Carlisle Companies Incorporated CSL is benefiting from persistent strength in the Construction Materials segment. Strength in the non-residential construction market in the United States and Europe, driven by inventory normalization and growing re-roof activity as a result of pent-up demand, has been driving the segment’s performance. In the fourth quarter of 2024, revenues from the segment increased 2% year over year.

Backed by strong contractor backlogs and growing customer demand, the company expects the segment’s revenues to increase in the mid-single digits year over year in 2025. Driven by strength across its businesses, the company anticipates total revenues to increase in mid-single digit in 2025.

The company intends to strengthen and expand its businesses through acquisitions. In February 2025, CSL acquired ThermaFoam, which enabled it to boost its portfolio of polystyrene insulation products. The buyout expanded the company’s customer offerings and enhanced its presence in Texas and the South-Central United States market.

Its acquisition of Plasti-Fab (in December 2024) expanded its building envelope product portfolio and strengthened its position in the North American polystyrene insulation market. Also, Carlisle’s acquisition of MTL Holdings in May 2024 expanded its customer offerings and boosted its architectural metals business.

Management remains focused on rewarding its shareholders through dividend payouts. In 2024, it rewarded its shareholders with a dividend payment of $172.4 million, an increase of 7.6% year over year. In the same period, it repurchased shares worth $1.59 billion, up 76.2% year over year. At the end of fourth quarter, Carlisle was left to buy back 3.5 million shares.

CSL’s Price Performance

Image Source: Zacks Investment Research

In the past month, the Zacks Rank #3 (Hold) company has lost 0.9% compared with the industry’s 1.2% decline.

Amid this, softness in the Carlisle Weatherproofing Technologies segment, owing to lower volumes from a slowdown in the residential construction market and project delays, is adversely affecting Carlisle’s performance. The slowdown in new housing, repair and remodel activities due to high interest rates and affordability challenges is concerning. In the fourth quarter, organic revenues from the segment fell 8% on a year-over-year basis.

Carlisle has also been dealing with the increasing raw material and labor costs. Not only is this pushing up its direct expenses, but it is also raising its selling, administrative and R&D expenses. While current revenue growth rates are supporting the rising cost, they are largely driven by channel inventory filling. In 2024, its selling and administrative expenses and cost of sales increased 15.6% and 5.5%, respectively, year over year.

Key Picks

Some better-ranked stocks from the same space are discussed below.

Griffon Corporation GFF currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

GFF delivered a trailing four-quarter average earnings surprise of 14.7%. In the past 30 days, the Zacks Consensus Estimate for Griffon’s fiscal 2025 (ending September 2025) earnings has increased 2.3%.

The Middleby Corporation MIDD presently carries a Zacks Rank #2 (Buy). It has a trailing four-quarter earnings surprise of 1.9%, on average. The consensus estimate for MIDD’s 2025 earnings has increased 1.1% in the past 30 days.

IAC Inc. IAC presently carries a Zacks Rank of 2. The Zacks Consensus Estimate for IAC’s 2025 earnings has remained stable in the past 30 days.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Carlisle Companies Incorporated (CSL) : Free Stock Analysis Report

The Middleby Corporation (MIDD) : Free Stock Analysis Report

IAC Inc. (IAC) : Free Stock Analysis Report

Griffon Corporation (GFF) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research