Analysts Raise GMS Price Target After Solid Q2 Results

Reflecting on GMS Inc's GMS solid Q2 results, analysts raised their price target on the firm.

• RBC Capital analyst Mike Dahl raised GMS' price target to $68 (an upside of 19%) from $61 and maintained an Outperform rating on the shares.
• Dahl cites the company's Q2 earnings beat and believes that it benefits from pricing tailwinds as inflationary tailwinds continue and residential demand remains strong, offsetting declines in its commercial business.
• He adds that while supply vs. demand conditions remain supportive of pricing across categories, he remains skeptical on the sustainability of these gains next year.
• Barclays analyst Matthew Bouley raised the price target on GMS to $61 (an upside of 7%) from $56 and kept an Equal Weight rating on the shares.
• Bouley lifted fiscal 2022 EBITDA estimates by 22% following the "strong" fiscal print and Q3 guidance. The analyst mentions that the tight supply backdrop continues to drive incremental pricing, which GMS is successfully capturing on the top-line, driving significant leverage.
• Baird analyst David Manthey raised the price target on GMS to $68 from $62 and maintained an Outperform rating on the shares.
• Manthey sees a continued favorable fundamental outlook amid the commercial market recovery and sustained residential demand. Despite this positive outlook, valuation remains very reasonable, and he remains a buyer of GMS shares.
• Price Action: GMS shares are trading lower by 1.45% at $56.96 on the last check Friday.