Updated 4/14/25
Apogee Enterprises (APOG) is a Minnesota-based leader in architectural glass and framing systems, serving commercial construction across the U.S. With a history dating back to the early 1970s, the company has carved out a strong niche in non-residential building solutions. Under the leadership of CEO Ty Silberhorn, Apogee has focused on operational efficiency and higher-margin growth, highlighted by its recent Project Fortify initiative. Fiscal 2024 results reflected this shift, with record adjusted EPS, solid free cash flow, and disciplined capital allocation. Despite a recent pullback in share price, Apogee’s financial foundation remains strong, supported by a 2.24% dividend yield, low payout ratio, and consistent cash generation. The stock trades at a modest valuation, with analyst targets suggesting meaningful upside. Backed by an experienced leadership team and long-term strategic focus, Apogee continues to refine its business while maintaining steady income returns for shareholders.
Recent Events
Over the past year, Apogee’s stock has taken a noticeable dip, falling nearly 18%. The share price recently sat at $45.81, hovering just above its 52-week low of $42.33 and far off its high of $87.93. But while the price action may raise eyebrows, the company’s fundamentals haven’t unraveled.
Yes, quarterly earnings declined 22.2% year over year, but revenue still grew modestly at 0.5%. Operating margins held at a respectable 10.35%, and net profit margin came in at 7.14%. These numbers suggest a company that’s staying disciplined, even as growth temporarily slows.
Free cash flow remains strong, at over $90 million over the past twelve months, and the balance sheet is in solid shape. Debt stands at $341 million, but with a current ratio of 1.63 and ample cash generation, there’s no red flag here. Even in a more tepid revenue environment, Apogee is managing capital effectively and producing steady returns.
Key Dividend Metrics
💵 Forward Annual Dividend Yield: 2.24%
📈 5-Year Average Dividend Yield: 2.08%
📊 Payout Ratio: 22.37%
💰 Forward Dividend Rate: $1.04 per share
🕒 Ex-Dividend Date: January 28, 2025
📆 Last Dividend Payment: February 12, 2025
These dividend metrics don’t scream excitement, but they whisper reliability—and for income-focused investors, that’s often a more valuable quality.
Dividend Overview
The current yield of 2.24% edges out Apogee’s five-year average and comfortably tops the broader market average. It’s not an eye-popping payout, but it’s dependable and, more importantly, sustainable. That’s what separates a solid dividend stock from one that’s simply masking weak growth.
The payout ratio sits at just over 22%, which is incredibly conservative. That kind of margin means Apogee can continue to pay—and even raise—its dividend without straining its cash flows or resorting to debt.
What’s more, the company isn’t just cutting checks to shareholders; it’s also investing in itself. Operating cash flow totaled $170 million over the past year, which leaves plenty of room to reinvest in the business while also rewarding shareholders. That balance is key to building long-term dividend reliability.
Apogee’s dividend doesn’t rely on temporary cost cuts or one-time boosts. It’s funded by consistent cash generation and careful management, making it appealing for investors looking for steady income without drama.
Dividend Growth and Safety
If you’re in this for the long haul, it’s the dividend growth story that might seal the deal. Apogee has been steadily increasing its payout over the years—from $0.64 per share in 2019 to $1.04 today. That’s a 62.5% boost in just six years. For a company operating in construction-related sectors, that’s a testament to discipline and shareholder alignment.
There’s a reassuring sense of caution in how Apogee handles its dividend. The low payout ratio gives it a buffer against earnings fluctuations, and the business continues to generate free cash flow well above the level needed to support dividends.
On the safety front, there are more green flags. Return on equity is a robust 20.11%, and return on assets is over 9%, both pointing to efficient use of capital. The company holds $44.57 million in cash, giving it added flexibility even in tougher quarters. And with a low beta of 0.84, Apogee tends to move less than the broader market—offering a smoother ride for income investors.
While the market may not be overly enthusiastic right now, dividend investors should take comfort in the consistency. Apogee is still doing what it’s always done—running a tight ship, returning capital to shareholders, and keeping risk in check. For income-focused portfolios, that’s exactly the kind of foundation that holds firm when flashier stories lose their shine.
Cash Flow Statement
Apogee’s trailing twelve-month cash flow paints a clear picture of a company generating consistent internal strength while managing capital spending with a long-term mindset. Operating cash flow over the TTM period came in at $170 million, slightly down from last year’s $204 million but still solidly ahead of levels seen in 2022 and 2021. What stands out is how efficiently the company turns its earnings into cash, maintaining a free cash flow of $129 million—healthy by any standard.
The biggest swing came from investing activities, which saw a sharp increase in outflows to $274 million. This indicates a significant reinvestment push, possibly related to acquisitions or capacity expansion, reflecting strategic growth moves. On the financing side, Apogee added back $125 million in cash, largely reversing a trend of multi-year outflows. Debt repayments remained substantial at $175 million, while stock buybacks were dialed back slightly to $15 million. Despite the high investing spend, cash on hand improved to $43.8 million, which shows that Apogee is balancing reinvestment with financial flexibility—a sign of solid capital stewardship.
