Apogee Enterprises, Inc. APOG announced that it inked a definitive agreement with the Keller family to acquire Kalwall Companies. This deal is expected to solidify APOG’s Architectural Glass segment.
Apogee Boosts Portfolio With Kalwall Deal
The purchase price is set at $115 million, including $105 million cash at closing and the remaining $10-million performance-based earnout through the third quarter of fiscal 2027. Apogee expects the transaction to close in the second quarter of fiscal 2027, subject to closing conditions.
Headquartered in the United States, Kalwall is a manufacturer of high-performance translucent daylighting solutions that serve a broad range of customers. The addition of Kalwall will expand APOG’s portfolio of differentiated solutions and boost its position in high-performance building envelope solutions.
Apogee expects this deal to yield $4 million of operational cost synergies by the end of fiscal 2029. Moreover, Kalwall is expected to generate $85 million in revenues within the first 12 months of the deal completion. The company expects an adjusted EBITDA margin of 15%, with a long-term margin target of 20%. The deal is also expected to be accretive to the company’s adjusted earnings in the first year of completion.
Kalwall will become part of Apogee’s Architectural Glass segment post the integration.
APOG’s Performance in Q4
Revenues in the Architectural Glass segment decreased 10.4% year over year to $67.4 million due to lower volume and price. The segment’s adjusted EBITDA declined to $9.1 million from $14.1 million in the year-ago quarter.
Overall, Apogee posted adjusted earnings of 92 cents per share for the fourth quarter of fiscal 2026, up 3.4% year over year. The results topped the Zacks Consensus Estimate of 89 cents, delivering a 3.37% positive surprise.
Quarterly revenues came in at $351 million, rising 1.6% from the year-ago period and beating the consensus mark of $337 million by 4.38%. Architectural Services ended the quarter with a backlog of $693.8 million, a key indicator of near-term project activity in Apogee’s installation business.
Apogee’s Stock Price Performance
Shares of the company have lost 0.1% in the past year compared with the industry's decline of 22.2%.
APOG’s Zacks Rank & Stocks to Consider
Apogee currently carries a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks from the Industrial Products sector are Tennant Company TNC, Nordson Corporation NDSN and RBC Bearings Incorporated RBC. These three companies have a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Tennant has an average trailing four-quarter earnings surprise of 40.8%. The Zacks Consensus Estimate for TNC’s 2026 earnings is pinned at $5.15 per share. The company’s shares have gained 19.4% in a year.
The Zacks Consensus Estimate for Nordson’s fiscal 2026 earnings is pegged at $11.54 per share. The company has a trailing four-quarter average earnings surprise of 2.3%. Nordson’s shares have gained 39% in a year.
The Zacks Consensus Estimate for RBC Bearings’ fiscal 2027 earnings is pegged at $14.17 per share. The company has a trailing four-quarter average earnings surprise of 6.2%. RBC shares have gained 58.2% in a year.
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This article originally published on Zacks Investment Research (zacks.com).