Taylor, MI, September 21, 2006-- Home improvement and building products producer Masco Corp., has lowered its full-year profit forecast due to disappointing sales in this year's latter half.
The company said results are being impacted by a larger-than-expected decline in single-family housing starts for the last four months of 2006, which are seen falling 20 percent over the year-ago period.
The company, which makes products ranging from faucets to whirlpool baths, is a leading supplier to home improvement chains Home Depot and Lowe's. Its forecast does not bode well for both retailers, Credit Suisse said in a client note.
"Consistent with our downgrade of Home Depot shares on Monday, we continue to believe the fallout from the housing market slump is still in the early stages, and will drag on results at Home Depot and Lowe's for a number of quarters ahead," analyst Gary Balter.
Home Depot accounts for one-fifth of Masco's total sales, while Lowe's accounts for 5 percent.
