Builders FirstSource, Inc. (BLDR)
Valuation Overview•Is Builders FirstSource, Inc. Overvalued or Undervalued?
Trading at a discount across both intrinsic cash flow and relative peer multiples, indicating a strong margin of safety.
Fragile underlying quality score of 34/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Highly distressed profile flashing severe fundamental warning signs.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. This is paired with healthy capital returns, driven predominantly by aggressive share repurchases.
Returns capital exclusively via buybacks — no active dividend
BLDR struggles with subpar profitability and pressured margins. However, the balance sheet carries elevated leverage, requiring careful monitoring of debt servicing capabilities.
The company is facing top-line contraction (-12.6% 3Y CAGR) however, earnings have severely contracted over the same period. However, profitability remains a major concern with severely compressed operating margins (4.2%).
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $3.3B | -7.4% | -12.6% | +12.2% | +15.6% | |
| EBITDA | $166.3M | — | -31.4% | — | — | |
| Net Income | -$47.4M | -59.6% | -45.9% | — | — | |
| EPS (Diluted) | $-0.43 | -57.1% | -38.6% | +7.9% | — | |
| Free Cash Flow | $40.7M | -42.8% | -36.0% | +42.0% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 29.9% | 32.3% | 32.1% | 28.8% |
| Operating Margin | 4.2% | 9.2% | 11.2% | 8.1% |
| Net Margin | 2.0% | 6.1% | 7.8% | 5.1% |
| FCF Margin | 5.8% | 8.5% | 9.5% | 6.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.39 | $0.27 | -30.8% | ||
| Q1'26 | $1.30 | $1.12 | -13.8% | ||
| Q4'25 | $1.75 | $1.88 | +7.4% | ||
| Q3'25 | $2.35 | $2.38 | +1.3% | ||
| Q2'25 | $1.50 | $1.51 | +0.7% | ||
| Q1'25 | $2.18 | $2.31 | +6.0% | ||
| Q4'24 | $2.98 | $3.07 | +3.0% | ||
| Q3'24 | $3.02 | $3.50 | +15.9% |
Total return is -24.6% (1Y), lagging the benchmark by -49.6%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | -23.0% | -32.3% | — |
| 1Y | -24.6% | -49.6% | — |
| 3YCAGR | -14.0% | -35.2% | — |
| 5YCAGR | +13.8% | -0.4% | — |
| 10YCAGR | +21.6% | +7.6% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Builders FirstSource, Inc. (BLDR) valuation, health, and returns.
Builders FirstSource, Inc. is estimated to be undervalued under our discounted cash flow framework. relative multiples indicate the stock is Slightly cheap versus peers compared to industry peers. undervalued (implying +21.9% upside to DCF intrinsic value of $98.20)
Builders FirstSource, Inc. has multiple valuation anchors: DCF Intrinsic Value: $98.20 | Peer Relative Fair Value: $96.04 | Wall Street Analyst Target: $106.38 (implying +32.0% upside). A convergence of these signals offers higher conviction.
Builders FirstSource, Inc. displays weak financial health with a composite quality score of 34/100, supported by a Altman Z-Score of 1.9 (grey zone), Piotroski F-Score of 5/9, Return on Invested Capital (ROIC) of 6.4%.
Builders FirstSource, Inc. returns capital via buybacks instead of dividends, carrying a 4.6% buyback yield and reducing outstanding shares by -6.0% in the last 12 months.
Builders FirstSource, Inc.'s current growth trajectory is Accelerating. The company achieved -7.4% 1Y revenue growth and -57.1% 1Y EPS growth, compared to its 3Y revenue CAGR of -12.6%.
Wall Street consensus is Buy based on 43 analysts, beating EPS expectations in 83% of recent quarters with a -2-quarter streak. The consensus price target represents a +32.0% change from current levels.
Investment risks for Builders FirstSource, Inc. include: -55.5% 1-year max drawdown, high beta (1.62x market volatility). Volatility risk is characterized by a beta of 1.62x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.