Investment management company Curreen Capital released its fourth-quarter 2025 Investor letter. A copy of the letter can be downloaded here. Curreen Capital Partners reported robust results in 2025, retuning 10.5% in Q4 and 30.97% for the full year. The firm focuses on investing in "ugly ducklings", i.e., companies that are good, well-managed, and trading at an attractive price. The firm was consistent with its investment plan, and the "ugly duckling" holdings performed well and exhibited solid results. Pl ...

MEMPHIS, Tenn.--(BUSINESS WIRE)--Frontdoor, Inc. (NASDAQ: FTDR), the nation's leading provider of home warranties, today announced it will release its fourth-quarter and full-year 2025 financial results and hold a conference call on Thursday, Feb. 26, 2026 at 7:30 a.m. Central time (8:30 a.m. Eastern time). Participants can register for the webcast by clicking https://www.webcaster5.com/Webcast/Page/3067/53543, which will include a slide presentation highlighting the company's results. Once completed, each ...

Core Insights - Frontdoor, Inc. (FTDR) is experiencing growth driven by the 2-10 acquisition and operational improvements, with strong performance in the non-warranty segment and favorable trends in the real estate channel [1][5][10] Financial Performance - FTDR shares have increased by 2.1% over the past year, outperforming the Zacks Building Products - Miscellaneous industry's decline of 1.7% [2] - The company has consistently exceeded earnings estimates, averaging a 59.4% beat over the last four quarters [2] - The 2026 EPS estimate has been revised upward to $4.05 from $3.99 [3] Revenue Growth - Renewal revenues increased by 9%, aided by the 2-10 acquisition and improved pricing strategies [5][9] - The real estate channel saw a 21% revenue increase, marking a significant recovery milestone [5][9] - Direct-to-consumer revenues grew by 11%, driven by targeted marketing and promotional pricing [8] - Non-warranty revenues surged by 73% year over year, primarily due to the new HVAC program [8] Acquisition Impact - The 2-10 acquisition significantly contributed to revenue growth, with $47 million in favorable revenue conversion [9] - Total revenues for 2025 are expected to grow by 13%, with approximately 10% attributed to the acquisition [9] - The acquisition enhances Frontdoor's market reach and competitive positioning [10] Margin Expansion - Gross profit margin expanded by 60 basis points year over year, with adjusted EBITDA margin improving to 32% [11] - The company narrowed its full-year 2025 gross profit margin outlook to approximately 55.5% and raised adjusted EBITDA guidance to $545 million to $550 million [11] Return on Equity - Frontdoor's trailing 12-month return on equity (ROE) stands at 122.7%, significantly higher than the industry average of 14.7% [12]

Industry Overview - The Zacks Building Products - Miscellaneous industry is under pressure from tariffs, high input and labor costs, and persistent inflation, leading to slowed commercial activity and challenges in housing affordability [1][4][6] - Supply-chain disruptions and high energy expenses are contributing to these challenges, with mortgage rates remaining above 6%, which dampens demand for new construction [1][6] Long-term Prospects - Despite current challenges, long-term prospects are positive due to federal investments in infrastructure and global supply-chain reinvestment, which provide a strong growth backdrop [2][7] - Companies are focusing on efficiency through cost-saving initiatives, digital solutions, and acquisitions to capitalize on these trends [2][9] Key Trends - Tariff policies are reshaping the industry by increasing costs and disrupting supply chains, which is expected to slow commercial construction activity [4] - Rising costs related to transportation, materials, and labor are compressing margins and affecting operating performance [5] Market Performance - The Zacks Building Products - Miscellaneous industry has underperformed the broader Zacks S&P 500 Composite and the Zacks Construction sector over the past year, gaining only 4.7% compared to the sector's 7.8% and the S&P 500's 22.1% [10][14] - The industry's Zacks Industry Rank is 159, placing it in the bottom 35% of over 250 Zacks industries, indicating bleak near-term prospects [10][11] Earnings Outlook - Analysts have reduced the earnings estimates for the industry, with projections for 2026 decreasing from $4.67 to $4.50 per share [12] - The industry's earnings outlook is closely tied to the U.S. housing and renovation markets, which are facing challenges due to high mortgage rates and supply constraints [6] Company Highlights - **Argan, Inc. (AGX)**: Positioned for growth in power and renewable energy projects, with a 79% gain over the past year and upward earnings estimate revisions indicating strong future growth [20][21] - **Installed Building Products, Inc. (IBP)**: A leading installer of residential insulation, with a 60.3% gain over the past year and a focus on operational efficiency and market resilience [26][27] - **Frontdoor, Inc. (FTDR)**: Offers home warranties and is benefiting from a scalable platform, with a 6.6% gain over the past year and increasing earnings estimates [30][32] - **Gibraltar Industries, Inc. (ROCK)**: Focused on residential building products, with a long-term constructive outlook despite a 9.6% loss over the past year, and upward earnings estimate revisions [35][36]

