Top building product stocks recommended by Truist

Investing.com – Building product companies have faced pressure this year, despite solid operational fundamentals, with many stocks still recording double-digit declines. Truist has identified four stocks in this sector that present buying opportunities, citing these companies’ specific advantages and attractive valuations relative to their growth prospects.

These stocks cover different sub-sectors within the building products industry, from ceiling systems to construction materials and distribution, offering investors diversified exposure to commercial, residential, and infrastructure end markets.

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Armstrong World Industries Truist maintains a buy rating with a target price of $230, applying a 16x EV/EBITDA multiple to the 2026 EBITDA estimate. The stock has fallen 12% this year. Armstrong’s entire business is driven by non-residential demand, making it less sensitive to interest rate fluctuations. The company benefits from dominant market share, pricing advantages in mineral fiber ceilings, and structural growth in specialty ceilings driven by organic growth and acquisitions. Aside from a potential recession, the company has achieved EBITDA growth annually. Risks include a slowdown in commercial activity, weak global demand, and increased competition.

Armstrong World Industries reported Q4 2025 results that missed analyst expectations, with earnings per share and revenue below forecasts.

CRH Truist sets a $140 target price based on a 13x EBITDA multiple for 2026, above the company’s five-year historical average. Despite expected EBITDA growth in 2026 driven by continued aggregate price increases and road construction growth, CRH declined 15%. The company’s EV/EBITDA multiple has contracted from 13x to 11.5x. CRH’s US listing status and exposure to infrastructure markets support its premium valuation. Most of its business, aside from fuel costs, has limited direct exposure to oil. Risks include demand uncertainty, ongoing inflation, M&A integration challenges, and foreign exchange headwinds.

Latest news shows CRH plc’s Q4 adjusted earnings fell short of analyst expectations, though revenue slightly exceeded forecasts. Following earnings, DA Davidson raised its target price, citing M&A activity.

Builders FirstSource Truist assigns a $145 target price based on a 14x EV/EBITDA multiple for 2026. The stock fell 12 last week, approaching a two-year low, due to rising interest rates. The firm notes that a decline in rates could trigger a significant rebound. Synergies from mergers and value-added product revenues support a higher-than-average multiple. Risks include a prolonged downturn in the real estate market, deteriorating consumer confidence, and volatility in commodity prices.

Builders FirstSource reported Q4 2025 earnings and revenue below analyst expectations. Subsequent analyst actions include RBC Capital upgrading the stock to outperform and Benchmark lowering its target price.

Somni Group Truist maintains a $115 target price, applying a 20x multiple to the 2026 EBITDA estimate. The stock has fallen 11% this year, mainly due to exposure to petrochemical raw materials. Truist views SGI as a self-improvement growth story. Risks include declines in discretionary spending, competitive pressures, changes in retail shelf space, and rising raw material costs.

Somni Group’s Q4 2025 revenue missed expectations, but earnings per share met forecasts. The company also reaffirmed its 2028 EPS target at its recent investor day.

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