Owens Corning (OC) AI Stock Analysis

• Market Cap: $11.97B
• Dividend Yield: 1.89%
• Average Volume (3M): 977.02K
• Price to Earnings (P/E): 37.7
• Beta (1Y): 1.33
• Revenue Growth: 13.08%
• EPS Growth: -67.65%
• Country: US
• Employees: 25,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Construction
• EPS (TTM): 4.21
• Shares Outstanding: 83,627,556
• 10 Day Avg. Volume: 1,066,972
• 30 Day Avg. Volume: 977,019
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.47
• Enterprise Value/Revenue: 1.57
• Enterprise Value/Gross Profit: 5.30
• Enterprise Value/Ebitda: 9.57
• 1Y Price Target: $176.43
• Price Target Upside: 25.07% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 69 Neutral
• Price Target: $164.00 ▲(16.26% Upside)

Owens Corning's overall stock score reflects strong earnings performance and strategic focus, offset by valuation concerns and operational challenges. The company's ability to maintain high margins and strategic divestitures are significant positives, while high leverage and valuation metrics pose risks.

Positive Factors

Consistent High Adjusted EBITDA Margins

Sustained high EBITDA margins indicate strong operational efficiency and pricing power, enhancing long-term profitability and competitiveness.

Revenue and Earnings Growth

Significant revenue and earnings growth reflects robust demand for products and effective cost management, supporting future expansion and market leadership.

Strategic Divestitures

Strategic divestitures allow focus on core markets, improving operational focus and potentially enhancing profitability in key regions.

Negative Factors

Free Cash Flow Decline

Declining free cash flow can limit investment capacity and shareholder returns, posing a risk to financial flexibility and growth initiatives.

Challenges in Residential Insulation

Decreased demand in residential insulation could impact revenue growth and market share in a key segment, affecting overall business performance.

Rising Leverage

Increased leverage can heighten financial risk, potentially constraining future borrowing capacity and increasing vulnerability to economic downturns.

Owens Corning Business Overview & Revenue Model

Company Description

Owens Corning manufactures and markets insulation, roofing, and fiberglass composite materials in the United States, Canada, Europe, the Asia Pacific, and internationally. It operates in three segments: Composites, Insulation, and Roofing. The Composites segment manufactures, fabricates, and sells glass reinforcements in the form of fiber; and glass fiber products in the form of fabrics, non-wovens, and other specialized products. Its products are used in building structures, roofing shingles, tubs and showers, pools, flooring, pipes and tanks, poles, electrical equipment, and wind-energy turbine blades applications in the building and construction, renewable energy, and infrastructure markets. This segment sells its products directly to parts molders, fabricators, and shingle manufacturers. The Insulation segment manufactures and sells insulation products for residential, commercial, industrial, and other markets for thermal and acoustical applications; and glass fiber pipe insulation, flexible duct media, bonded and granulated mineral fiber insulation, cellular glass insulation, and foam insulation products used in construction applications. This segment sells its products primarily to the insulation installers, home centers, lumberyards, retailers, and distributors under the Thermafiber, FOAMULAR, FOAMGLAS, Paroc, Owens Corning PINK, and FIBERGLAS Insulation brand names. The Roofing segment manufactures and sells aminate and strip asphalt roofing shingles, oxidized asphalt materials, and roofing components used in residential and commercial construction, and specialty applications, as well as synthetic packaging materials. This segment sells its products through distributors, home centers, lumberyards, retailers, and contractors, as well as to roofing contractors for built-up roofing asphalt systems; and manufacturers in automotive, chemical, rubber, and construction industries. Owens Corning was incorporated in 1938 and is headquartered in Toledo, Ohio.

