James Hardie Industries (JHX) Stock Analysis & Winston Score

James Hardie Industries makes fiber cement building products, mainly siding and backer boards used on the outside of homes. Its customers are homebuilders, remodeling contractors, and homeowners across North America, Europe, and Australia. The company is the largest fiber cement siding manufacturer in the United States, and its HardiePlank brand is widely recognized in the residential construction market.

James Hardie earns revenue by selling its building products directly to distributors and big-box retailers, who then supply contractors and builders. North America generates the large majority of its sales, though it also has operations in Australia, New Zealand, and Europe. The company's main competitive advantage is its dominant market share in fiber cement, a material that resists rot, fire, and pests better than traditional wood siding. Its biggest risk is exposure to the US housing market — when new home construction or remodeling activity slows, demand for its products tends to fall with it.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+44.5% YoY

YoY Growth Rate

Revenue accelerating

EPS Growth

-50.9% YoY

YoY Growth Rate

Earnings declining

Insider Activity

0.5%ownership

Relatively low insider ownership

Cash Position

Cash flow positive

$564M cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Revenue accelerating

James Hardie Industries grew revenue 45% year-over-year and the growth rate is speeding up. That's the kind of momentum growth investors look for — the question is whether margins can follow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

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Quality

Gross Margin

37.3%

Modest — 37.3% gross margin

Operating Margin

11.9%

Modest — 11.9% operating margin

ROCE

1.5%

Weak — 1.5% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+28.5%

Fast-growing sales (28.5% YoY)

EPS YoY

-78.4%

Earnings shrinking (-78.4% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

0/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

621%

Turns 621% of profit into real cash

FCF Margin

3.2%

Thin free cash flow (3.2%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity

0.71

Moderate — manageable debt (0.71)

Interest Cover

2.76x

Tight — interest eats into profit (2.8x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)

118.2x

no trend

Expensive — P/E 118.2

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+100.4

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (118.2 → 17.8)

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Dividends

Not applicable for this business.

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