This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Masco Shares Drop After Weak 4th-qtr Results

NEW YORK (AP) â¿¿ Shares of homebuilding products maker Masco Corp. slid Tuesday after the company announced fourth-quarter results that fell short of analyst expectations, dimming hopes for a robust recovery in its long-battered home supply business.

THE SPARK: Masco Corp. said late Monday that it posted a loss of 9 cents per share in the three months ended Dec. 31, excluding costs for litigation and other one-time items. The same figure in the last three months of 2010 came to a loss of 8 cents per share.

Wall Street analysts polled by FactSet had expected a narrower loss of 7 cents per share, and their estimates have worsened recently. At the end of January, analysts expected an adjusted loss of 2 cents per share.

Meanwhile, Masco's quarterly revenue rose 1 percent to $1.74 billion. Analysts expected $1.76 billion.

THE BIG PICTURE: The housing slump that began in 2006 stalled construction. That's hurt Masco, which makes home fixtures like cabinets and plumbing that are installed in new housing projects, or purchased when homeowners renovate their houses.

And even if real estate improves in 2012, the glut of foreclosed properties on the market may depress demand for new housing and materials.

Masco did not provide specific earnings guidance for 2012, but CEO Tim Wadhams said that the company's efforts to cut costs and strengthen its balance sheet should improve Masco's results in 2012 even if the housing market stagnates.

THE ANALYSIS: Raymond James analyst Sam Darkatsh on Tuesday downgraded Masco to "Underperform" from "Market Perform."

Darkatsh said in a note to clients that although Masco's shares have rallied on hopes of a housing market recovery this year, his outlook for construction and remodeling are modest because of the many foreclosed homes on the market, high unemployment and other factors. Moreover, about 20 percent of the company's sales came from Europe in 2011, where the economy is worsening because of the debt crisis, he said.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free


Chart of I:DJI
DOW 17,045.84 -4.91 -0.03%
S&P 500 2,013.43 +15.91 0.80%
NASDAQ 4,822.8970 +12.1090 0.25%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs