Fortune Brands Home & Security (FBHS) Downgraded to Hold at Zacks Investment Research

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Zacks Investment Research downgraded shares of Fortune Brands Home & Security (NYSE:FBHS) from a buy rating to a hold rating in a research note released on Monday morning.

According to Zacks, “Over the past three months, Fortune Brands' shares have underperformed the industry. The company reported weaker-than-expected third-quarter 2018 results. Weaker summer market demand and adverse impact of Hurricane Florence dampened revenues in the quarter. This along with rising costs and expenses impacted profitability. The company perceives that inflationary pressure, integration costs associated with the Fiberon acquisition, impact of bond financing and inefficiencies existing within Security operations will weigh over its near-term profitability. Notably, the company lowered its earnings view for 2018 from $3.62-$3.72 per share to $3.41-$3.49 per share. However, we believe that the company is poised to gain from its solid product portfolio, inorganic activities and shareholder-friendly policy in the long run. In the past 60 days, earnings estimates on the stock improved for 2019.”

Other research analysts have also recently issued reports about the stock. Loop Capital lowered their price target on shares of Fortune Brands Home & Security to $59.00 and set a buy rating for the company in a research report on Thursday, October 25th. Goldman Sachs Group raised shares of Fortune Brands Home & Security from a neutral rating to a buy rating and set a $54.00 price target for the company in a research report on Sunday, December 9th. Bank of America raised shares of Fortune Brands Home & Security from an underperform rating to a neutral rating and set a $47.00 price target for the company in a research report on Friday, January 4th. Evercore ISI raised shares of Fortune Brands Home & Security from an in-line rating to an outperform rating in a research report on Monday. Finally, ValuEngine cut shares of Fortune Brands Home & Security from a sell rating to a strong sell rating in a research report on Friday, January 4th. One equities research analyst has rated the stock with a sell rating, eight have assigned a hold rating and six have assigned a buy rating to the company’s stock. Fortune Brands Home & Security has an average rating of Hold and a consensus target price of $56.25.

Shares of FBHS opened at $42.58 on Monday. The stock has a market cap of $5.96 billion, a PE ratio of 13.82, a P/E/G ratio of 1.05 and a beta of 1.31. The company has a debt-to-equity ratio of 0.89, a quick ratio of 0.83 and a current ratio of 1.30. Fortune Brands Home & Security has a 1-year low of $35.27 and a 1-year high of $73.62.

Fortune Brands Home & Security (NYSE:FBHS) last announced its earnings results on Thursday, October 25th. The industrial products company reported $0.93 earnings per share for the quarter, missing analysts’ consensus estimates of $1.05 by ($0.12). The company had revenue of $1.38 billion for the quarter, compared to the consensus estimate of $1.44 billion. Fortune Brands Home & Security had a net margin of 7.94% and a return on equity of 20.95%. Research analysts expect that Fortune Brands Home & Security will post 3.43 EPS for the current year.

The company also recently announced a quarterly dividend, which will be paid on Wednesday, March 13th. Shareholders of record on Friday, February 22nd will be issued a $0.22 dividend. The ex-dividend date is Thursday, February 21st. This is a boost from Fortune Brands Home & Security’s previous quarterly dividend of $0.20. This represents a $0.88 annualized dividend and a yield of 2.07%. Fortune Brands Home & Security’s payout ratio is 25.97%.

A number of institutional investors have recently modified their holdings of FBHS. Avitas Wealth Management LLC grew its stake in shares of Fortune Brands Home & Security by 1.7% in the third quarter. Avitas Wealth Management LLC now owns 34,449 shares of the industrial products company’s stock worth $1,804,000 after acquiring an additional 579 shares during the period. Riverhead Capital Management LLC grew its stake in shares of Fortune Brands Home & Security by 17.1% in the second quarter. Riverhead Capital Management LLC now owns 6,322 shares of the industrial products company’s stock worth $339,000 after acquiring an additional 923 shares during the period. Meeder Asset Management Inc. grew its stake in shares of Fortune Brands Home & Security by 10.2% in the third quarter. Meeder Asset Management Inc. now owns 13,342 shares of the industrial products company’s stock worth $698,000 after acquiring an additional 1,239 shares during the period. Peloton Wealth Strategists grew its stake in shares of Fortune Brands Home & Security by 6.3% in the second quarter. Peloton Wealth Strategists now owns 21,825 shares of the industrial products company’s stock worth $1,172,000 after acquiring an additional 1,300 shares during the period. Finally, Cambridge Investment Research Advisors Inc. grew its stake in shares of Fortune Brands Home & Security by 11.9% in the second quarter. Cambridge Investment Research Advisors Inc. now owns 12,419 shares of the industrial products company’s stock worth $667,000 after acquiring an additional 1,321 shares during the period. 86.83% of the stock is owned by institutional investors and hedge funds.

About Fortune Brands Home & Security

Fortune Brands Home & Security, Inc, together with its subsidiaries, provides home and security products for residential home repair, remodeling, new construction, and security applications. It operates in four segments: Cabinets, Plumbing, Doors, and Security. The Cabinets segment manufactures custom, semi-custom, and stock cabinetry, as well as vanities for the kitchen, bath, and other parts of the home directly to kitchen and bath dealers, home centers, wholesalers, and builders in North America.

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