Will Gibraltar Industries' (ROCK) Inititiatives Drive Growth?

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We have issued an updated research report on the premium steel & iron firm Gibraltar Industries, Inc. ROCK on Aug 19, 2015. The company enjoys a leading position in the industry, thanks to its diversified product offering.

Bullish Factors

Gibraltar Industries intends to boost its financial fundamentals through its productive value-creation strategy. Under this program, the company continues to improve its operational performance through more economic pricing, reduction in overhead expenses, consolidation of important facilities and increased efficiency in all three business segments. Based on these strategic initiatives, Gibraltar Industries now anticipates full-year 2016 earnings in the range of $1.37–$1.47 per share as against the previously estimated range of $1.30–$1.40. Moreover, the RBI acquisition is expected to support Gibraltar Industries’ revenue and margin growth in the quarters ahead. Also, the company’s four-pillar growth strategy and tactical restructuring initiatives are expected to boost its near-term results.

Risks

Though we believe that this Zacks Rank #1 (Strong Buy) stock would witness improvement its top line and bottom line in the quarters ahead, certain industry-specific headwinds are likely to hurt its commercial prospects. For instance, intense competition exposes the company to risks of market share loss as well as pricing wars. Further, the firm’s international operations might face adverse effects from unfavorable foreign currency movements.

Stocks to Consider

Other well-ranked stocks in the industry include Caesarstone Ltd. CSTE, James Hardie Industries plc JHX and Trex Co. Inc. TREX. All the three companies currently hold a Zacks Rank #2 (Buy).

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