Stifel Offers Projection of Mohawk's Performance in 2018

St. Louis, MO, November 8, 2017-Stifel has offered its projection on Mohawk’s performance in 2018, “…we expect revenue growth to accelerate somewhat for Mohawk in 2018 and earnings growth should accelerate in the second half of 2018 as the intellectual property loss laps and more productive capacity is online with better throughputs. We don't see a slowing demand picture in the U.S. or other key markets for Mohawk. If anything, we see business strengthening in Europe and domestically.

“Revenue increases should accelerate as capacity constraints in 2017 are resolved to some degree and storm impacted areas see a tailwind, not headwind to sales.

“LVT will remain a huge growth area for Mohawk but will cannibalize other segments to some degree. LVT margins should benefit from better production rates, reduced sourcing, and meaningful sales growth. Mohawk's competition in North America in LVT is lagging Mohawk's capabilities in a widening gap of performance.

“Ceramic production and revenues should be stronger in North America next year than this year and Europe, Eastern Europe and Russia appear to be accelerating in growth. The storm impact to this segment was material as Texas and Florida are large tile markets.

“Input cost pressures will continue but the speed and magnitude or pricing offsets should prevent this from being a material margin headwind. Carpet, the segment with the most cost pressures, is operating at the highest margin rate in Mohawk's history, and we believe the competition needs price relief.”