Core Insights - Frontdoor, Inc. reported a 14% year-over-year increase in revenues for Q3 2025, with net profit rising 5% year-over-year to $106 million [1] - For the nine months ending September 30, 2025, Frontdoor's revenue experienced a significant growth of 45% year-over-year since Q1 2025 [1] Financial Performance - Q3 2025 revenues increased by 14% compared to the same quarter last year [1] - Net profit for Q3 2025 reached $106 million, reflecting a 5% increase year-over-year [1] - Year-to-date revenue growth for the first nine months of 2025 was 45% compared to the same period in the previous year [1]

Core Insights - Frontdoor (FTDR) has experienced a significant stock decline of 21.8%, dropping from $68.84 on October 27, 2025, to approximately $53.84 [2] - The potential for a rebound towards $70 is considered meaningful, given the company's historical performance after sharp dips [2] - Historically, after notable declines, FTDR has delivered a median 12-month return of 59% and a median peak rebound of 75% [2][8] Historical Performance - FTDR has encountered four events since January 1, 2010, where the stock experienced a dip of 30% or more within 30 days [4] - The median duration to peak return following a dip event is 306 days [8] - The median maximum drawdown within one year of a dip event is -5.6% [8] Financial Quality Assessment - To evaluate the likelihood of a dip indicating a declining business, it is essential to review revenue growth, profitability, cash flow, and balance sheet robustness [5]

Core Insights - The article discusses the importance of enabling Javascript and cookies in browsers to ensure proper functionality and access to content [1] Group 1 - The article emphasizes that users may face access issues if ad-blockers are enabled, suggesting the need to disable them for a better experience [1]