How the Company Makes Money

Owens Corning generates revenue primarily through the sale of its core products across the three business segments. The Insulation segment earns revenue from the manufacturing and sale of fiberglass insulation and related products, which are used in both residential and commercial construction. The Roofing segment contributes significantly through the sales of roofing shingles and accessories, catering to the residential market and commercial roofing applications. The Composites segment makes money by providing fiberglass reinforcements and other composite materials for various industrial applications. Additionally, Owens Corning benefits from strategic partnerships with construction and manufacturing companies, enhancing its market reach and product offerings. The company's commitment to sustainable practices and energy-efficient solutions also resonates with environmentally conscious consumers, driving demand and contributing to its overall earnings.

Owens Corning Financial Statement Overview

Summary

Owens Corning shows a stable financial position with strong cash flow generation and a solid equity base. However, challenges in revenue growth and profitability margins, along with increased leverage, highlight areas for improvement.

Income Statement

Owens Corning's income statement shows a mixed performance. The company has maintained a stable gross profit margin around 29%, which is decent for the construction industry. However, the net profit margin has significantly decreased to 2.28% in the TTM, indicating challenges in converting revenue into profit. Revenue growth has been negative recently, with a -3.75% decline in the TTM, which is concerning. EBIT and EBITDA margins have also decreased, reflecting operational challenges.

Balance Sheet

The balance sheet reflects a strong equity position with an equity ratio of approximately 35.65%, indicating a solid financial foundation. However, the debt-to-equity ratio has increased to 1.23 in the TTM, suggesting rising leverage, which could pose risks if not managed carefully. Return on equity has decreased to 6.42%, showing reduced efficiency in generating returns from equity.

Cash Flow

Owens Corning's cash flow statement shows positive trends with a 17.31% growth in free cash flow in the TTM, indicating improved cash generation. The operating cash flow to net income ratio is 0.67, suggesting strong cash conversion. The free cash flow to net income ratio is 0.62, reflecting efficient cash utilization despite a decline in net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.16B	10.97B	9.68B	9.76B	8.50B	7.05B
Gross Profit	3.31B	3.29B	2.84B	2.71B	2.22B	1.64B
EBITDA	1.83B	1.75B	2.17B	2.07B	1.91B	341.00M
Net Income	333.00M	647.00M	1.20B	1.24B	995.00M	-383.00M
Balance Sheet
Total Assets	14.48B	14.07B	11.24B	10.75B	10.02B	9.48B
Cash, Cash Equivalents and Short-Term Investments	230.00M	361.00M	1.61B	1.10B	959.00M	717.00M
Total Debt	5.98B	5.62B	3.27B	3.22B	3.12B	3.28B
Total Liabilities	9.28B	8.96B	6.03B	6.13B	5.68B	5.54B
Stockholders Equity	5.16B	5.08B	5.17B	4.58B	4.30B	3.90B
Cash Flow
Free Cash Flow	914.00M	1.25B	1.19B	1.31B	1.09B	828.00M
Operating Cash Flow	1.65B	1.89B	1.72B	1.76B	1.50B	1.14B
Investing Cash Flow	-586.00M	-3.39B	-356.00M	-623.00M	-377.00M	-205.00M
Financing Cash Flow	-1.10B	334.00M	-877.00M	-974.00M	-881.00M	-358.00M

Owens Corning Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 141.06
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OC, the sentiment is Negative. The current price of 141.06 is below the 20-day moving average (MA) of 148.48, below the 50-day MA of 147.51, and below the 200-day MA of 151.21, indicating a bearish trend. The MACD of -2.00 indicates Positive momentum. The RSI at 40.73 is Neutral, neither overbought nor oversold. The STOCH value of 14.13 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OC.

Owens Corning Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AWI	80 Outperform	$8.39B	28.71	35.33%	0.64%	15.59%	23.46%
WMS	75 Outperform	$10.68B	24.80	21.03%	0.49%	0.24%	-12.68%
OC	69 Neutral	$11.97B	37.74	12.26%	1.89%	13.08%	-67.65%
MAS	64 Neutral	$14.75B	18.71	-947.06%	1.73%	-2.73%	-8.31%
BLDR	59 Neutral	$13.07B	17.94	18.10%	―	-6.39%	-42.36%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%