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1. Company Snapshot

1.a. Company Description

Apogee Enterprises, Inc.designs and develops glass and metal products and services in the United States, Canada, and Brazil.The company operates in four segments: Architectural Framing Systems, Architectural Glass, Architectural Services, and Large-Scale Optical Technologies (LSO).


The Architectural Framing Systems segment designs, engineers, fabricates, and finishes the aluminum frames used in customized aluminum and glass window; curtain wall; storefront; and entrance systems, such as the outside skin and entrances of commercial, institutional, and multi-family residential buildings.The Architectural Glass segment fabricates coated and high-performance glass used in customized window and wall systems, including the outside skin of commercial, institutional, and multi-family residential buildings.The Architectural Services segment offers full-service installation of the walls of glass, windows, and other curtain wall products making up the outside skin of commercial and institutional buildings.


The LSO segment manufactures value-added glass and acrylic products for framing and display applications.The company's products and services are primarily used in commercial buildings, such as office buildings, hotels, and retail centers; and institutional buildings comprising education facilities, health care facilities, and government buildings, as well as multi-family residential buildings.It markets its architectural products and services through direct sales force, independent sales representatives, and distributors to glazing subcontractors and general contractors; and value-added glass and acrylics through retail chains, picture-framing shops, and independent distributors to museums, galleries, and other customers.


The company was incorporated in 1949 and is based in Minneapolis, Minnesota.

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1.b. Last Insights on APOG

Apogee Enterprises' recent performance was negatively impacted by high costs and supply challenges. Despite solid segment gains and pricing actions, the company's Q2 earnings revealed margin pressure, prompting a downward revision of its FY26 outlook. The upcoming CEO transition, with Donald A. Nolan succeeding Ty R. Silberhorn, may add to near-term uncertainty. Additionally, revenue growth driven by acquisitions was offset by weakening organic sales and profitability due to higher costs and tariffs. Adjusted net profits are forecasted to decline.

1.c. Company Highlights

2. Apogee Enterprises Delivers Strong Q1 Results, Raises Fiscal 2026 Outlook

Apogee Enterprises' Q1 2026 results surpassed expectations, with net sales rising 4.6% year-over-year to $346.6 million, bolstered by the acquisition of UW Solutions. The company reported an adjusted EBITDA margin of 9.9% and adjusted diluted EPS of $0.56, beating consensus estimates of $0.50. Despite higher aluminum costs and tariffs impacting profitability, Apogee demonstrated resilience through operational efficiency and strategic initiatives. Management raised its fiscal 2026 outlook, forecasting net sales between $1.40 and $1.44 billion and adjusted EPS in the range of $3.80 to $4.20, reflecting confidence in tariff mitigation efforts and growth in key segments like Performance Surfaces.

Publication Date: Jul -02

📋 Highlights
  • Net Sales Growth: - 4.6% increase to $346.6 million, driven by strong performance in Glass and Services.
  • Adjusted EBITDA Margin: - 9.9% margin achieved, supported by operational efficiency despite higher aluminum costs.
  • Raised Fiscal 2026 Outlook: - Net sales expected to reach $1.40 to $1.44 billion, with adjusted EPS of $3.80 to $4.20.
  • Project Fortify Phase 2 Savings: - On track to deliver $13 to $15 million in annual savings, with significant impact expected in Q2.
  • Tariff Impact Mitigation: - Revised annual EPS impact of $0.35 to $0.45 due to favorable cost management and operational efficiency.

Operational Insights and Strategic Progress

Project Fortify Phase 2 remains on track to deliver $13 to $15 million in annual savings, with minimal impact in Q1 but significant benefits expected in Q2, particularly after the closure of the Canadian facility. The Metals segment showed sequential improvement, while Glass and Performance Surfaces are poised to drive growth in Q3 and Q4. Management emphasized the importance of operational efficiency and cost management, with tariff impacts revised downward to $0.35 to $0.45 annually due to favorable cost management and operational shifts. The Services backlog declined to $683 million, attributed to market softness rather than selective project rejection, as the team focuses on smaller, more diverse projects while maintaining margins.

M&A and Growth Strategy

Apogee continues to explore strategic M&A opportunities, though activity has slowed due to macroeconomic challenges. Sellers are cautious about valuations, but multiples have remained stable. The company is broadening its range of opportunities due to the tariff environment but has not adjusted its target pipeline. Management remains optimistic about future results, driven by a focus on expanding market reach and product offerings.

Valuation and Outlook

With a P/E ratio of 10.94 and a P/B ratio of 1.91, Apogee's valuation reflects its stable growth prospects and operational improvements. The company's EV/EBITDA of 7.54 and dividend yield of 2.36% further highlight its attractive risk-reward profile. Analysts expect revenue growth of 3.0% next year, aligning with management's upbeat outlook. The stock's current valuation appears to price in the expected improvement in the second half of the fiscal year, driven by tariff mitigation and growth in key segments.

3. NewsRoom

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Apogee Enterprises Announces CEO Transition

Oct -31

Source: businesswire.com

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Apogee Surpasses Earnings Estimates in Q2, Lowers FY26 Outlook

Oct -10

Source: zacks.com

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Apogee Enterprises, Inc. (APOG) Q2 2026 Earnings Call Transcript

Oct -10

Source: seekingalpha.com

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Apogee to Report Q2 Earnings: What's in the Cards for the Stock?