Analyst Ratings
📈 Apogee Enterprises (NASDAQ: APOG) has recently seen a shift in analyst sentiment, reflecting a mix of optimism and cautious realism.
🔼 Sidoti & Co. upgraded the stock from Neutral to Buy, setting a price target of $70. This change signals renewed confidence in Apogee’s strategic direction and its ability to maintain earnings strength, even amid a softer construction environment. The firm pointed to improved operating efficiencies and strong free cash flow as reasons for their more favorable outlook.
🔽 On the other hand, DA Davidson maintained its Neutral rating but revised its price target downward from $75 to $62. While still supportive of the company’s fundamentals, the adjustment reflects concerns about macroeconomic pressures in commercial construction and a possibly slower order pipeline in the near term.
📊 Across the board, the consensus rating for APOG sits at Moderate Buy, with the average price target coming in at $62.00. That suggests a potential upside of about 33% from the current share price near $46. The range of analyst expectations is fairly tight, with targets spanning from $62 on the low end to $70 on the high end, indicating general alignment on the stock’s valuation potential.
🔍 The takeaway here is that analysts recognize Apogee’s strong financial discipline and see room for recovery, especially as broader economic conditions stabilize.
Earning Report Summary
Apogee Enterprises just closed out fiscal 2024, and the results came in stronger than many expected, especially considering the broader challenges in the commercial construction space. The company saw a nice 5.2% bump in fourth-quarter net sales, hitting $361.8 million. That growth was driven by a mix of improved pricing and a better overall product mix. Volumes were down a bit, which held things back slightly, but it didn’t stop them from expanding profit margins and improving their bottom line.
Margins and Profitability Moving in the Right Direction
Gross profit for the quarter climbed to $88.5 million, which is up more than 13% from the same period a year ago. What’s even more encouraging is that gross margins improved by 170 basis points, reaching 24.4%. That kind of gain usually means the company is not only charging more for its products but also controlling costs more effectively. A big part of that came from cost-savings tied to their ongoing operational improvements and the early impact of Project Fortify, a company-wide initiative aimed at driving long-term efficiency.
Operating income for the quarter came in at $21.9 million, with an adjusted figure of $34.3 million once one-time costs were stripped out. That led to adjusted operating margins hitting 9.5%, a solid improvement from last year. Adjusted earnings per share jumped to $1.14, which is a healthy 33% gain year over year.
A Record Year in Many Ways
For the full fiscal year, total sales landed at $1.42 billion, just a shade below last year. But here’s where it gets interesting: despite the slight dip in revenue, profitability improved. Adjusted operating margins moved up to 10.3%, and full-year adjusted EPS hit a record $4.77. That’s nearly 20% higher than the year before, which speaks volumes about how well they’re managing operations even with flat top-line growth.
CEO Ty Silberhorn was upbeat in his comments, calling it a year of record performance in both earnings and cash flow. He credited their focused execution and smarter operations, saying these changes are giving Apogee a stronger foundation to build on going forward. A big part of their strategy involved trimming lower-margin parts of the business, improving customer service, and doubling down on higher-value work.
Looking Ahead to Fiscal 2025
The outlook for 2025 is a bit more cautious on the revenue side. Apogee expects a slight dip in sales—between 4% and 7% lower—mostly because of the way the fiscal calendar shifts back to 52 weeks and the ongoing impact of Project Fortify. But on the earnings front, they still expect strong results, guiding for adjusted EPS between $4.35 and $4.75.
One area that really stood out was cash flow. In the fourth quarter alone, Apogee generated nearly $75 million in operating cash. For the year, they brought in a record $204 million. That strength allowed them to pay down debt significantly—dropping their long-term debt from nearly $170 million to just $62 million—and return $33 million to shareholders through buybacks and dividends. The balance sheet looks clean, and the company’s clearly in a strong position to keep building from here.
Chart Analysis
Price Trend and Moving Averages
APOG’s chart over the past year tells a clear story of momentum shift. The stock was in a steady uptrend from spring through late fall, supported by a rising 50-day moving average that stayed above the 200-day moving average. That strength peaked around late November, when the stock touched highs above $85. After that, the tone changed. The price began to slide, and the 50-day moving average turned sharply lower. By early this year, the 50-day crossed below the 200-day line—a classic sign of a longer-term trend reversal.
The stock has been making lower highs and lower lows since January, with the price now sitting near $46, just above its 52-week low. The declining slope of both moving averages confirms that the downward trend is well-established. It’s worth noting that the stock is now significantly below both key moving averages, suggesting it’s in oversold territory from a technical perspective.
