BLDR
Builders FirstSource, Inc.$99.41
Buy
Target $157.21
Report: Mar 07, 2026Industrials • Construction • Cyclical OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$99.41+58.1%
Rec: BuyConviction: Medium
Entry Target
$99.41
(0% above current)
Fair Value
$157.21
(58% above current)
Stop Loss
$78.00
(22% below current)
Position Size
Half
Time Horizon
Transitional
Key Metrics
Live Snapshot
Market Data
52 Week High$151.03
52 Week Low$78.55
Avg. 3 Month Volume2.31M
Efficiency
LTM Gross Margin30.4%
LTM EBITDA Margin9.1%
LTM EBIT Margin5.2%
LTM Operating Margin5.2%
LTM ROA3.8%
LTM ROE10.1%
LTM ROIC8.4%
LTM ROCE8.3%
Capital Structure
Market Cap (MM)$9.1B
Enterprise Value (MM)$14.0B
Shares Outstanding110.58M
Total Debt (MM)$5.10B
Cash & Equivalents (MM)$181.75M
LTM Net Debt (MM)$4.92B
LTM Net Debt/EBITDA3.6x
Growth
TTM Rev. Growth-7.4%
Last 3-Yr Rev. CAGR-12.6%
Last 3-Yr EBITDA CAGR-31.4%
Last 3-Yr EPS CAGR-38.6%
Valuation
Street Target Price$122.49
LTM EV/Revenue0.9x
LTM EV/Gross Profit3.0x
LTM EV/EBIT17.8x
LTM EV/EBITDA10.2x
LTM P/E20.9x
LTM EV/FCF16.0x
LTM P/FCF10.4x
LTM P/TB1.5x
LTM P/B2.1x
Dividend Yield0.0%
Payout Ratio0.0%
Executive SummarySituation: Current price is $99.41 versus fair value $157.21 (58.1% expected return), and valuation confidence is stable. Debate: Bull case depends on Inflection in Single-Family Starts A reversal in the 15% decline in single-family starts would validate the mean-reversion thesis and trigger significant operating leverage. Bear case centers on Lower-for-Longer Housing Downturn A prolonged period of high interest rates could suppress housing starts beyond our 18-month recovery window, leading to sustained margin compression below 5%. Conclusion: Recommendation is Buy with Half sizing and Transitional horizon.
Bull Case
A structural housing shortage in the U.S. drives a multi-year recovery in starts, while the digital platform scales to $8B+ in quotes, expanding margins toward the 10.5% mid-cycle target. Continued share cannibalization at trough multiples significantly accrues value to remaining shareholders.
Bear Case
A 'lower-for-longer' housing market persists due to affordability challenges, leading to further margin compression and a breach of the 2.9x interest coverage ratio. High leverage (117% debt-to-equity) limits the company's ability to survive a prolonged downturn without dilutive capital raises.
Key Catalysts
Mid-Term (6-18 months)Impact: Critical
Inflection in Single-Family Starts A reversal in the 15% decline in single-family starts would validate the mean-reversion thesis and trigge...
Near-Term (0-6 months)Impact: High
Digital Platform Scaling Digital platform sales exceeding $8B would prove the company's ability to drive higher-margin, 'sticky' revenue thr...
Long-Term (18+ months)Impact: Moderate
Builders FirstSource is at a critical juncture as it trades near its 52-week low of $94.35 while insiders have just completed a $53.5M buyin...
Primary Risks
Concern: Medium
Lower-for-Longer Housing Downturn A prolonged period of high interest rates could suppress housing starts beyond our 18-month recovery windo...
Concern: High
Balance Sheet Leverage Net debt has risen to $4.9B, pushing debt-to-equity to 117.2%. A further decline in EBITDA could breach the 1.0x fixe...
Concern: Medium
The stewardship verdict is positive, as the board is heavily aligned with shareholders through significant personal capital commitments. The...
Recent Activity
2026-01-09Analyst Target
+12.01%Firm: RBC Capital Analyst: Mike Dahl Price Target: $111.00 Price When Posted: $111.29 Implied Downside: -0.3%
2025-05-01SEC Filing (8-K)
-6.44%Builders FirstSource released its 2025 Corporate Social Responsibility report highlighting sustainability achievements
2024-05-07SEC Filing (8-K)
-19.05%Builders FirstSource reported Q1 2024 results and reaffirmed 2024 guidance
2023-11-01SEC Filing (8-K)
+8.25%Builders FirstSource reported Q3 2023 results with $4.5B net sales, down 21.3% YoY, and updated 2023 guidance.
2023-05-03SEC Filing (8-K)
+12.88%Builders FirstSource reported Q1 2023 results with strong share repurchases
Valuation Table
9.7/10Decision Grade
Scenario Range
$2
Bear
$100
Base
$275
Bull
$99