James Hardie Industries plc. Ordinary Shares (JHX)

FairStock Score: 32/100 — RISKY

Key Financials

Strengths

• Generates $300 million in annual free cash flow (2.3% yield on market cap)
• Revenue growth of 30.1% demonstrates strong top-line momentum

Concerns

• Trades significantly above Graham Number ($8) with negative 189% margin of safety—limited downside protection
• Altman Z-Score of 1.4 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

James Hardie Industries plc. Ordinary Shares is a mid-cap basic materials company valued at $12.9 billion. The business generates $4.4 billion in annual revenue with a 1.6% net margin and $300 million in free cash flow. From a quality standpoint, James shows solid Piotroski F-Score of 6/9 and distressed Altman Z-Score of 1.4 warrants caution. On valuation, the stock is commanding a steep 91.3x multiple, with trades far above its Graham Number ($8) with no margin of safety. Growth dynamics show revenue growing at 30.1% and profit growth of -51.5%. Our composite FairStock Score of 32/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

James's 30% revenue growth trajectory could accelerate as it captures additional market share in the basic materials sector. With $300 million in annual free cash flow (2.3% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 91x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer