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James Hardie: Initiation of Coverage – Decking Strength Meets A Softer Housing Market!

James Hardie Industries plc reported fiscal 2026 results reflecting resilience amidst a challenging construction and housing market environment. The company recorded net sales of $4.8 billion for the full year, representing a 25% increase largely driven by the AZEK acquisition, though organic net sales declined 2%. Adjusted EBITDA reached $1.3 billion with a margin of 26.2%, supported by operational discipline and cost management despite inflationary and integration-related expenses. Free cash flow was $314 million, affected by integration costs but expected to improve significantly in fiscal 2027. The fiber cement segment experienced a decline in organic volumes throughout fiscal 2026, attributed in part to weather disruptions and a softer remodeling and repair (R&R) market. However, leadership expressed confidence in returning this segment to growth in fiscal 2027, driven by targeted regional initiatives in the underpenetrated Northeast and Midwest U.S.