Summary of Frontdoor FY Conference Call (November 18, 2025) Company Overview - **Company**: Frontdoor (NasdaqGS:FTDR) - **Industry**: Home Warranty Services - **Business Model**: Frontdoor operates a recurring revenue model through home warranties, covering 29 systems and appliances with over 2 million members and 17,000 contractors. The service is initiated via a call or app, with a trade service fee charged for repairs or replacements [9][10]. Key Points Market Dynamics - **Total Addressable Market (TAM)**: The home services market is approximately $500 billion, with an addressable market for home warranties estimated at 15 million homes in the U.S. Currently, about 5 million home warranties are sold, with Frontdoor holding a 40% market share [11][12]. - **Impact of COVID-19**: The pandemic shifted the market dynamics, affecting the traditional real estate channel, which has seen a decline in transactions [11][12]. Real Estate Channel - **Current Trends**: Existing home sales are at a cyclical trough, with inventory increasing but still low. Frontdoor targets about 200,000-210,000 units this year, down from nearly 500,000 six years ago [13][15]. - **Growth Strategy**: The company is enhancing its sales force and introducing promotional pricing to attract real estate agents and customers [16][17]. Direct-to-Consumer (DTC) Channel - **Performance**: The DTC business has shown strong growth, particularly among millennials and Hispanic demographics. The advertising campaign has improved brand relevance and customer engagement [19][20]. - **Future Outlook**: The company anticipates positive growth in customer accounts by 2026, driven by both DTC and real estate channels [23][25]. Retention and Renewal Rates - **Improvement in Retention**: Retention rates have improved by 300 basis points due to better contractor performance and initiatives like autopay and auto-renewal [31][34]. - **Operational Execution**: Focus on member experience and operational discipline has been key to maintaining retention rates and managing cancellations [35][36]. Revenue Growth and Margins - **Revenue Projections**: The company expects 3% organic revenue growth this year, with further expansion anticipated in 2026 and 2027 [40][41]. - **Margin Management**: Frontdoor has achieved record margins through dynamic pricing strategies and strong contractor relationships, managing inflation effectively [65][66]. Non-Warranty Business Expansion - **New Offerings**: The company is expanding into non-warranty services, starting with HVAC and planning to include appliances, roofs, and water heaters by 2026. This strategy aims to increase share of wallet among existing members [45][50]. - **Contractor Relationships**: Strong relationships with contractors allow for competitive pricing and improved customer satisfaction [58][59]. Capital Allocation and M&A Strategy - **Focus on Growth**: The company aims to maintain a strong balance sheet while considering share repurchases and potential M&A opportunities, particularly focusing on integrating the recently acquired 2-10 business [83][89]. AI and Technology Integration - **AI Utilization**: Frontdoor is leveraging AI to enhance service request processing and sales interactions, improving efficiency and customer experience [95][106]. Additional Insights - **Market Recovery**: A recovery in the real estate market could positively impact revenue but may also introduce inflationary pressures [73][74]. - **Long-term Strategy**: The company is focused on sustainable growth through operational excellence, customer retention, and strategic pricing [72][71].

Core Insights - Frontdoor, Inc. has been recognized for its leadership in the home warranty industry with Kathy Collins receiving a Silver Stevie Award for "Female Executive of the Year – Consumer Services – 11 to 2,500 Employees" [1] Company Recognition - Kathy Collins, Senior Vice President and Chief Revenue Officer of Frontdoor, was honored at the Stevie Awards for Women in Business held on November 10 in New York City [1] - The Stevie Awards, established in 2002, celebrate the achievements of women in business [1]

Core Viewpoint - Frontdoor (NASDAQ: FTDR) has experienced a significant stock price drop of 16%, now trading at $55, raising concerns about its durability in changing economic cycles despite its operational strength and profitability [1][12]. Company Overview - Frontdoor operates with a market capitalization of approximately $4 billion, providing home warranty services, on-demand repairs, and technology-driven diagnostics using AI and computer vision [2]. - The company has a commendable operational history, but its market performance suggests underlying issues [2]. Financial Performance - Frontdoor's operating margin stands at 19.5%, net margin at 13.1%, and cash flow margin at 17%, with a debt-to-equity ratio of 25.2% and a cash-to-assets ratio of 25.9% [7]. - The stock has shown significant volatility, dropping 66% during the inflation shock of 2022, compared to a 25% decline in the S&P 500 [5][8]. Market Sensitivity - The company's operations are closely tied to U.S. housing activity, making it vulnerable to downturns in home transactions and consumer spending [9]. - Historical data indicates that during market corrections, FTDR's stock has dropped by 60-65% from its peaks, suggesting potential downside risks if economic conditions worsen [10][11]. Growth Prospects - Frontdoor's average annual growth rate is 6%, with 8.7% revenue growth over the trailing twelve months, which is only in line with market growth and does not justify premium pricing [14]. - The company lacks a compelling growth narrative compared to technology-focused firms, which may limit its appeal to investors [9]. Investor Sentiment - Recent stock performance reflects how quickly investor sentiment can shift, as evidenced by the recent 16% decline [9]. - Despite solid balance sheet indicators, FTDR's stock has shown weak resilience during downturns, making it sensitive to changes in housing market conditions [14].