Value
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.5 |
| P/S | 9.5 |
| EV/EBITDA | 5.9 |
| Fwd P/E | 8.9 |
| PEG | 4.8 |
| Analyst target | 3.0 |
- ▸Forward P/E: 12.2x
- ▸PEG: 1.68
FBIN · Why this verdict
Why Fortune Brands Innovations (FBIN) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.5/10
ConfidenceHIGH
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Fortune Brands Innovations is trading at a level where upside to the analyst price target has been largely exhausted, while two recent earnings misses and a confirmed downtrend in price argue for caution; the risk/reward does not support adding exposure at current prices.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The company has missed earnings estimates in two of the three most recent quarters — including a 13.7% shortfall in the second-most-recent period — with the oldest quarter in the trailing four delivering the only beat; this pattern of under-delivery raises doubt about management's ability to guide and execute consistently in the current operating environment. Earnings | Over the next 12 months, EPS results begin to beat consensus estimates by a positive margin for at least two consecutive quarters, signaling a return to reliable execution. | →Stable |
| CounterDeclining revenue of approximately negative 2% may reflect a cyclical trough rather than structural deterioration, and the single recent beat suggests earnings power has not fully evaporated; a housing or building products recovery could restore both top-line growth and earnings delivery. | ||
The stock is trading below its 200-day moving average, which carries a negative slope of roughly 5% per month, meeting the technical definition of a confirmed downtrend; an overbought reading in this context suggests the current bounce may be a bear-market rally rather than a sustainable reversal. Momentum breakdown | Over the next 12 months, the stock reclaims and holds above the 200-day moving average with the slope turning flat or positive, confirming a genuine trend change. | →Stable |
| CounterThe MACD has been improving and on-balance volume is rising, which can precede a genuine trend reversal even while the stock remains below the 200-day average; momentum indicators diverging positively from price is an early signal that selling pressure is exhausting. | ||
With the stock just below the resistance price target and only 2.6% of potential upside remaining against approximately 7% of downside exposure, the risk/reward of 0.37-to-1 is well below any reasonable threshold for new entry; the setup does not reward buyers at current levels. Price targets | Over the next 12 months, a meaningful pullback creates at least 10% headroom to the take-profit target, restoring an acceptable entry geometry. | →Stable |
| CounterA stock near its analyst price target has already reflected positive price discovery; if fundamentals stabilize and revenue trends reverse, analyst targets may be revised upward, widening the potential upside from the current price. | ||
Options traders are positioning defensively, with a put/call ratio of 2.23 and implied volatility at 96%, signaling that the market is pricing in a high probability of further downside; this level of hedging activity is unusual and warrants caution for anyone considering new exposure. Risk breakdown | Over the next 12 months, the put/call ratio falls below 1.0 and implied volatility normalizes toward the sector average as the stock stabilizes. | →Stable |
| CounterElevated put/call ratios can also reflect hedging by existing long holders rather than outright bearish speculation, and very high implied volatility may compress quickly once near-term uncertainty resolves, potentially producing a tailwind for the stock. | ||
The company has missed earnings estimates in two of the three most recent quarters — including a 13.7% shortfall in the second-most-recent period — with the oldest quarter in the trailing four delivering the only beat; this pattern of under-delivery raises doubt about management's ability to guide and execute consistently in the current operating environment.
→StableEarnings
- Expectation
- Over the next 12 months, EPS results begin to beat consensus estimates by a positive margin for at least two consecutive quarters, signaling a return to reliable execution.
CounterDeclining revenue of approximately negative 2% may reflect a cyclical trough rather than structural deterioration, and the single recent beat suggests earnings power has not fully evaporated; a housing or building products recovery could restore both top-line growth and earnings delivery.
The stock is trading below its 200-day moving average, which carries a negative slope of roughly 5% per month, meeting the technical definition of a confirmed downtrend; an overbought reading in this context suggests the current bounce may be a bear-market rally rather than a sustainable reversal.
→StableMomentum breakdown
- Expectation
- Over the next 12 months, the stock reclaims and holds above the 200-day moving average with the slope turning flat or positive, confirming a genuine trend change.
CounterThe MACD has been improving and on-balance volume is rising, which can precede a genuine trend reversal even while the stock remains below the 200-day average; momentum indicators diverging positively from price is an early signal that selling pressure is exhausting.
With the stock just below the resistance price target and only 2.6% of potential upside remaining against approximately 7% of downside exposure, the risk/reward of 0.37-to-1 is well below any reasonable threshold for new entry; the setup does not reward buyers at current levels.
