Beacon Roofing Supply, Inc. (NASDAQ: BECN) stock fell over 1.1% today (as of 9 Oct, 9:55 AM GMT-4; Source: Google finance). The stock has been a weak performer this week, falling over 47.5% in this year to date (Source: Google finance) though the company’s stock was downgraded by William Blair from Outperform to Market Perform with a price target of $33.00. The current consensus rating on BECN is Hold with a consensus target price of $48.8571 per share, a potential 46.54% upside.

For the third quarter of 2018, BECN has reported 59.4% increase in the total sales to a third quarter record of $1.93 billion, up from $1.21 billion in 2017. Residential roofing product sales increased 23.4%, non-residential roofing product sales increased 42.1% and complementary product sales increased 204.6% over the prior year. Existing markets sales, excluding acquisitions, increased 2.0% for the quarter. The third quarter of fiscal years 2018 and 2017 each had 64 business days. Organic sales increased 2.0%, reflecting improved pricing, partially offset by volume headwinds from difficult storm comparisons within the larger traditional hail markets.Gross margins expanded by 100 bps compared to the prior year quarter and 180 bps compared to the second quarter of fiscal year 2018.

Net income attributable to common shareholders for the third quarter was $43.4 million, compared to $44.7 million in 2017. Third quarter EPS was $0.55, compared to $0.73 in 2017. Adjusted Net Income (Loss), after removing the impact of acquisition related costs and the non-recurring effects of tax reform, was $93.4 million in the third quarter of 2018, compared to $59.3 million in 2017. Third quarter Adjusted EPS was $1.18, compared to $0.97 in 2017. Third quarter results were positively impacted by solid organic sales growth within non-residential roofing and complementary building products categories, improved existing markets gross margins and favorable contributions from acquired operations. Third quarter results were negatively impacted by a decline in residential roofing volumes and higher operating expenses, increased interest expense and the impact from preferred dividends primarily related to the acquisition of Allied.

Meanwhile, BECN has acquired Atlas Supply, Inc., the Pacific Northwest’s leading distributor of sealants, coatings, adhesives and related waterproofing products. Atlas is  considered a tremendous addition to Beacon and significantly strengthens the sealant, coatings and waterproofing business in the robust Pacific Northwest market. The Atlas acquisition enables Beacon to serve customers along the entire west coast and a portion of the Southwest and enhances the strategy to grow the strong margin complementary products business.