Analyst Stifel Nicolaus is Bullish on Mohawk

Calhoun, GA, Dec. 13, 2013 -- Analyst Stifel Nicolaus said it is raising its 2014 earnings estimates for Mohawk Industries after meeting with the company's chief financial officer.

Stifel said it is raising its full-year estimate from $7.69 per share to $8.15 "to reflect much greater contribution margins in carpet and higher synergies in laminate and ceramic than we had originally modeled."

It has a "buy" rating on Mohawk, which will be added to the S&P 500 later this month.

Mohawk, Stifel said, should benefit from a continuing rebound in the residential and commercial markets in the U.S., which comprise approximately 70% of consolidated revenues.

Mohawk, which has recently acquired Pergo, Spano, and Marazzi has been integrating the businesses, and Stifel believes Marazzi has the greatest potential.

"Mohawk is now hitting on many cylinders after years of stagnant demand," Stifel said.

"As we have noted before, once volumes began to expand and mix improved, we expected to see good margin expansion. The past two quarters are evidence that these trends are underway. It doesn't hurt that raw materials have stabilized, allowing previous price increases to catch up to earlier cost inflation."

Stifel believes that management is more optimistic than at any time since 2006.

Carpet margins the past two quarters have been well in excess of the 20% long-term goal and will likely be closer to 30% in 2014, Stifel said, thanks in part to the "soft revolution."

Mohawk ceramic sales are just beginning to benefit from the Marazzi acquisition, Stifel said.



Other Archived Articles

New York Manufacturing Improves at Slower Pace   Full Article
New York, NY, Aug. 15, 2014 -- The Empire State manufacturing survey fell back to 14.7 in August after hitting a four-year high of 25.6 in July.

Consumer Sentiment Falls in Early August   Full Article
Washington, DC, Aug. 15, 2014 -- The preliminary August reading on the University of Michigan/Thomson Reuters consumer-sentiment index fell to 79.2 from a final July result of 81.8.

Investors Wondering About Firm's Stake in Armstrong   Full Article
New York, NY, Aug. 15, 2014 -- Flooring industry analyst Stifel Nicolaus says talk is heating among its clients up that Armstrong World Industries could be broken into separate entities.

Office Environments Acquires Flooring Firm   Full Article
Charlotte, NC, Aug. 15, 2014 -- Office Environments, a Charlotte based commercial furniture dealer, said it has acquired Modular Designs, a flooring firm also based in Charlotte.

FCICA Continuing Diamond Member Club   Full Article
West Bloomfield, MI, Aug. 15, 2014 -- FCICA, the Flooring Contractors Association, said it will continue its Diamond Club member program for the 2014-2015 membership year.

Housing Affordability Declines in Second Quarter   Full Article
Washington, DC, Aug. 15, 2014 -- Nationwide housing affordability dipped in the second quarter as several markets saw a firming of home prices, according to the National Association of Home Builders.

Georgia Unemployment Grows but Dalton Layoffs Fall   Full Article
Atlanta, GA, Aug. 14, 2014 -- Unemployment in Georgia in July rose to the highest rate since last October, according to the Georgia Department of Labor.

Initial Jobless Claims Rise Last Week   Full Article
Washington, DC, Aug. 14, 2014 -- Initial claims for unemployment benefits rose 21,000 to 311,000 in the week the ended Aug. 9, according to the Labor Department.

Higher Downpayments Hitting First-Time Home Buyers   Full Article
New York, NY, Aug. 14, 2014 -- Growing requirements for downpayments are shutting many first time buyers out of the housing market, Bloomberg News reports.

Tarkett Contest Features Commercial Flooring   Full Article
Chagrin Falls, OH, Aug. 14, 2014 -- Tarkett has launched a WeLikeItNatural Creative Contest featuring its commercial vinyl flooring.

Retail Sales Flat in July   Full Article
Retail Sales were flat in July as car demand slowed and consumers remained cautious in their spending. This is the weakest performance in six months.

Mortgage Application Volume Down Last Week   Full Article
New York, NY, Aug. 13, 2014 -- Mortgage application volume fell last week as both purchase and refinancing applications declined, according to the Mortgage Bankers Association.

Valinge Awarded Another U.S. Patent   Full Article
Viken, Sweden, Aug. 13, 2014 -- Valinge said it has been awarded a U.S. patents regarding mechanical locking of LVT/resilient floorboards.

Another Investment Firm Discloses Armstrong Position   Full Article
New York, NY, Aug. 13, 2014 -- Another investment firm has disclosed a large position in the shares of Armstrong World Industries.

Home Price Increases Continue To Moderate   Full Article
Washington, DC, Aug. 12, 2014 -- Home-price growth continued to moderate in many metropolitan areas in the second quarter, according to the National Association of Realtors.

Domotex Turkey 2015 Set for May   Full Article
Hannover, Germany, Aug. 12, 2014 -- The dates for Domotex Turkey 2015 are May 25-28 at the Turkish carpet trading capital, Gaziantep.

Job Openings Edge Higher in June   Full Article
Washington, DC, Aug. 12, 2014 -- Job openings increased to 4.67 million in June, according to the latest Job Openings and Labor Turnover Summary from the Bureau of Labor Statistics.

Ceramic Tile Standards Subject of Gathering in SC   Full Article
Clemson, SC, Aug. 12, 2014 -- International trade and standards for ceramic tile were the focus of discussions as delegates from 15 countries met in Clemson to develop new standards.

Propex Marks 50th Anniversary of Polybac   Full Article
Hazlehurst, GA, Aug. 11, 2014 -- Propex recently celebrated a significant milestone for the carpet industry at its Hazlehurst manufacturing facility.

Realtors Applaud FICO Calculation Changes   Full Article
Washington, DC, Aug. 11, 2014 -- The National Association of Realtors said it supports the decision of Fair Issac to make some changes related to how it calculates FICO credit scores.