→StablePrice targets
- Expectation
- Over the next 12 months, a meaningful pullback creates at least 10% headroom to the take-profit target, restoring an acceptable entry geometry.
CounterA stock near its analyst price target has already reflected positive price discovery; if fundamentals stabilize and revenue trends reverse, analyst targets may be revised upward, widening the potential upside from the current price.
Options traders are positioning defensively, with a put/call ratio of 2.23 and implied volatility at 96%, signaling that the market is pricing in a high probability of further downside; this level of hedging activity is unusual and warrants caution for anyone considering new exposure.
→StableRisk breakdown
- Expectation
- Over the next 12 months, the put/call ratio falls below 1.0 and implied volatility normalizes toward the sector average as the stock stabilizes.
CounterElevated put/call ratios can also reflect hedging by existing long holders rather than outright bearish speculation, and very high implied volatility may compress quickly once near-term uncertainty resolves, potentially producing a tailwind for the stock.
Per-dimension breakdown
Quality
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 3.9 |
| ROA | 4.0 |
| Gross margin | 5.0 |
| Op margin | 2.6 |
| Net margin | 3.1 |
| Current ratio | 7.4 |
| FCF quality | 8.0 |
| Moat | 3.9 |
| Piotroski F | 6.7 |
- ▸No competitive moat
Growth
1.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.0 |
| EPS growth | 0.0 |
- ▸Declining revenue: -2%
Momentum
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.1 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -5.2%/30d — confirmed downtrend
Sentiment
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 5.4 |
| erm sentiment | 5.2 |
Insider
7.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 9.0 |
| insider conviction | 8.0 |
| holder change | 5.1 |
- ▸Heavy insider buying — $28,653,958 (0.538% of mkt cap)
Peer rank
3.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.4 |
| quality rank | 3.5 |
| growth rank | 2.1 |
- ▸Attractive P/E vs peers
Technical
1.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.2 |
| 52w position | 4.3 |
Risk (lower is worse)
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 4.6 |
| days to cover | 7.0 |
| volatility | 1.0 |
| put call | 5.9 |
| implied vol | 3.6 |
| max pain risk | 3.0 |
| beta | 5.2 |
| debt equity | 4.5 |
- ▸Above max pain $25
Catalyst
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 1.1 |
| earnings timing | 5.0 |
| surprise avg | 0.9 |
| dividend safety | 6.5 |
- ▸Earnings concerns: 1B/2M
- ▸Dividend: 233.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:5.8>=5.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:35d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:-0.7=NEGATIVE
- INSIDER:0.54%=HEAVY
Warning (1)
- DEATH_CROSS:momentum=5.8>=5.0 recovering
Reward-to-Risk
-0.71
Upside
-10.6%
Downside
15.0%
Sizing output
AVOID
SetupRECOVERY — Death cross but MACD improving, RSI 69
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — Beta 1.45>1.3
Investment implication
The F-path SELL output reflects an overall score of 4.0 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Insider at 7.4) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.7=NEGATIVE, INSIDER:0.54%=HEAVY) reinforce the read. Current asymmetry R:R is -0.71 — supplementary context, not the trigger for this path.
The strongest dimensions are Insider at 7.4, Value at 6.3, and Momentum at 5.8; the weakest are Growth at 1.0, Technical at 1.5, and Peer rank at 3.5. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.71 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The company has missed earnings estimates in two of the three most recent quarters — including a 13.7% shortfall in the second-most-recent period — with the oldest quarter in the trailing four delivering the only beat; this pattern of under-delivery raises doubt about management's ability to guide and execute consistently in the current operating environment.
Trip ifEPS surprise exceeds 3% for 2 consecutive quarters.
- P2The stock is trading below its 200-day moving average, which carries a negative slope of roughly 5% per month, meeting the technical definition of a confirmed downtrend; an overbought reading in this context suggests the current bounce may be a bear-market rally rather than a sustainable reversal.
Trip ifStock closes and holds above the 200-day moving average for 3 consecutive weeks.
- P3With the stock just below the resistance price target and only 2.6% of potential upside remaining against approximately 7% of downside exposure, the risk/reward of 0.37-to-1 is well below any reasonable threshold for new entry; the setup does not reward buyers at current levels.
Trip ifUpside to the resistance target exceeds 10% from current price.
- P4Options traders are positioning defensively, with a put/call ratio of 2.23 and implied volatility at 96%, signaling that the market is pricing in a high probability of further downside; this level of hedging activity is unusual and warrants caution for anyone considering new exposure.
Trip ifPut/call ratio falls below 1.0.