American Woodmark (AMWD) AI Stock Analysis

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American Woodmark

(NASDAQ:AMWD)

68Neutral

American Woodmark's stock score reflects a mixed financial performance with strong cash flow and improving net profitability but challenges in revenue stability and leverage. Technical indicators suggest a bearish trend, while the stock appears undervalued on a P/E basis. The latest earnings call outlines strategic adjustments but highlights significant risks in declining sales and market challenges.

Positive Factors

Margin Improvement

Solid sequential margin improvement on a similar revenue base.

Market Share

New stock kitchen/bath wins support recent capacity investments and share gain targets.

Negative Factors

Revenue Performance

Sales undershot expectations, with weaker remodel demand more than offsetting new construction growth.

American Woodmark (AMWD) vs. S&P 500 (SPY)

Market Cap

$913.07M

Dividend YieldN/A

Average Volume (3M)159.54K

Price to Earnings (P/E)9.5

Beta (1Y)1.35

Revenue Growth-6.02%

EPS Growth-10.65%

CountryUS

Employees8,600

SectorConsumer Cyclical

Sector Strength75

IndustryFurnishings, Fixtures & Appliances

Share Statistics

EPS (TTM)1.05

Shares Outstanding14,834,665

10 Day Avg. Volume158,518

30 Day Avg. Volume159,541

Financial Highlights & Ratios

PEG Ratio-2.65

Price to Book (P/B)0.99

Price to Sales (P/S)0.00

P/FCF Ratio22.58

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$75.00

Price Target Upside21.85% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering3

American Woodmark Business Overview & Revenue Model

Company DescriptionAmerican Woodmark Corporation manufactures and distributes kitchen, bath, office, home organization, and hardware products for the remodelling and new home construction markets in the United States. The company offers made-to-order and cash and carry products. It also provides turnkey installation services to its direct builder customers through a network of eight service centers. The company sells its products under the American Woodmark, Timberlake, Shenandoah Cabinetry, Waypoint Living Spaces, Estate, Stor-It-All, and Professional Cabinet Solutions brands, as well as Hampton Bay, Glacier Bay, Style Selections, Allen + Roth, Home Decorators Collection, and Project Source. It markets its products directly to home centers and builders, as well as through independent dealers and distributors. The company was incorporated in 1980 and is based in Winchester, Virginia.

How the Company Makes MoneyAmerican Woodmark makes money primarily through the sale of cabinetry products. Its revenue streams are driven by sales in the remodeling and new home construction markets. The company offers a variety of cabinetry styles and finishes, catering to different customer preferences and price points. Key revenue streams include sales to homebuilders, home improvement retailers, and independent dealers. American Woodmark also leverages significant partnerships with major retail chains, enhancing its distribution network and market reach. Additionally, the company benefits from its direct-to-consumer sales channels, which allow it to capture a broader customer base and increase its market penetration.

American Woodmark Financial Statement Overview

Summary

American Woodmark demonstrates a mixed financial profile, with strengths in cash flow generation and improvements in net profitability over the trailing periods. However, revenue volatility and high leverage remain areas of concern. The company should focus on stabilizing revenue growth and further reducing debt to enhance financial health.

Income Statement

Positive

American Woodmark has shown signs of revenue volatility, with fluctuations from $1.65 billion in 2020 to $2.06 billion in 2023, and a decrease to $1.76 billion in TTM. The gross profit margin has seen improvement from 2022 onwards, with a notable increase in net income to $100.7 million in TTM compared to previous periods. Despite these positive trends, the company experienced a downturn in revenue growth and profit margins over the last year, affecting overall performance.

Balance Sheet

Positive

The balance sheet reflects moderate stability, with a debt-to-equity ratio improving from 2022 due to a reduction in total debt. Stockholders' equity has increased, offering a better equity ratio. However, the company still carries significant debt, which could pose risks if profitability does not improve consistently.

Cash Flow

Positive

American Woodmark's cash flow generation is strong, with positive operating cash flow and free cash flow in the TTM period. The free cash flow to net income ratio is robust, indicating efficient cash generation relative to net income. Despite a decrease in free cash flow compared to previous periods, the company maintains a solid cash flow position.

TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Breakdown
Income Statement		Total Revenue
1.76B	1.85B	2.07B	1.86B	1.74B	1.65B
	Gross Profit
322.44M	377.81M	357.52M	226.44M	319.27M	329.19M
	EBIT
148.93M	161.39M	136.35M	-60.74M	6.12M	33.71M
	EBITDA
113.37M	238.96M	228.62M	36.16M	230.00M	253.49M
	Net Income Common Stockholders
100.69M	116.22M	93.72M	-29.72M	61.19M	73.65M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
43.48M	87.40M	41.73M	22.32M	91.07M	97.06M
	Total Assets
1.59B	1.59B	1.52B	1.63B	1.64B	1.62B
	Total Debt
518.70M	508.46M	477.81M	626.07M	651.39M	728.49M
	Net Debt
475.21M	421.07M	436.07M	603.74M	560.32M	631.43M
	Total Liabilities
670.67M	683.49M	645.01M	859.61M	893.62M	922.27M
	Stockholders Equity
919.56M	910.38M	873.79M	772.88M	742.90M	700.54M
Cash Flow		Free Cash Flow
39.74M	139.70M	154.13M	-19.68M	116.03M	145.87M
	Operating Cash Flow
107.00M	230.75M	196.73M	24.45M	151.76M	177.54M
	Investing Cash Flow
-68.67M	-92.19M	-43.23M	-51.57M	-42.43M	-38.92M
	Financing Cash Flow
-92.68M	-92.89M	-134.09M	-41.62M	-115.32M	-99.22M

