TopBuild Corp. (NYSE:BLD) shares dropped about 4% in premarket trading Thursday after the insulation and building products company reported fourth-quarter earnings that came in slightly below Wall Street expectations and issued softer-than-anticipated guidance for 2026.
Adjusted earnings per share totaled $4.50 for the quarter, narrowly missing analyst forecasts of $4.54. Revenue reached $1.49 billion, matching consensus estimates and rising 13.2% year over year, largely supported by recent acquisitions.
Investor sentiment was weighed down by the company’s forward outlook. TopBuild projected fiscal 2026 revenue between $5.93 billion and $6.23 billion, with the midpoint of $6.08 billion coming in below analyst expectations of $6.16 billion. The company also guided adjusted EBITDA to a range of $1.005 billion to $1.155 billion for the year.
CEO Robert Buck pointed to ongoing market pressures, saying the company “adapted our business to address the uncertain housing environment.”
Growth in fourth-quarter sales was primarily driven by acquisitions, including SPI and Progressive Roofing, which helped offset continued softness in residential and light commercial construction markets.
The Installation Services segment maintained strong profitability, posting an adjusted EBITDA margin of 21.0%. However, margins in Specialty Distribution declined, reflecting integration impacts tied to the SPI acquisition.
Same-branch sales declined 9.8% during the quarter, with residential activity falling 14.4% and commercial and industrial sales slipping 1.7%.
During 2025, TopBuild completed seven acquisitions that added roughly $1.2 billion in annual revenue. The company also returned $434.2 million to shareholders through share repurchases, buying back approximately 1.4 million shares.
Looking ahead, management expects mid-single-digit declines in residential sales in 2026 alongside low-single-digit growth in commercial and industrial markets, while mergers and acquisitions are projected to contribute between $800 million and $850 million in additional revenue.