Technical Analysis on USG and Masco: Building Material Stocks Begin to Look Up

Feb 06, 2013, 07:30 ET from

LONDON, February 6, 2013 /PRNewswire/ --

The housing sector is finally looking up and the stocks are currently enjoying an upward ride. While major builders are going to be the biggest beneficiaries of the upturn, material supplying stocks like USG Corporation (NYSE: USG) have also started showing signs of changing macro environment and have set new high stock prices. However, the scenario is not all that rosy. The housing sector, despite showing improvement, is likely to take a long time to get back to its full potential and in the meantime, major companies like Masco Corporation (NYSE: MAS) are undertaking steps to contain their costs and enhance margins. StockCall professionals have initiated technical research on USG Corp. and Masco Corp., and these free reports are available by registering now at

USG Corporation Hits 52-Week High

USG Corporation stock hit a 52-week high recently and is on an upward trajectory. The company is set to benefit from recent uptick in the housing sector. USG deals in roofing, flooring and wall products and is a market leader in wallboard segment. The company is set to announce its fourth quarter financial number today and it is likely to report a 4.8 percent growth in the revenue to $786.1 million. However, its EPS is expected to remain in negative territory at -$0.27. The company had been incurring losses since 2007, but the quantum has declined over the years. For today's free research report on USG (pre-earnings), sign up at

USG Corporation is better placed to ride out housing sector recovery as it is not tied to any particular segment. In this regard, the stock is less speculative than the homebuilding stocks. The housing sector seems to be recovering but it is likely to take some time to get back to its old peak. Similar pattern is likely to be shown by the allied stocks and thus there is good upside to these stocks. USG Corporation stock has grown about 6 percent this year so far, and it is favored by Warren Buffett, who holds a 16 percent interest in the company. USG Corporation offers good investment venue as it benefits from improved economy and resulting surge in construction and remodeling activities.

Masco to Cut Costs

Masco Corporation deals in home improvement and building material and it hit a new 52-week high recently as well. The company is operational in the United States and Europe but it draws most of its revenue from the U.S. The stock was recently upgraded from Neutral to Outperform by Credit Suisse, which now expects the stock to touch $22 in the near future. Masco Corporation stock has grown more than 40 percent in past 12 months and offers modest dividend yield of 1.63 percent, making this stock an attractive investment option. Register now to get the complete report on Masco free of charge at

Masco Corporation is also planning to restructure its business in a big way. It has plant closures and business consolidation on cards. The company may also reduce its workforce and optimize its supply chain to reduce overheads. Masco Corporation had the target of reducing its gross costs by $175 million in 2012. These steps are expected to have long term impact on the stock price. Coupled with improving economic scenario, these positive changes may enhance the profitability of the firm.

Masco will be reporting its financial results on February 11th, 2013.

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