Oakmark Funds' Q2 2025 Investor Letter: Owens Corning (OC) Highlighted as a Strong Investment Opportunity

Oakmark Equity and Income Fund, advised by Harris Associates, highlighted Owens Corning (OC) in its Q2 2025 investor letter. OC is a residential and commercial building products manufacturer with a dominant market position in roofing and a management team that is taking advantage of its underpriced stock through share buybacks. The company reported revenue of $2.5 billion in Q1 2025, marking a 25% increase from Q1 2024.

Owens Corning (OC), a leading manufacturer of residential and commercial building products, has seen its stock price fluctuate in recent trading sessions. The company closed at $144.32 on the most recent trading day, down by 2.12% from the previous session. This performance trailed the S&P 500's daily gain of 0.14%, while the Dow and Nasdaq appreciated by 0.2% and 0.27%, respectively.

Over the past month, Owens Corning's shares have gained 9.63%, outpacing the 5.37% increase in the Construction sector and the 3.97% rise in the S&P 500. Analysts and investors are closely watching the company's upcoming earnings disclosure, expected to report earnings per share (EPS) of $3.8, a 18.1% decline from the same quarter last year. The consensus estimate also forecasts revenue of $2.7 billion, down 3.03% from the prior-year quarter.

For the annual period, Zacks Consensus Estimates anticipate earnings of $13.24 per share and revenue of $10.38 billion, indicating year-over-year declines of 16.78% and 5.46%, respectively. Investors should also note any recent changes to analyst estimates, as these can signify shifts in near-term business trends and influence stock performance.

Valuation metrics indicate that Owens Corning is trading at a discount compared to its industry peers. The company's Forward P/E ratio stands at 11.13, significantly lower than the industry average of 18.7. Additionally, Owens Corning's PEG ratio of 3.89 is higher than the industry average of 1.99. The Building Products - Miscellaneous industry, which includes Owens Corning, ranks 90 out of 250+ industries, placing it in the top 37%.

Oakmark Equity and Income Fund, advised by Harris Associates, highlighted Owens Corning in its Q2 2025 investor letter. The company reported revenue of $2.5 billion in Q1 2025, marking a 25% increase from the previous year. This strong performance underscores the company's dominant market position in roofing and its management team's strategic approach to leveraging its underpriced stock through share buybacks.

References:
[1] https://finance.yahoo.com/news/owens-corning-oc-stock-slides-220004140.html