Last Update 5/8/25
Griffon Corporation (GFF) operates through two core segments: Home and Building Products, and Consumer and Professional Products. With brands like Clopay and AMES under its umbrella, the company serves both residential and commercial markets, generating over \$2.6 billion in annual revenue. Leadership has emphasized operational efficiency, steady margin expansion, and a disciplined approach to capital allocation, including dividends and share repurchases.
Backed by a strong management team and consistent free cash flow—over \$305 million in the trailing twelve months—Griffon is navigating a slower demand environment while maintaining profitability. The company continues to return capital to shareholders, strengthen its balance sheet, and invest in long-term value creation.
Recent Events
Griffon’s stock took a bit of a hit recently, closing at $67.90 on May 7, down about 2.5% on the day. But it popped back in early trading to $69.20, showing a little resilience. Zooming out a bit, the numbers tell a clearer story. While revenue has been a touch soft—down 1.7% year-over-year—earnings have gone the other way. Net income jumped 68% over the same period, which points to better margins and stronger operational execution.
The operating margin now stands at an impressive 17.77%, and return on equity has surged past 90%. That kind of profitability isn’t typical for industrials of this size. It helps that Griffon’s been more selective about where it’s putting its resources. While it still carries a hefty debt load—$1.66 billion, to be exact—it also has a healthy $151 million in cash and continues to generate strong free cash flow.
Cash flow is really where this story gets interesting. Over the past year, Griffon pulled in nearly $377 million in operating cash flow, with more than $315 million in levered free cash flow. That gives it plenty of flexibility—whether to pay down debt, buy back stock, or, of course, pay and grow its dividend.
Key Dividend Metrics
📈 Forward Dividend Yield: 1.06%
💸 Trailing 12-Month Dividend: $0.63 per share
📅 Most Recent Dividend Date: March 18, 2025
📆 Ex-Dividend Date: February 25, 2025
📊 Payout Ratio: 12.86%
📉 5-Year Average Yield: 1.15%
These figures might not scream “income stock,” but when you look closer, they’re actually part of a thoughtful and measured capital return story.
Dividend Overview
Griffon’s dividend doesn’t look like much at first glance. A 1.06% forward yield sits just below its five-year average, and it’s easy to overlook. But that would be missing the bigger picture.
The stock price has been climbing steadily over the past couple of years, which has compressed the yield. It’s not that the dividend hasn’t moved—rather, the share price has moved up faster. That’s actually not a bad problem to have. It shows investor confidence and gives the company flexibility.
More important is the payout ratio, which is sitting at a low 12.86%. That tells us Griffon is keeping most of its earnings for reinvestment, debt reduction, or future dividend increases. This isn’t a company stretched to meet its dividend commitments. It’s one that’s planning for the long term.
Dividends are paid quarterly, and the next one is expected in June. The last payment was made in March, right on schedule. While Griffon doesn’t have a decades-long history of dividend hikes like some larger names, it has been consistent since it brought the dividend back—and that consistency has value.
Dividend Growth and Safety
Here’s where Griffon starts to look more interesting. Even though the yield is modest, there’s been real movement on the growth side. The company recently increased its annual payout from $0.63 to $0.72 per share. That’s a 14% raise, and it wasn’t just symbolic. It came on the back of improved earnings and solid cash generation.
The safety of the dividend looks very strong. A payout ratio below 13% and over $315 million in free cash flow means Griffon could easily cover its dividend more than five times over. That’s not just safe—it’s conservative.
Cash Flow Statement
Griffon’s cash flow story over the trailing twelve months paints a picture of a company with a strong operational backbone. Operating cash flow came in at $376.9 million, essentially holding steady from the prior year, which underscores the consistency in its core business. Even after accounting for $71.5 million in capital expenditures, free cash flow landed at a healthy $305.4 million. That’s more than enough to cover dividend obligations and support continued debt reduction or share repurchases.
On the financing side, Griffon was aggressive in returning capital to shareholders, with $277.6 million spent on stock buybacks. While the company issued $185.5 million in new debt, it also paid down $154.9 million, showing a net effort to manage its leverage strategically. Investing activities were relatively modest at a cash outflow of $51.7 million, primarily reflecting standard reinvestment. The end cash position rose to $152.8 million, up from $114.4 million a year earlier, signaling healthy liquidity even as the company actively manages capital across multiple fronts.
Analyst Ratings
Griffon Corporation (GFF) has recently garnered positive attention from analysts, with several updates reflecting a favorable outlook. 🟢 The consensus among analysts is a “Strong Buy,” supported by consistent performance and strategic initiatives.
📈 The average 12-month price target for GFF stands at $91.33, suggesting a potential upside of approximately 28% from its current trading price. The highest price target is set at $95.00, while the lowest is $88.00. These targets suggest confidence in Griffon’s ability to maintain and grow its earnings base.
💼 Recent earnings reports have played a significant role in shaping analyst sentiment. Griffon’s adjusted earnings per share for the second quarter were $1.23, which beat expectations of $1.09. Even though revenue declined by 9% year-over-year, analysts were encouraged by the company’s strong margins and disciplined cost control. It’s a sign that management is steering the business efficiently even in softer topline environments.
🏠 Analysts have also noted Griffon’s strategic focus on its Home and Building Products segment, which continues to deliver strong EBITDA margins, hovering around 30%. Meanwhile, the Consumer and Professional Products segment benefits from an asset-light model, which supports stable cash generation and scalability.
🔍 In short, strong execution, improved profitability, and targeted business strategy have driven recent analyst upgrades and price target increases. The tone is clearly optimistic, and Griffon’s fundamentals seem to be lining up well with that narrative.
Earning Report Summary
A Mixed Quarter with Strong Bottom-Line Execution
Griffon Corporation’s second-quarter results for fiscal 2025 tell a story of a company navigating a softer demand environment while still keeping its margins healthy. Total revenue came in at $611.7 million, down about 9% compared to the same time last year. Even with the top line taking a hit, earnings per share on an adjusted basis landed at $1.23, comfortably ahead of where most expected them to be. Net income was $56.8 million, or $1.21 per share, a slight dip from $64.1 million last year, but still a solid showing.
What really stood out was how well Griffon managed to hold onto profitability, even as sales volumes came under pressure. That kind of consistency points to solid execution at the operational level.
Segment Performance Highlights
The Home and Building Products (HBP) segment brought in $368.2 million in revenue, which was down 6% year-over-year. That softness was mainly due to a 7% decline in volume, though a stronger mix of products helped cushion the blow a bit. Even with those headwinds, the segment turned in an adjusted EBITDA of $109.4 million, which is still a strong number, though it was down from last year’s $128.9 million. Higher labor and distribution costs added some weight to the margins, but the fundamentals are holding up.
Over in Consumer and Professional Products (CPP), the revenue decline was a bit steeper—down 13% to $243.5 million. The main factors there were slower demand in North America and the UK. But despite the drop in revenue, the CPP team delivered an 18% increase in adjusted EBITDA, up to $23.7 million. That’s thanks in large part to a leaner, more asset-light model and better sourcing. Australia, in particular, continues to be a bright spot.
Leadership’s Take and the Road Ahead
CEO Ron Kramer sounded pretty upbeat during the quarter’s commentary. He noted that both segments performed in line with expectations and seemed particularly pleased with the 30% EBITDA margin in the HBP segment. For CPP, he pointed to the positive results from Australia and the team’s progress on trimming down the operating structure.
Griffon isn’t changing its full-year outlook. They’re still calling for around $2.6 billion in total revenue, which suggests some confidence that current headwinds are manageable. Free cash flow came in at $145.8 million for the first half of the year, which helped support $30.5 million in share repurchases during the quarter. The company also kept its dividend steady, declaring a payout of $0.18 per share for June.
As for the rest of the year, leadership hinted at more work to come on managing costs and pricing, especially as market conditions remain a bit fluid. The tone was steady—not overly cautious, but clearly focused on staying agile.
Management Team
Griffon Corporation’s leadership is guided by a seasoned executive team with deep experience in industrial operations, financial stewardship, and long-term strategic planning. Ronald J. Kramer leads as Chairman and CEO, roles he has held since 2018 and 2008 respectively. His background in investment and executive leadership has shaped Griffon’s evolution into a more streamlined, shareholder-focused company. Kramer is known for his disciplined approach to capital allocation and his steady hand during market shifts.
Robert F. Mehmel serves as President and Chief Operating Officer, playing a key role in Griffon’s operational execution. His leadership is particularly evident in the day-to-day performance of the company’s two main segments. Brian G. Harris, Executive Vice President and Chief Financial Officer, brings a strong financial acumen, overseeing everything from debt management to capital returns with a clear focus on maintaining fiscal discipline.
The broader leadership group includes legal, operational, and segment-specific heads who contribute to Griffon’s stability and execution. With a structure that balances operational detail with strategic oversight, the management team has successfully navigated economic cycles, maintained profitability, and directed resources to support both organic growth and disciplined acquisitions.
Valuation and Stock Performance
Griffon’s stock performance over the past year reflects a solid rebound and continued investor confidence. Trading in the upper $60s to low $70s range, the stock has moved meaningfully off its 52-week low of $55, though it remains below its peak near $87. The share price has been shaped by strong earnings execution and steady cash generation, even amid revenue softness.
From a valuation perspective, the trailing P/E ratio of around 13.9 places Griffon in a modestly priced category relative to its earnings, especially when considering the company’s improved margins and solid free cash flow profile. The enterprise value to EBITDA ratio, hovering below 10, also reflects a fairly valued industrial operator with room for further multiple expansion if earnings continue to grow.
Analyst sentiment has turned increasingly positive, with price targets ranging from $88 to $95, suggesting potential upside from current levels. The market appears to be recognizing Griffon’s operational improvements, efficient cost structure, and its shift toward higher-margin segments.
The company’s dividend yield, while modest at just over 1%, is supported by a very low payout ratio. That gives it room to grow over time without straining financial resources. Coupled with an active buyback program and continued debt reduction, the company is giving investors a well-rounded total return profile.
Risks and Considerations
No company is without risks, and Griffon is no exception. The most immediate is exposure to cyclical industries. Demand for its products, particularly in the Home and Building Products segment, is closely tied to housing activity and general economic conditions. A prolonged slowdown in residential construction or remodeling could weigh on future results.
The Consumer and Professional Products segment, while becoming more efficient, is still subject to fluctuations in retail demand. As consumers adjust spending habits in a changing economic environment, this part of the business could face near-term volatility.
Debt is another area to monitor. While Griffon is actively paying it down and remains well within coverage ratios, its overall leverage remains high. Continued focus on reducing that balance will be important for preserving flexibility in a rising rate environment.
On the operational side, supply chain and input cost variability can put pressure on margins. Labor costs, distribution, and raw material pricing need to be managed closely, especially as some cost pressures may prove more stubborn than initially expected.
Lastly, competitive dynamics in both segments are intense. Griffon must continue to differentiate itself through innovation, customer service, and execution to defend and grow market share.
Final Thoughts
Griffon Corporation has spent the last several years sharpening its focus, tightening its operations, and becoming a more efficient, shareholder-minded company. That effort is starting to pay off in the form of stronger earnings, better margins, and steady free cash flow. Leadership has proven they can operate effectively in both good and challenging environments, and the balance sheet, while leveraged, is trending in the right direction.
The stock offers a combination of operational strength and capital return, and while it may not be a headline grabber, it’s clearly being managed with purpose. For those watching from the sidelines, Griffon is becoming a story of quiet execution and evolving value, with a management team focused on staying the course and unlocking more upside over time.