Masco's (MAS) new 2028 financial targets are "largely in line" with previous goals but slightly narrowed, RBC Capital Markets said in a note Thursday, with takeaways from the company's investor day event.
The company said Wednesday it targets a compound annual growth rate of 10% in adjusted EPS by 2028. It also set a 2028 annual organic sales growth target of 3% to 4%, and an adjusted operating margin target of at least 18%.
RBC highlighted that Chief Executive Jon Nudi indicated a "strong commitment to above-market growth" backed by areas like plumbing for the luxury space, professional paint share gains, as well as wellness.
The "slightly muted" goals compared with previous guidance "reflect a realistic view of current end market weakness/risks and distance between recent trends and prior targets," the note said.
The investment firm said it still likes the company's "high-quality portfolio" as well as its "durable" free cash flow and capital deployment opportunities, but the lack of material upside to the new goals as well as near-term challenges are keeping Masco's risk/reward proposition balanced.
RBC has a sector perform rating on Masco and a $72 price target.
Price: 68.43, Change: +0.94, Percent Change: +1.40
Comments