One-glance verdict
Undervalued
$135.03 our estimate vs market $112.50
Wall Street consensus: $120.47 (-10.8% lower than our fair-value estimate)
17% below our estimate, below the bear case
Fundamentals snapshot
Mohawk Industries, Inc.
MHK · NYQ · Consumer Cyclical · Furnishings, Fixtures & Appliances
Current price
$112.50
52-week range
$92.99 - $143.13
Market cap
$6.86B
Balance sheet
Healthy
28.63x Strong cushion
Net debt $1.65B. 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 1.9% last year.
- Reward Returns 5.1% on equity, ahead of 20% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Risk Operating margin compressed from 8.0% to 5.5% over 3 years.
What this company does
Mohawk Industries, Inc.
Mohawk Industries is one of the world's largest flooring companies, making products you'd recognize like carpets, tile, laminate, and wood floors for homes and businesses. The company's sales are heavily tied to new construction and home remodeling, so its business tends to do well when more people are building and renovating houses. This means its performance is a good indicator of the health of the overall housing market.
How the company got here
Mohawk Industries began in 1878 when the Shuttleworth brothers started a carpet mill in Amsterdam, New York. For many years, they focused on making woven carpets. A big change came in 1988 when the carpet business was spun off from its parent company to form the modern Mohawk Industries. Since going public in 1992, the company has grown dramatically by acquiring other flooring companies, expanding from a U.S. carpet maker into the world's largest flooring company with a wide variety of products.
What it actually does
Mohawk Industries is the world's largest flooring manufacturer, making floor coverings for homes as well as commercial buildings like offices and stores. Their products include a vast range of options, from soft flooring like carpets and rugs to hard surfaces like ceramic tile, laminate, wood, and vinyl flooring. They also produce countertops and, in Europe, sell building materials like insulation and panels. You can find their products sold under many different brand names, such as Mohawk, Daltile, Pergo, and Karastan.
Global Ceramic
This is the company's largest business segment, making up about 39% of its sales. It produces and sells ceramic, porcelain, and natural stone tiles for both floors and walls, as well as quartz and stone countertops. This division operates all over the world, with a strong presence in North America, Europe, and South America. Customers for these products range from individual homeowners doing renovations to large commercial builders.
Flooring North America
This segment focuses on the North American market and accounts for roughly a third of the company's revenue. It is a leading producer of carpet, which was the company's original business, but also sells a wide variety of other flooring like laminate, luxury vinyl tile (LVT), and wood flooring. This part of the company sells to home centers, specialty flooring retailers, and directly to builders.
Flooring Rest of the World
This division handles flooring sales outside of North America, primarily in Europe, Australia, and New Zealand, and makes up the remainder of the company's revenue. It is a major seller of hard surface flooring like laminate and vinyl, and also produces carpet and wood flooring. Uniquely, this segment also manufactures and sells other building materials in Europe, such as insulation and panels for furniture and construction. It also makes money by licensing its flooring technology patents to other manufacturers.
What management is betting on now
The company is focused on expanding its presence in growing markets, particularly for ceramic tiles in Latin America. They are also investing in making more premium and innovative products, like waterproof laminate and flooring made from recycled materials, to meet changing consumer tastes. Another key priority is improving efficiency in their factories through automation and cost-cutting to increase profitability (the amount of profit made from sales). Management also plans to continue acquiring other companies to enter new markets and strengthen their position in existing ones.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$204.20M
FY2024 Q4
$236.20M
FY2025 Q1
$-85.40M
FY2025 Q2
$126.10M
FY2025 Q3
$310.30M
FY2025 Q4
$265.20M
FY2026 Q2
$7.80M
Revenue
$2.73B
Net income
$117.10M
Diluted EPS
1.90
Operating cash flow
$110.10M
Free cash flow
$7.80M
Fetching…
Sources
Revenue
$2.70B
Net income
$42.00M
Diluted EPS
0.69
Operating cash flow
$459.60M
Free cash flow
$265.20M
Fetching…
Sources
Revenue
$2.76B
Net income
$108.80M
Diluted EPS
1.75
Operating cash flow
$386.60M
Free cash flow
$310.30M
Fetching…
Sources
Revenue
$2.80B
Net income
$146.50M
Diluted EPS
2.34
Operating cash flow
$206.30M
Free cash flow
$126.10M
Fetching…
Sources
Revenue
$2.53B
Net income
$72.60M
Diluted EPS
1.15
Operating cash flow
$3.70M
Free cash flow
$-85.40M
Fetching…
Sources
Revenue
$2.64B
Net income
$93.30M
Diluted EPS
1.49
Operating cash flow
$397.00M
Free cash flow
$236.20M
Fetching…
Sources
Revenue
$2.72B
Net income
$162.00M
Diluted EPS
2.55
Operating cash flow
$319.60M
Free cash flow
$204.20M
Fetching…
Sources
Is it cheap or expensive?
Fair value $135.03 vs current price $112.50
Wall Street consensus is the average analyst price target: $120.47 (-10.8% lower than our fair-value estimate).
Our most-likely fair value is $135.03 a share — about 20.0% above today's price of $112.50, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $1.7B. Interest coverage 28.6x.
Net debt
$1.65B
Interest coverage
28.63x
Mohawk Industries, Inc.'s profit covers its interest bill about 28.6 times over. which is stronger than every peer shown here.
Healthy
Worse cushion
Baseline
Better cushion
MHK
BASELINE
Mohawk Industries, Inc.
Total debt $2.52B Interest coverage 28.63x This is the baseline the peer rows are being compared against.
Total debt $2.01B Interest coverage 23.97x -16% vs MHK Carries about 1.2x less debt cushion than MHK.
Total debt $570.60M Interest coverage 9.67x -66% vs MHK Carries about 3.0x less debt cushion than MHK.
Total debt $3.30B Interest coverage 12.41x -57% vs MHK Carries about 2.3x less debt cushion than MHK.
Total debt $6.02B Interest coverage 6.11x -79% vs MHK Carries about 4.7x less debt cushion than MHK.
What you should know
The case for and against MHK
3 Rewards
1 Risk
Rewards
-
Revenue grew 1.9% last year.
-
Returns 5.1% on equity, ahead of 20% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Operating margin compressed from 8.0% to 5.5% over 3 years.
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)
16.87x
Forward P/E
11.36x
P/B
0.82x
P/S
0.62x
EV/EBITDA
5.92x
PEG ratio
0.64x
Profitability
How much profit each dollar creates
Gross margin
25.3%
Operating margin
5.5%
Net margin
3.8%
ROE
5.1%
ROA
3.4%
Health
Liquidity and balance-sheet strength
Debt / equity
0.30x
Current ratio
2.16x
Quick ratio
1.03x
Total debt
$2.52B
Total cash
$872.30M
Growth
How the business has been compounding
Revenue TTM
$10.99B
Revenue 5Y CAGR
-0.9%
EPS TTM
6.67
EPS 5Y CAGR
147.7%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.16B
Free CF TTM
$616.20M
FCF margin
5.6%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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