JELD

Despite 75% Stock Collapse, Turtle Creek Keeps Buying JELD-WEN($JELD) Shares: $1.5M Added Amid Q1 Earnings Shock

05/09/2025 00:41

Major shareholder Turtle Creek Asset Management continued its aggressive buying spree of JELD-WEN Holding Inc ($JELD) shares, purchasing 150,000 shares at an average price of $4.26, totaling $639,030 on May 6th, 2025. Notably, this substantial purchase occurred on the same day JELD-WEN's stock plummeted 21.8% following its disappointing Q1 earnings announcement. The window and door manufacturer reported a 19.1% year-over-year revenue decline to $776 million for Q1 2025, with an adjusted loss of $0.17 per share. While this slightly exceeded analyst expectations of a $0.19 loss, the company's weak guidance and management's commentary about deteriorating market conditions disappointed investors. The CEO highlighted ongoing market challenges despite cost-cutting efforts and noted limited visibility moving forward, though he anticipated some EBITDA improvement in Q2. Despite these headwinds, insiders—particularly Turtle Creek Asset Management—have demonstrated remarkable confidence in JELD-WEN stock over the past six months. SEC filings reveal that Turtle Creek has consistently purchased JELD-WEN shares almost every month from November 2024 through May 2025, accumulating over 2 million shares worth approximately $15 million. A notable pattern emerges: Turtle Creek's purchases often increase in size following significant stock price declines. Turtle Creek Asset Management, a Toronto-based investment firm known for its long-term value investing approach, typically targets fundamentally strong but temporarily undervalued companies. Their persistent buying suggests a belief that JELD-WEN's current challenges are transitory and that the company has recovery potential over the long term. Turtle Creek isn't the only insider showing confidence in JELD-WEN. On March 5th, 2025, EVP Matthew Meier purchased 20,000 shares at $5.73 per share, representing an investment of $114,600. Additionally, Director David G. Nord acquired 20,000 shares at $5.96 per share on February 24th, and Director Steven E. Wynne bought 10,000 shares at $6.01 per share on February 27th. This cluster buying pattern among multiple insiders is often interpreted as a potential bottoming signal for the stock. However, JELD-WEN's financial situation presents significant concerns. The company reported a net loss of $179.8 million in its most recent quarter, substantially wider than the $27.7 million loss in the same period last year. Additionally, its debt-to-equity ratio stands at a concerning 189.3%, indicating potential financial risk. In the broader industry context, the general weakness in construction and housing markets continues to create a challenging environment for building product companies like JELD-WEN. Reduced housing demand and construction activity due to higher interest rates directly impact the company's sales. Nevertheless, the company's recent amendment to its revolving credit agreement, disclosed on March 26th, 2025, may help secure short-term liquidity. JELD-WEN's stock has fallen approximately 75% from its mid-July 2024 high of over $16 to around $4 currently. Particularly sharp declines of 28.6%, 20%, and 21.8% occurred immediately following earnings announcements on November 5th, 2024, February 18th, 2025, and May 6th, 2025, respectively. The consistent insider buying despite these declines is noteworthy. Analysts maintain a cautious stance on JELD-WEN. According to recent data, 8 analysts rate the stock as 'hold', 1 as 'sell', and 1 as 'strong sell', with a median price target of $6.00, suggesting modest upside potential from current levels. The persistent buying activity from insiders, especially Turtle Creek Asset Management, indicates their conviction that JELD-WEN's stock is trading below its fundamental value. However, investors should consider the company's high debt levels, continuing market deterioration, and performance struggles in recent quarters. It will be important to monitor whether the company's cost-cutting efforts translate into improved profitability and if housing market conditions begin to stabilize in the coming months.

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