American Woodmark Technical Analysis

Technical Analysis Sentiment

Positive

Last Price61.55

Price Trends

50DMA

58.64

Positive

100DMA

67.04

Negative

200DMA

79.46

Negative

Market Momentum

MACD

0.62

Negative

RSI

55.66

Neutral

STOCH

69.93

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMWD, the sentiment is Positive. The current price of 61.55 is above the 20-day moving average (MA) of 59.11, above the 50-day MA of 58.64, and below the 200-day MA of 79.46, indicating a neutral trend. The MACD of 0.62 indicates Negative momentum. The RSI at 55.66 is Neutral, neither overbought nor oversold. The STOCH value of 69.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMWD.

American Woodmark Risk Analysis

American Woodmark disclosed 23 risk factors in its most recent earnings report. American Woodmark reported the most risks in the “Production” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

American Woodmark Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LZB	72 Outperform	$1.83B	15.18	12.40%	1.90%	1.81%	8.09%
ETD	68 Neutral	$701.36M	12.23	12.09%	5.66%	-6.32%	-18.35%
AMWD	68 Neutral	$913.07M	9.52	11.09%	―	-6.02%	-10.65%
Sector *	61 Neutral	$6.97B	11.38	2.88%	3.90%	2.64%	-22.07%
BSET	56 Neutral	$150.58M	―	-3.83%	4.51%	-11.78%	-13.89%
LEG	54 Neutral	$1.29B	―	-50.35%	2.09%	-6.50%	-221.33%
MLKN	52 Neutral	$1.20B	41.65	2.28%	4.24%	-2.68%	-56.16%

* Consumer Cyclical Sector Average

Performance Comparison

AMWD

American Woodmark

61.55

-33.08

-34.96%

BSET

Bassett Furniture

16.96

3.63

27.23%

ETD

Ethan Allen

27.08

-0.39

-1.42%

MLKN

MillerKnoll

17.33

-9.35

-35.04%

LZB

La-Z-Boy Incorporated

43.62

8.57

24.45%

LEG

Leggett & Platt

9.25

-2.42

-20.74%

American Woodmark Earnings Call Summary

Earnings Call Date:Feb 27, 2025

(Q3-2025)

% Change Since: -13.49%|

Next Earnings Date:May 29, 2025

Earnings Call Sentiment Negative

The earnings call highlighted strategic operational adjustments and product launches but was overshadowed by significant declines in net sales, reduced guidance, and challenges in the housing market. Margin pressures and potential tariff impacts also contribute to a cautious outlook.

Q3-2025 Updates

Positive Updates

Share Repurchase Program

The company repurchased 132,000 shares, approximately 1% of outstanding shares in the quarter, and has repurchased $156.8 million worth of shares since the start of fiscal year 2024.

Operational Adjustments and Strategy

The company has made significant operational adjustments, including the closure of the Orange, Virginia plant to improve efficiency, and continues to execute its growth strategy with 3 main pillars: growth, digital transformation, and platform design.

New Product Launches

The company is launching new finishes and styles in its kitchen and bath categories to maintain market relevance and drive share gains.

Negative Updates

Decline in Net Sales

Net sales for the third quarter were $397.6 million, a decrease of 5.8% compared to the prior year, driven by declines in new construction and remodel markets.

Reduced Guidance for Fiscal Year 2025

The company expects a mid-single-digit decline in net sales for the full fiscal year and revised its projected EBITDA margin to a range of $210 million to $215 million due to softening sales volumes and increased manufacturing costs.

Margin Pressures and Increased Costs

Gross profit as a percent of net sales decreased by 420 basis points to 15% due to lower sales volumes and increased product input costs such as raw materials and labor.

Challenges in the Housing Market

The housing market faced challenges with reduced new construction activity and lower consumer confidence, impacting demand for higher ticket remodel projects.

Potential Tariff Impacts

There is uncertainty regarding tariffs, particularly with exposure in Mexico and China. The company is evaluating potential pricing actions to mitigate these impacts.

Company Guidance

During American Woodmark Corporation's third fiscal quarter 2025 conference call, the company provided detailed financial guidance and performance metrics. They reported net sales of $397.6 million, a decrease of 5.8% year-over-year, and an adjusted EBITDA of $38.4 million or 9.7% of net sales. The company noted challenging demand trends, particularly in the remodel market, and a 10.4% decline in new construction net sales. The adjusted earnings per share (EPS) were $1.09, and the cash balance stood at $43.5 million, with an additional $314.2 million available under a revolving credit facility. The company repurchased approximately 1% of outstanding shares during the quarter, with a leverage ratio of 1.53x adjusted EBITDA. Looking ahead, American Woodmark expects a mid-single-digit decline in net sales for the full fiscal year and anticipates an adjusted EBITDA range of $210 million to $215 million, amid macroeconomic challenges such as consumer sentiment declines, inflation risks, and potential tariff impacts.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.