Stock Building Supply reported first-quarter earnings Tuesday that beat Wall Street estimates for profitability but missed for net sales.
Raleigh-based Stock reported net income of $1.9 million, or 7 cents per share, compared with a net loss of $3.3 million, or 13 cents per share during the same period last year. The consensus among analysts who cover the company was a loss of 6 cents per share.
Stock reported net sales of $297.6 million, a 6.3 percent increase over the first quarter of 2014. That was below the $313 million forecast by analysts. Gross profit in the quarter was $71.3 million, up 9.3 percent from the same period a year ago.
Stock sells windows, doors and other housing materials in 14 states. Its core customers are both homebuilders and remodeling contractors. The strength of its business is tied directly to the pace of new home construction in the U.S.
Jeff Rea, Stock’s CEO, said on a conference call with analysts that the company is confident about the near-term housing market because the larger builders have been reporting strong order rates and backlogs of business that indicate first-time and move-up home buyers may be back in the market.
"And that’s very positive because we believe that that may be an indication that the cycle here that we’ve been waiting on for some of those millennials to enter the market may be starting and that’s a very, very healthy sign as you kind of have that domino effect through the housing industry when that happens," Rea said.
Stock shares rose 60 cents, or 3 percent, to $19.46 in afternoon trading Tuesday. The stock is up 27 percent this year.