Contractor pickup and stacked siding panels on a quiet suburban street as exterior projects pause.
United States, September 1, 2025
Shares of a leading siding manufacturer plunged nearly 35% after the company reported weaker fiscal first-quarter results, with net profit down about 28% and sales falling roughly 9%. Management attributed the decline to softer U.S. housing demand and homeowners deferring large exterior projects amid higher interest rates. Major home improvement retailers signaled similar consumer caution. Industry notes highlight that stucco remains a popular siding choice, a magnitude 4.1 quake rattled parts of the Southeast, and a private equity deal reshaped regional installer ownership, underscoring varied pressures across the exterior services market.
James Hardie, a maker of high-end home siding listed in both the United States and Australia, saw its shares fall by nearly 35% in a single trading day. The decline marked the company’s largest one-day percentage drop since the 1970s and followed a fiscal first-quarter report showing a 28% year-over-year drop in profit and a 9% fall in net sales. Company leaders attributed the setback to softer demand tied to a weak U.S. housing market and homeowners pausing on large remodeling jobs.
Turnover fell as single-family construction slowed, particularly across southern U.S. markets where new home starts have cooled. Higher interest rates have tightened borrowing for big projects that often need home equity lines or other loans, contributing to homeowners deferring major work such as re-siding. Builders and contractors report uncertainty when planning projects, and the overall market for big-ticket improvements has weakened.
Large home-improvement retailers have reported similar consumer caution, noting that elevated mortgage and borrowing costs are weighing on remodeling demand. While those retailers fared better in the market reaction to their quarterly results, they confirmed the same trend: customers are pausing or delaying projects that would typically require debt financing. Retailers also continue to manage cost pressures tied to trade policy and tariffs, while pointing out that a significant portion of their merchandise is sourced domestically, which can limit exposure to tariff-driven cost increases.
With homeowners more selective about when to spend on exterior upgrades, choices about materials and project timing are shifting. One long-standing exterior option, stucco, remains popular and is still among the top choices for single-family homes. Nearly a quarter of newly built single-family homes in recent reports featured stucco, making it the second-most used siding after vinyl. Modern stucco systems, including acrylic and insulated options, aim to address cracking and offer wider texture and finish choices.
Typical stucco installation is layered over house wrap and lath and commonly applied in three coats, with color and texture added in the final coat. Some newer systems require additional layers and specific materials such as foam board and fiberglass mesh. Industry practitioners generally advise against a do-it-yourself approach, noting that proper stucco application often needs a skilled crew and multiple installers.
Natural events can also affect repair and remodel demand. A recent 4.1 magnitude earthquake centered in eastern Tennessee was widely felt across parts of the Southeast, with tens of thousands of public reports within the first hour. The seismic waves traveled broadly due to eastern U.S. geology, and officials noted a small chance of a similar-sized aftershock in the week after the quake. The eastern Tennessee seismic zone is among the more active in the region and, while it does not often produce large events, it has generated quakes that caused minor damage in the past.
In corporate activity tied to exterior services, a majority stake in a regional full-service installer of siding, roofing, gutters and windows changed hands. The selling private equity firm will retain a minority stake and continue to back the business as the new investor takes a majority position. The company will keep its management team in place and continue serving a mix of national, regional and local homebuilders as well as homeowners across multiple Southeast states. The transaction follows a period of strategic expansion, investment in technology-enabled services and management growth.
Curb-appeal remains a priority in the South, where exterior charm is used to set expectations for interior spaces. Current trends include reimagined rooflines, careful use of shutters and dormers, textured or natural roofing materials, and combining classic materials like brick, stone and wood for layered, lasting looks. Designers recommend limiting exterior features to maintain balance, choosing properly scaled lighting and shutters, and favoring native landscaping to reduce upkeep. Front porches and well-placed outdoor seating continue to be seen as valuable additions that boost curb presence and practical use.
Weakness in single-family construction, higher borrowing costs and cautious homeowner spending combined to drive a sharp stock-market reaction for a major siding manufacturer. At the same time, material trends and regional service businesses are adapting with new systems, strategic deals and design pivots as homeowners and builders weigh when and how to invest in exterior projects.
The stock fell after the company reported lower profit and sales for the fiscal first quarter, while management cited weaker demand tied to a soft U.S. housing market and homeowners delaying large remodeling projects.
Yes. Stucco is widely used and remains the second-most common siding choice for single-family homes. New stucco systems have broadened its use beyond traditional regions by addressing previous limitations.
That depends on individual finances. Higher interest rates make debt-financed projects costlier, which is causing many homeowners to postpone large renovations. Smaller, cash-funded updates may still be practical.
The quake was widely felt and generated many public reports, but areas in the seismic zone typically see mostly minor events. Officials noted a low chance of a similar-sized aftershock in the short term.
The transaction signals continued consolidation and investment in regional exterior service providers, which can expand service reach and technology options for builders and homeowners in the Southeast.
| Topic | Key Detail |
|---|---|
| Stock movement | Nearly 35% single-day drop; largest since the 1970s; Q1 profit down 28%; sales down 9% |
| Market drivers | Weak single-family construction, high interest rates, consumers delaying large projects |
| Stucco | Used on ~25% of new single-family homes; applied in multiple coats; newer systems offer insulation and crack suppression |
| Seismic event | 4.1 magnitude quake in eastern Tennessee felt across several states; many public reports; low short-term aftershock risk |
| Regional deal | Majority stake sale of a Southeast exterior services firm; seller retains minority interest; management to stay on |
| Curb appeal trends | Focus on rooflines, balanced features, native landscaping, properly scaled lighting and refreshed porches |
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