Financial Data and Key Metrics Changes - In Q4 2025, the company reported net sales of $645 million, a 3.5% decrease from $667.7 million in Q4 2024 [5][20] - Adjusted EBITDA for Q4 was $35 million, down from $75 million in the prior year, with an adjusted EBITDA margin of 5.4% [6][24] - Full-year 2025 net sales were $2.7 billion, up 1% year-over-year, driven by contributions from Supreme and pricing improvements [25][26] - Net income for Q4 was a loss of $42 million compared to a profit of $14 million in Q4 2024, resulting in a net income margin of -6.5% [23][27] - Full-year adjusted EBITDA was $298.2 million, down 18% from $363.6 million in 2024, with an adjusted EBITDA margin of 10.9% [28] Business Line Data and Key Metrics Changes - The U.S. single-family new construction market declined high single digits in Q4 and mid-single digits for the full year, with MasterBrand's new construction sales outperforming the broader market [8][9] - In the repair and remodel segment, the U.S. cabinet R&R market declined mid-single digits in both Q4 and the full year, driven by low existing home turnover [9][10] - The Canadian market also faced mid-single-digit declines in both new construction and R&R demand [10] Market Data and Key Metrics Changes - 2025 marked the third consecutive year of market contraction, influenced by elevated interest rates and lower consumer confidence [8] - The company expects continued headwinds in the new construction market into 2026, with demand closely tied to financing conditions and consumer sentiment [9][11] - The anticipated Canadian market conditions for 2026 remain pressured due to similar affordability and turnover dynamics [10] Company Strategy and Development Direction - The company is focused on maintaining financial flexibility through targeted cash management and cost reductions, with $30 million in planned cost reductions for 2026 [12][34] - MasterBrand aims to capture synergies from the Supreme integration and the pending American Woodmark transaction, expecting approximately $90 million in run-rate cost synergies post-close [17][29] - The company is implementing a coordinated mitigation strategy to manage tariff impacts, including sourcing flexibility and operational adjustments [15][32] Management Comments on Operating Environment and Future Outlook - Management noted ongoing demand pressure and a complex trade backdrop, with expectations for a transitional year in 2026 as market trends persist [5][40] - The company anticipates a modest recovery in 2027, supported by improving affordability and easing financing conditions [12][42] - Management emphasized the importance of disciplined execution and cash generation to navigate the current environment [41][36] Other Important Information - The company ended 2025 with $183.3 million in cash and $441.9 million in liquidity available under its revolving credit facility [29][30] - Tariffs continue to pressure costs, with a 25% tariff on cabinets and related products expected to remain in place throughout 2026 [14][31] - The company expects to fully offset tariff costs on a run-rate basis by the end of 2026 through mitigation initiatives [37][38] Q&A Session Summary Question: Can you break down the full-year market outlook by end channel? - Management indicated that both the builder and R&R markets are expected to decline mid-single digits, with uncertainty around the spring season influencing guidance [46] Question: What drove the sequential deceleration in price realization? - Management attributed the deceleration to a mix shift towards lower price point products and the timing of price adjustments to mitigate tariffs [47][48] Question: Can you provide more detail on the residential construction weakness? - Management noted a significant drop-off in late November, similar to the prior year, impacting overall volume and factory efficiency [52] Question: What are the details on the $30 million in expected savings for 2026? - Management clarified that the $30 million represents annualized savings expected throughout the year, primarily from structural cost adjustments [53] Question: How confident is the company in offsetting tariff costs? - Management expressed confidence in their long-term strategy to cover tariff costs, though timing remains uncertain due to the dynamic pricing environment [54][55]

Core Insights - Fortune Brands Innovations (FBIN) reported quarterly earnings of $1.09 per share, missing the Zacks Consensus Estimate of $1.1 per share, and down from $1.16 per share a year ago [1][2] - The company posted revenues of $1.15 billion for the quarter ended September 2025, which was 2.43% below the Zacks Consensus Estimate and a slight decrease from $1.16 billion year-over-year [3] - The stock has underperformed significantly, losing about 27.2% since the beginning of the year compared to a 17.2% gain in the S&P 500 [4] Earnings Performance - The earnings surprise for the recent quarter was -0.91%, while the previous quarter saw a positive surprise of +2.04% [2] - Over the last four quarters, the company has only surpassed consensus EPS estimates once [2][3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $1.04 on revenues of $1.12 billion, and for the current fiscal year, it is $3.78 on revenues of $4.54 billion [8] - The estimate revisions trend for Fortune Brands Innovations was unfavorable prior to the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [7] Industry Context - Fortune Brands Innovations operates within the Zacks Building Products - Air Conditioner and Heating industry, which is currently ranked in the bottom 16% of over 250 Zacks industries [9] - The performance of the stock may be influenced by the overall outlook for the industry, as top-ranked industries tend to outperform the bottom-ranked ones by a significant margin [9]

Core Insights - Watsco reported quarterly earnings of $3.98 per share, missing the Zacks Consensus Estimate of $4.21 per share, and down from $4.22 per share a year ago, representing an earnings surprise of -5.46% [1] - The company posted revenues of $2.07 billion for the quarter, missing the Zacks Consensus Estimate by 2.21%, and down from $2.16 billion year-over-year [2] - Watsco shares have declined approximately 24.4% year-to-date, contrasting with the S&P 500's gain of 17.2% [3] Earnings Outlook - The future performance of Watsco's stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [4] - The current consensus EPS estimate for the upcoming quarter is $2.29 on revenues of $1.71 billion, and for the current fiscal year, it is $13.13 on revenues of $7.41 billion [7] Industry Context - The Building Products - Air Conditioner and Heating industry, to which Watsco belongs, is currently ranked in the bottom 20% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Watsco's stock performance [5][6]

Core Viewpoint - Wall Street anticipates a year-over-year decline in earnings for Fortune Brands Innovations (FBIN) despite higher revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The upcoming earnings report is expected to show earnings of $1.10 per share, reflecting a -5.2% change year-over-year, while revenues are projected at $1.18 billion, a 2% increase from the previous year [3]. - The consensus EPS estimate has been revised down by 0.55% over the last 30 days, indicating a bearish sentiment among analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for FBIN is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -0.02% [12]. - The stock currently holds a Zacks Rank of 4, suggesting a sell rating, which complicates the prediction of an earnings beat [12]. Historical Performance - In the last reported quarter, FBIN exceeded the expected earnings of $0.98 per share by delivering $1.00, resulting in a surprise of +2.04% [13]. - Over the past four quarters, the company has beaten consensus EPS estimates twice [14]. Industry Comparison - Another company in the same industry, Watsco (WSO), is expected to report earnings of $4.21 per share, reflecting a -0.2% year-over-year change, with revenues anticipated at $2.11 billion, down 2.2% from the previous year [18][19]. - Watsco's consensus EPS estimate has been revised down by 11.7% in the last 30 days, leading to an Earnings ESP of -5.53% and a Zacks Rank of 4 [19][20].

Company Performance - Fortune Brands Innovations (FBIN) reported quarterly earnings of $1 per share, exceeding the Zacks Consensus Estimate of $0.98 per share, but down from $1.16 per share a year ago [1] - The quarterly earnings surprise was +2.04%, and the company had previously met expectations with earnings of $0.66 per share [2] - The company posted revenues of $1.2 billion for the quarter, surpassing the Zacks Consensus Estimate by 0.62%, but down from $1.24 billion year-over-year [3] Stock Performance - Fortune Brands Innovations shares have declined approximately 20.3% since the beginning of the year, contrasting with the S&P 500's gain of 8.2% [4] - The current Zacks Rank for the stock is 3 (Hold), indicating expected performance in line with the market in the near future [7] Future Outlook - The consensus EPS estimate for the upcoming quarter is $1.12 on revenues of $1.15 billion, and for the current fiscal year, it is $3.78 on revenues of $4.49 billion [8] - The outlook for the Retail - Home Furnishings industry, where Fortune Brands operates, is currently in the top 39% of over 250 Zacks industries, suggesting a favorable environment for performance [9]

Core Viewpoint - The market anticipates a year-over-year decline in earnings for Fortune Brands Innovations (FBIN) due to lower revenues, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The upcoming earnings report is expected to show quarterly earnings of $0.97 per share, reflecting a -16.4% change year-over-year, with revenues projected at $1.19 billion, down 3.7% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analyst assessments [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates a positive Earnings ESP of +1.22% for Fortune Brands Innovations, suggesting a likelihood of beating the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, the company met the expected earnings of $0.66 per share, resulting in no surprise, and has beaten consensus EPS estimates in two out of the last four quarters [13][14]. Conclusion - Fortune Brands Innovations is viewed as a strong candidate for an earnings beat, but investors should consider additional factors before making investment decisions [17].

Acquisition Overview - MEC will acquire Accu-Fab for $140.5 million, plus customary adjustments, funded through MEC's existing $250 million Credit Facility[8] - The transaction is expected to close in 3Q25, subject to customary closing conditions[8] - Accu-Fab's 2024 Adjusted EBITDA margin was approximately 23%, with net sales growth exceeding 20%[9] - MEC plans to retain all approximately 250 Accu-Fab employees[9,14] Strategic Rationale - Accu-Fab diversifies MEC's revenue into higher-value, emerging end-markets like critical power infrastructure, data centers, and renewable energy[6,8] - Accu-Fab's premium markets drive increased margins and over 50% FCF conversion[11] - Identified $4-$6 million in potential annual revenue and cost synergies over the next 24 months[9] - Accretive profitability, synergies, and growth trajectory support an IRR of approximately 15%[11] Financial Impact - Accu-Fab's revenue was approximately $61 million in FY2024 with Adjusted EBITDA of approximately $14 million[14] - Pro-forma combined annual sales are approximately $643 million with Adjusted EBITDA of approximately $78 million[25] - Expects pro-forma, TTM net leverage of approximately 3.0x at closing[9]

Group 1 - Fortune Brands Innovations (FBIN) reported quarterly earnings of $0.66 per share, matching the Zacks Consensus Estimate, but down from $0.83 per share a year ago [1] - The company posted revenues of $1.03 billion for the quarter ended March 2025, missing the Zacks Consensus Estimate by 3.39%, and down from $1.11 billion year-over-year [2] - Over the last four quarters, the company has surpassed consensus EPS estimates two times, but has not beaten consensus revenue estimates [2] Group 2 - The stock has declined approximately 20.5% since the beginning of the year, compared to a decline of 3.9% for the S&P 500 [3] - The current consensus EPS estimate for the upcoming quarter is $1.12 on revenues of $1.25 billion, and for the current fiscal year, it is $4.11 on revenues of $4.66 billion [7] - The Zacks Industry Rank for Retail - Home Furnishings is currently in the bottom 15% of over 250 Zacks industries, indicating potential underperformance compared to higher-ranked industries [8]