One-glance verdict
Overvalued
$109.25 our estimate vs market $173.34
Wall Street consensus: $209.70 (91.9% higher than our fair-value estimate)
59% above our estimate, beyond the bull case
Fundamentals snapshot
Armstrong World Industries, Inc.
AWI · NYQ · Industrials · Building Products & Equipment
Current price
$173.34
52-week range
$150.28 - $206.08
Market cap
$7.33B
Balance sheet
Watch
9.67x Adequate
Net debt $501.40M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 4.6% last year.
- Reward Returns 36.6% on equity, ahead of 66% of its peers.
- Reward Free cash flow was positive in 9/10 years.
- Risk Stock trades 10.5% above its 5-year average P/E.
What this company does
Armstrong World Industries, Inc.
Armstrong World Industries sells specialty ceilings and walls for commercial spaces like offices and schools, earning most of its money from mineral fiber ceiling tiles. The company's sales are tied to construction and renovation, and since many customers are replacing old ceilings, it enjoys a degree of recurring revenue (predictable, ongoing sales from a stable customer base).
How the company got here
Founded in 1860 in Pittsburgh as a two-man cork-cutting shop, Armstrong began by making cork stoppers for bottles. The company, originally named Armstrong Cork Company, grew to become the world's largest cork supplier by the 1890s. Over the years, it expanded its product lines to include insulation, fiberboard, and eventually ceiling and flooring materials. A significant turning point came in the early 2000s when the company filed for bankruptcy due to lawsuits related to asbestos, a material it had used in some products for decades. After reorganizing, the company emerged with a focus on ceiling and wall solutions, eventually selling off its flooring business to concentrate on the building products industry.
What it actually does
Armstrong World Industries designs and manufactures ceilings and walls for use in commercial and residential buildings. You've likely seen their products in offices, schools, hospitals, and retail stores, often as drop-ceiling tiles or specialty decorative walls. They make these products from a variety of materials, including mineral fiber, fiberglass, metal, and wood. The company sells its products mainly to distributors and contractors who then install them in new construction projects or building renovations.
Mineral Fiber
This is the company's largest and most traditional business, making up the majority of its sales. It produces the suspended ceiling systems you commonly see in commercial buildings, made from materials like mineral fiber and fiberglass. These are the standard grid ceilings that are good at absorbing sound and are relatively easy to install and access wiring or plumbing above them. Customers are typically building material distributors and ceiling system contractors who buy these products for both new buildings and renovations.
Architectural Specialties
This segment is a smaller but faster-growing part of the company that focuses on high-end, custom ceiling and wall designs. Think of decorative metal panels, wood grille ceilings, or custom felt walls you might see in a modern office lobby, airport, or university building. These products are sold for their specific look and performance features, often to architects and designers working on major renovation or new construction projects. This part of the business grows by creating new, innovative products and also by acquiring other companies with unique design and manufacturing capabilities.
What management is betting on now
The company's main strategy is to grow both of its business segments. For the core Mineral Fiber business, they are focused on innovation to create higher-value products, such as energy-saving ceiling tiles. In the Architectural Specialties segment, the plan is to expand by acquiring other companies and developing new, unique solutions for walls and ceilings. Management is also investing in digital tools to make things more efficient for their customers and to find new sources of demand (the total amount of a product or service that people are willing to buy).
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$77.10M
FY2024 Q4
$57.80M
FY2025 Q1
$21.90M
FY2025 Q2
$61.70M
FY2025 Q3
$100.30M
FY2025 Q4
$62.20M
FY2026 Q1
$14.40M
FY2026 Q2
$69.80M
Revenue
$472.00M
Net income
$96.70M
Diluted EPS
2.26
Operating cash flow
$93.80M
Free cash flow
$69.80M
Fetching…
Sources
Revenue
$409.90M
Net income
$66.80M
Diluted EPS
1.55
Operating cash flow
$32.10M
Free cash flow
$14.40M
Fetching…
Sources
Revenue
$388.30M
Net income
$65.50M
Diluted EPS
1.51
Operating cash flow
$110.00M
Free cash flow
$62.20M
Fetching…
Sources
Revenue
$425.20M
Net income
$86.30M
Diluted EPS
1.98
Operating cash flow
$122.90M
Free cash flow
$100.30M
Fetching…
Sources
Revenue
$424.60M
Net income
$87.80M
Diluted EPS
2.01
Operating cash flow
$81.60M
Free cash flow
$61.70M
Fetching…
Sources
Revenue
$382.70M
Net income
$69.10M
Diluted EPS
1.58
Operating cash flow
$41.00M
Free cash flow
$21.90M
Fetching…
Sources
Revenue
$367.70M
Net income
$62.20M
Diluted EPS
1.41
Operating cash flow
$86.60M
Free cash flow
$57.80M
Fetching…
Sources
Revenue
$386.60M
Net income
$76.90M
Diluted EPS
1.75
Operating cash flow
$96.50M
Free cash flow
$77.10M
Fetching…
Sources
Is it cheap or expensive?
Fair value $109.25 vs current price $173.34
Wall Street consensus is the average analyst price target: $209.70 (91.9% higher than our fair-value estimate).
Our most-likely fair value is $109.25 a share — about 37.0% below today's price of $173.34, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Watch
Net debt $501.4M. Interest coverage 9.7x.
Net debt
$501.40M
Interest coverage
9.67x
Armstrong World Industries, Inc.'s profit covers its interest bill about 9.7 times over. which is stronger than most peers shown here.
Watch
Worse cushion
Baseline
Better cushion
AWI
BASELINE
Armstrong World Industries, Inc.
Total debt $580.00M Interest coverage 9.67x This is the baseline the peer rows are being compared against.
Total debt $2.52B Interest coverage 28.63x +196% vs AWI Carries about 3.0x more debt cushion than AWI.
Total debt $6.02B Interest coverage 6.11x -37% vs AWI Carries about 1.6x less debt cushion than AWI.
Total debt $5.24B Interest coverage 2.87x -70% vs AWI Carries about 3.4x less debt cushion than AWI.
Total debt $3.49B Interest coverage 12.41x +28% vs AWI Carries about 1.3x more debt cushion than AWI.
Total debt $3.13B Interest coverage 7.63x -21% vs AWI Carries about 1.3x less debt cushion than AWI.
What you should know
The case for and against AWI
3 Rewards
1 Risk
Rewards
-
Revenue grew 4.6% last year.
-
Returns 36.6% on equity, ahead of 66% of its peers.
-
Free cash flow was positive in 9/10 years.
Risks
-
Stock trades 10.5% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
23.71x
Forward P/E
18.17x
P/B
8.30x
P/S
4.32x
EV/EBITDA
17.52x
PEG ratio
2.02x
Profitability
How much profit each dollar creates
Gross margin
40.3%
Operating margin
21.6%
Net margin
18.6%
ROE
36.6%
ROA
10.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.66x
Current ratio
1.52x
Quick ratio
0.97x
Total debt
$580.00M
Total cash
$78.60M
Growth
How the business has been compounding
Revenue TTM
$1.70B
Revenue 5Y CAGR
10.0%
EPS TTM
7.31
EPS 5Y CAGR
17.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$358.80M
Free CF TTM
$246.10M
FCF margin
14.5%
Dividend
Shareholder payout
Yield
0.8%
Payout ratio
18.1%
Last ex-div date
2026-08-05