Benchmark has lowered the price target for Janus International Group, Inc. (NYSE: JBI) to $14 from the previous target of $21, while still recommending the stock as a Buy. The firm's decision came after the company reported disappointing financial results earlier in the week.
Janus International Group, a manufacturer of turnkey building solutions and new technology for the self-storage industry, experienced a significant downturn in its conversion and new construction end markets.
This was attributed to the impact of high interest rates, stricter lending requirements, and the anticipation of rate cuts, which led to numerous backlogged projects being delayed.
The company also faces ongoing pricing pressures due to the cost of steel, which is now expected to extend into fiscal year 2025. As a result, Janus International's management has revised its full-year revenue and EBITDA forecasts downward, by approximately $88 million and $33 million at their respective midpoints.
Benchmark has adjusted its earnings per share (EPS) estimates for Janus International for the current year and the following year to $0.85 and $0.70, a decrease from the previous estimates of $1.00 and $1.15.
Janus reported a 1% increase in its first quarter 2024 earnings, with consolidated revenue reaching $254.5 million. The company's adjusted EBITDA and net income saw increases of 8.3% and 17.8% respectively. Moreover, Janus International Group announced the acquisition of Terminal Maintenance and Construction (TMC), a firm specializing in trucking terminal services, expected to enhance the company's project management capabilities.
In addition, Janus launched two new roll-up door products, the NS+ Door and the NS Retrokit, aimed at enhancing security for self-storage facilities. These products are part of the company's R3 Program, which focuses on renovating storage units and enhancing security measures. The company also introduced the Nokē Ion, a new addition to its smart locking system line.
These recent developments signify steady growth and strategic expansion for Janus International Group. The company anticipates 2024 revenue between $1.092 billion and $1.125 billion and adjusted EBITDA between $286 million and $310 million.
InvestingPro Insights
In light of Benchmark's revised outlook for Janus International Group, Inc. (NYSE:JBI), recent data from InvestingPro provides additional context for investors considering the stock. The company's market capitalization stands at $1.53 billion, with a P/E ratio of 11.74, slightly lowered to 11.11 when adjusted for the last twelve months as of Q2 2024. Despite recent challenges, the stock's price has been deemed undervalued by InvestingPro, with a fair value estimate of $16.91, higher than the current price of $10.51.
InvestingPro Tips suggest caution, as the stock is currently in oversold territory according to the RSI, and analysts have revised their earnings downwards for the upcoming period. On the positive side, the company's liquid assets exceed short-term obligations, indicating some financial resilience. For investors seeking a deeper dive into Janus International's performance and outlook, InvestingPro offers additional tips and metrics to aid in their investment decisions.
It's also noteworthy that Janus International Group has been profitable over the last twelve months, and analysts predict the company will remain profitable this year. While the stock has taken significant hits over various time frames, the current valuation may present an opportunity for investors who believe in the company's long-term fundamentals. For those interested, there are 11 additional InvestingPro Tips available for Janus International Group, providing further insights into the stock's potential.
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