to the consensus estimate of $477.13 million. During the same quarter in the prior year, the firm earned $0.28 earnings per share. The business’s revenue was up 1.8% compared to the same quarter last year. sell-side analysts forecast that NCI Building Systems will post 1.09 EPS for the current year.

NCI Building Systems announced that its Board of Directors has initiated a stock repurchase plan on Tuesday, October 10th that allows the company to buyback $50.00 million in shares. This buyback authorization allows the construction company to purchase shares of its stock through open market purchases. Stock buyback plans are usually a sign that the company’s management believes its stock is undervalued.

In related news, insider Norman C. Chambers sold 16,741 shares of the business’s stock in a transaction that occurred on Friday, December 15th. The shares were sold at an average price of $19.51, for a total transaction of $326,616.91. Following the completion of the sale, the insider now directly owns 471,503 shares in the company, valued at $9,199,023.53. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, major shareholder Dubilier & Rice Fund V. Clayton sold 7,150,000 shares of the business’s stock in a transaction that occurred on Wednesday, December 13th. The shares were sold at an average price of $19.36, for a total transaction of $138,424,000.00. The disclosure for this sale can be found here. Insiders have sold 7,296,115 shares of company stock valued at $141,263,459 over the last 90 days. 1.54% of the stock is currently owned by company insiders.

A number of hedge funds and other institutional investors have recently made changes to their positions in NCS. Legal & General Group Plc grew its position in NCI Building Systems by 41.0% during the second quarter. Legal & General Group Plc now owns 8,802 shares of the construction company’s stock valued at $147,000 after buying an additional 2,559 shares during the period. First Quadrant L P CA bought a new stake in NCI Building Systems during the third quarter valued at approximately $161,000. Victory Capital Management Inc. grew its position in NCI Building Systems by 54.9% during the third quarter. Victory Capital Management Inc. now owns 12,018 shares of the construction company’s stock valued at $187,000 after buying an additional 4,261 shares during the period. BB&T Securities LLC purchased a new position in NCI Building Systems during the third quarter valued at approximately $204,000. Finally, SG Americas Securities LLC purchased a new position in NCI Building Systems during the third quarter valued at approximately $215,000. Institutional investors own 95.23% of the company’s stock.

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NCI Building Systems Company Profile

NCI Building Systems, Inc is a manufacturer and marketer of metal products in North America. The Company’s operating segments include Engineered building systems, Metal components and Metal coil coating. The Engineered building systems segment is engaged in the manufacturing of main frames and long bay systems, and engineering and drafting.

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