Core & Main Inc (NYSE:CNM) is likely to be impacted by a minimal increase in spending in 2022 with delays in project starts, according to BofA Securities.
The Core & Main Analyst: Andrew Obin downgraded the rating for Core & Main from Neutral to Underperform, while reducing the price target from $31 to $25.
The Core & Main Thesis: The company’s near-term volume growth is likely to be muted, with pressure on gross margins, Obin said in the downgrade note.
“The BofA economics team forecasts a decline in non-resi spending and flattish single-family home starts. These trends suggest a potential 'dry spell' in volume growth in 2022,” the analyst wrote.
“The apparent demise of the Build Back Better Act lowers our expectations for further stimulus,” he added.
Obin reduced the adjusted earnings estimate for fiscal 2022 by 5 cents to $1.18 per share, which is lower than the consensus projection of $1.21 per share.
CNM Price Action: Shares of Core & Main had declined by 6.14% to $22.16 at the time of publication Thursday afternoon.
