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Beacon (BECN) Buys Complete Supply, Expands Chicago Presence

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Beacon Roofing Supply, Inc. (BECN - Free Report) continues its acquisition spree with its latest buyout of Complete Supply, Inc. However, the financial terms of the transaction have not yet been disclosed.

Shares of Beacon — the largest distributor of residential and non-residential roofing materials in the United States and Canada — rose 2.5% since the release of the news on Jun 1, 2022.

Buyout Benefits

Complete Supply has been serving customers in the greater Chicago market for their residential and complementary product requirements.

Complete Supply is a distributor of residential roofing and exterior building supplies to contractors and homebuilders in Willowbrook, IL and this buyout has expanded Beacon’s footprint in Chicago.

Pertaining to this latest buyout, Jake Gosa, Beacon’s President, North Division, said, “Expanding our depth of service in the Chicago market will bring Complete Supply customers the opportunity to benefit from our digital solutions, TRI-BUILT product line and the Beacon OTC network. With this acquisition, we continue to expand our footprint and drive toward achieving our Ambition 2025 growth targets."

Strategic Efforts: a Boon

Beacon has undertaken several strategic initiatives to drive its long-term ambition of growing and enhancing customer experience, expanding the top line and margin as well as boosting value for customers, suppliers, employees, and shareholders.

On Apr 29, 2022, BECN acquired a distributor of complementary residential exterior building supplies, Wichita Falls Builders Wholesale, Inc., for an undisclosed amount. Builders Wholesale has a three-decade history and strong reputation for serving customers in greater Wichita Falls, TX.

On Dec 31, 2021, Beacon announced the acquisition of a wholesale distributor of residential exterior building materials — Crabtree Siding and Supply. This takeover has further strengthened Beacon’s presence in Tennessee.

The company has been focusing on its Ambition 2025 targets which emphasize operational excellence, above market growth trajectory and accelerated stockholder value creation. Ambition 2025 financial targets assume that sales will reach $9 billion (8% CAGR) and $1 billion of EBITDA (10% CAGR), which would translate to 11% EBITDA margins (up 100 basis points from 2021).
 

Zacks Investment Research
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Shares of Beacon have risen 9.9% this year against the industry’s 26.8% decline. Earnings estimates for this year have increased 21.1% over the past 30 days to $6.48 per share. This depicts analysts’ optimism over the company’s growth potential.

Solid strategic efforts, exceptional operating cost management and cash flow, focus on the e-commerce platform, new OTC (On-Time and Complete) Delivery Network, and a newly-designed website will drive growth.

Zacks Rank

Beacon currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Top-Ranked Stocks From the Broader Retail-Wholesale Sector

Other top-ranked stocks in the Zacks Retail-Wholesale sector are MarineMax, Inc. (HZO - Free Report) , BBQ Holdings, Inc. and Fastenal (FAST - Free Report) .

MarineMax sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 32.8%, on average. Shares of the company have declined 13.1% in the past year.

The Zacks Consensus Estimate for MarineMax’s 2022 sales and EPS suggests growth of 16% and 21.5%, respectively, from the year-ago period’s levels.

BBQ Holdings carries a Zacks Rank #2. BBQ Holdings has a long-term earnings growth of 14%. Shares of the company have decreased 2.9% in the past year.

The Zacks Consensus Estimate for BBQ Holdings’ 2022 sales and EPS suggests growth of 46.1% and 67.6%, respectively, from the year-ago period’s levels.

Fastenal carries a Zacks Rank #2. FAST has a long-term earnings growth of 9%. Shares of the company have increased 3.9% in the past year.

The Zacks Consensus Estimate for FAST’s 2022 sales and EPS suggests growth of 15.4% and 17.5%, respectively, from the year-ago period’s levels.


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