Jim Cramer’s Latest Game Plan: 15 Stocks to Watch

7. Builders FirstSource, Inc. (NYSE:BLDR)

Number of Hedge Fund Holders: 59

Talking about Builders FirstSource, Inc.’s (NYSE:BLDR) Q3 report, Cramer said:

“Tuesday, we’ll hear from Builders FirstSource, the big distributor of housing supplies, and I bet they tell you the same thing I just said a few minutes ago: they need rates to go lower to have a lot of business to be reignited.”

Builders FirstSource (NYSE:BLDR) is a prominent manufacturer and supplier of building materials in the U.S. construction industry. The company offers a diverse range of products and services, including manufactured components and construction services, primarily targeting professional homebuilders, subcontractors, remodelers, and individual consumers. On November 5, it released its third-quarter earnings results, revealing a 6.7% drop in net sales, which totaled $4.2 billion.

This decline was largely attributed to a combination of lower core organic sales and commodity deflation, though the impact was partially offset by growth from acquisitions and an additional selling day during the quarter. Net income for the period fell by 36.9%, coming in at $284.8 million, or $2.44 per diluted share, compared to $3.59 per diluted share in the same quarter of the previous year.

Builders FirstSource (NYSE:BLDR) CEO Dave Rush remarked on the company’s acquisition activity, stating that the six acquisitions during the quarter are part of the company’s ongoing efforts to expand its portfolio of value-added offerings, which aim to strengthen its margins and improve overall financial performance.

During the earnings call, management said that the initial response to the Federal Reserve’s first interest rate cut in September has been mixed, with some homebuyers choosing to stay on the sidelines, awaiting further rate cuts as mortgage rates continue to fluctuate in the short term.