Oct -06

Source: zacks.com

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Apogee Enterprises Announces Date for Fiscal 2026 Second Quarter Results

Sep -30

Source: businesswire.com

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Apogee Bets on Momentum in Segments & Pricing Actions Amid High Costs

Sep -25

Source: zacks.com

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Apogee Enterprises: Even In Light Of Recent Weaknesses, It Will Be Fine

Sep -18

Source: seekingalpha.com

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2 Stocks to Buy From the Prospering Glass Products Industry

Aug -26

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.02%)

6. Segments

Architectural Framing Systems

Expected Growth: 4.83%

Apogee Enterprises' Architectural Framing Systems segment growth of 4.83% is driven by increasing demand for energy-efficient and sustainable building solutions, rising construction activities in the commercial and residential sectors, and strategic acquisitions expanding product offerings and geographic presence.

Architectural Glass

Expected Growth: 4.65%

Apogee Enterprises' Architectural Glass segment growth of 4.65% is driven by increasing demand for energy-efficient buildings, government incentives for green infrastructure, and rising construction spending in the commercial and residential sectors. Additionally, the company's focus on innovative products and strategic acquisitions have contributed to its growth momentum.

Architectural Services

Expected Growth: 4.83%

Apogee Enterprises, Inc.'s Architectural Services segment growth of 4.83% is driven by increasing demand for energy-efficient and sustainable building solutions, government incentives for green infrastructure, and a strong backlog of projects in the education and healthcare sectors.

Large-Scale Optical

Expected Growth: 8.33%

Apogee Enterprises' Large-Scale Optical segment growth of 8.33% is driven by increasing demand for energy-efficient architectural glass, rising adoption of smart glass technologies, and growing investments in renewable energy projects. Additionally, the segment benefits from Apogee's strong relationships with top architectural firms and its ability to provide customized solutions.

Intersegment Elimination

Expected Growth: 4.83%

Apogee Enterprises, Inc.'s 4.83% intersegment elimination growth is driven by increasing architectural glass sales, robust project backlog, and strategic acquisitions. Additionally, cost savings initiatives and operational efficiencies have contributed to the growth. The company's focus on innovation, sustainability, and customer relationships has also enhanced its competitive position, leading to improved financial performance.

7. Detailed Products

Architectural Glass

Apogee Enterprises, Inc. provides architectural glass products, including coated, tinted, and low-e glass for commercial and residential buildings.

Architectural Framing Systems

The company offers architectural framing systems, including aluminum frames, entrance systems, and curtain wall systems.

Window Systems

Apogee Enterprises, Inc. provides window systems, including vinyl, aluminum, and wood windows for new construction and replacement markets.

Installation Services

The company offers installation services for its products, including glazing, window installation, and curtain wall installation.

Glass and Metal Solutions

Apogee Enterprises, Inc. provides glass and metal solutions, including glass fabrication, metal fabrication, and glass lamination.

8. Apogee Enterprises, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Apogee Enterprises, Inc. operates in a niche market with limited substitutes, but there are some alternatives available, making the threat of substitutes medium.

Bargaining Power Of Customers

Apogee Enterprises, Inc. has a diverse customer base, which reduces the bargaining power of individual customers, making the bargaining power of customers low.

Bargaining Power Of Suppliers

Apogee Enterprises, Inc. relies on a few key suppliers, which gives them some bargaining power, making the bargaining power of suppliers medium.

Threat Of New Entrants

Apogee Enterprises, Inc. operates in a capital-intensive industry with high barriers to entry, making it difficult for new entrants to join the market, making the threat of new entrants low.

Intensity Of Rivalry

Apogee Enterprises, Inc. operates in a highly competitive industry with many established players, making the intensity of rivalry high.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 13.62%
Debt Cost 8.15%
Equity Weight 86.38%
Equity Cost 9.26%
WACC 9.11%
Leverage 15.77%

11. Quality Control: Apogee Enterprises, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Ennis

A-Score: 6.7/10

Value: 7.2

Growth: 4.1

Quality: 7.2

Yield: 10.0

Momentum: 2.5

Volatility: 9.0

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Perma-Pipe International Holdings

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Growth: 6.8

Quality: 5.8

Yield: 0.0

Momentum: 10.0

Volatility: 1.3

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Apogee Enterprises

A-Score: 4.7/10

Value: 6.3

Growth: 6.1

Quality: 4.7

Yield: 5.0

Momentum: 0.5

Volatility: 5.7

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Gibraltar Industries

A-Score: 4.2/10

Value: 3.6

Growth: 6.8

Quality: 5.1

Yield: 0.0

Momentum: 4.0

Volatility: 5.7

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Quanex Building Products

A-Score: 3.6/10

Value: 7.8

Growth: 5.1

Quality: 2.6

Yield: 3.0

Momentum: 0.0

Volatility: 3.3

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BlueLinx

A-Score: 3.4/10

Value: 6.0

Growth: 5.8

Quality: 3.2

Yield: 0.0

Momentum: 1.5

Volatility: 4.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

37.65$

Current Price

37.65$

Potential

-0.00%

Expected Cash-Flows