Volume Activity
Volume has been fairly muted for most of the year, but there was a noticeable spike in January as the stock broke down below the $60 mark. That surge in selling volume likely marked a key distribution phase, where institutional holders began trimming positions. Since then, volume has stayed steady but not aggressive, indicating that while selling has slowed, there isn’t strong buying interest stepping in yet either.
Relative Strength Index (RSI)
The RSI has been telling its own story, hovering below 50 for most of the past three months. This suggests the stock has remained under consistent selling pressure. There were brief moments where RSI pushed toward the neutral zone, but it hasn’t made any real attempt to enter overbought territory since late last year. Most recently, the RSI sits just above the 50 line, hinting at some stabilization—but no clear momentum shift yet.
Current Price Behavior
Looking at the last five candles on the chart, there’s a pattern of small-bodied candles with lower wicks, indicating some degree of buying interest at the lows. But the absence of any large bullish candles shows that buyers remain tentative. The stock hasn’t been able to close meaningfully higher in recent sessions, and the slope of the 50-day average remains steeply downward.
The big picture here is one of a stock that’s gone from strength to weakness, with technical signals confirming that sellers have had the upper hand since the start of the year. That said, with RSI stabilizing and the price nearing long-term support, it’s worth keeping an eye on for signs of a potential base forming. But for now, the trend is still clearly down.
Management Team
Apogee Enterprises is led by CEO Ty Silberhorn, who stepped into the role in early 2021. With more than twenty years of experience at 3M, Silberhorn brought with him a strong foundation in operational leadership and organizational transformation. Since joining Apogee, he’s focused on driving profitability, streamlining operations, and positioning the company for long-term value creation.
The broader leadership team reflects a similar focus on strategic execution. Veena Lakkundi, Executive Vice President of Strategy and Growth, joined Apogee with a track record in corporate development and long-range planning. Michelle Roemer, serving as Chief Information Officer, leads digital modernization efforts across the business. Raelyn Trende, the company’s Chief Human Resources Officer, is focused on strengthening talent strategy and building an adaptive organizational culture.
This team has been the driving force behind Project Fortify, Apogee’s internal initiative to exit lower-margin segments and sharpen the company’s competitive edge. Their collective experience across global operations, finance, strategy, and technology puts them in a strong position to manage through industry cycles while building a more resilient and focused enterprise.
Valuation and Stock Performance
Apogee (APOG) is currently trading just below $46, which is well off its 52-week high and closer to the low end of its range. While the stock has underperformed over the past year—down nearly 18%—valuation metrics suggest the market may be overlooking the company’s core strengths.
The trailing price-to-earnings ratio stands at 10.4, which is significantly lower than many of its peers in the building products space. The company’s price-to-book ratio is under 2, and its EV/EBITDA is around 7.6, both of which point to relatively modest expectations baked into the share price. For investors focused on valuation discipline, those numbers could indicate an entry point, especially considering the company’s return on equity is over 20%.
Analysts covering the stock have set an average price target around $62, which implies a potential upside of roughly 35% from where it’s trading today. There’s clearly some disconnect between the market’s current view and the underlying fundamentals, and that gap could narrow if execution continues on the current path.
Risks and Considerations
As with any company tied to the construction cycle, Apogee’s results can be influenced by shifts in non-residential building demand. A slowdown in commercial development or tighter lending environments could create headwinds. Project delays and budget constraints among clients are always a possibility, especially in a higher-rate climate.
The business also carries some exposure to raw material volatility, particularly in aluminum and glass. Although the company has done well managing costs and passing along price increases, sudden spikes or supply disruptions could weigh on margins.
Another factor worth watching is the competitive environment. Apogee operates in a fragmented industry where pricing pressure and service expectations are high. The decision to exit lower-margin areas through Project Fortify could help improve profitability over time, but it may also reduce overall sales in the near term.
Leverage is moderate, with a debt-to-equity ratio around 65%, and the company has done a good job bringing down its long-term debt. Still, interest expense will need to be monitored if rates remain elevated or rise further. Execution of operational initiatives and maintaining cost discipline remain critical to sustaining the recent improvement in profitability.
Final Thoughts
Apogee Enterprises has gone through a period of strategic transformation, and it’s beginning to show up in the numbers. The leadership team has been aggressive in reshaping the business, prioritizing profitability over raw growth, and the early results are encouraging. Record cash flow, rising margins, and a disciplined capital allocation approach have started to rebuild investor confidence—even if the stock price hasn’t yet followed.
Valuation remains attractive, especially for those with a longer time horizon. The business model is stable, cash flow is strong, and the dividend is well-covered with room for growth. While short-term risks tied to construction activity and input costs remain, the company is positioning itself to ride out those bumps.
With the leadership’s focus on long-term value creation and a cleaner, leaner operational profile, Apogee is setting the stage for a more stable and potentially rewarding future. Investors looking for a business that prioritizes execution and shareholder returns might find what they’re looking for here.