About TopBuild Corp
TopBuild Corp., together with its subsidiaries, engages in the installation and distribution of insulation and other building products to the construction industry. The company operates in two segments, Installation and Specialty Distribution. It provides insulation products and accessories, glass and windows, rain gutters, afterpaint products, fireproofing products, garage doors, fireplaces, closet shelving, roofing materials, and other products; and insulation installation services. The company also offers various services and tools to assist builders in applying the principles of building science to new home construction, which include pre-construction plan reviews, diagnostic testing, and various inspection services; and home energy rating services. In addition, it distributes building and mechanical insulation, insulation accessories, and other building product materials for the residential, commercial, and industrial end markets. The company serves single-family homebuilders, single-family custom builders, multi-family builders, commercial general contractors, remodelers, and individual homeowners, as well as insulation contractors, gutter contractors, weatherization contractors, other contractors, dealers, metal building erectors, and modular home builders.
It operates approximately 235 installation branches and 175 distribution centers in the United States and Canada. The company was formerly known as Masco SpinCo Corp. and changed its name to TopBuild Corp. in March 2015. TopBuild Corp. was incorporated in 2015 and is headquartered in Daytona Beach, Florida.
BLD operates in the Construction | headquartered in Daytona Beach, Florida | approximately 13,100 employees | led by CEO Robert M. Buck.
The $11.0B question: What happens when a company this good becomes this expensive?
In the constellation of American capitalism, certain companies shine brighter than others — not because they are inherently more valuable, but because they have positioned themselves at the nexus of forces that shape the economy. TopBuild Corp is one such company.
At $11.0B in market capitalization, TopBuild Corp (BLD) currently ranks #217 in our quantitative model, with a composite score of 76.2/100. That places it firmly in "Strong Buy" territory — our highest conviction rating.
But here's the thing about stocks priced for perfection: They leave no room for error.
The Numbers That Matter
Let's start with what's undeniably true. Our 6-factor model gives BLD the following scores:
| Factor | Score | Weight | Assessment |
|---|---|---|---|
| Quality | 74/100 | 30% | Strong |
| Value | 58/100 | 15% | Premium |
| Momentum | 70/100 | 25% | Accelerating |
| Investment | 98/100 | 10% | Growing |
| Stability | 49/100 | 10% | Volatile |
| Short Interest | 42/100 | 10% | Normal |
The quality score of 74/100 is the headline here. It reflects profitability metrics that would make most CFOs weep with envy:
- ROE: 27.0%
- Net Margin: 10.2%
- Gross Margin: 30.1%
These aren't just good numbers. They're the kind of numbers that make BLD a "must-own" stock for institutional portfolios.
The Bull Case
"If you could design a business in a laboratory, it would look something like BLD."
The bull case writes itself:
- Quality is persistent. Academic research shows high-quality stocks outperform by 4-6% annually over long periods. BLD is quality defined.
- Momentum is real. With a momentum score of 70/100, the stock has been recognized by the market — and momentum tends to persist.
- The moat is deep. Companies with these margins don't lose them easily. The competitive position is entrenched.
The Bear Case
But here's what keeps value investors up at night:
- Valuation compression risk. At current levels, the stock is priced for continued perfection. Any stumble — a missed quarter, a competitive threat, a macro slowdown — could compress the multiple from 19.4x to the low 20s. That's a 20-30% decline without anything fundamentally "wrong."
- The crowded trade problem. When everyone owns a stock, who's left to buy? Momentum works until it doesn't.
- Mean reversion. Trees don't grow to the sky. At some point, growth decelerates.
The Valuation Framework
| Scenario | Assumption | Fair Value | Upside/Downside |
|---|---|---|---|
| Bear | Multiple compression to 20x | -20% | Downside |
| Base | Current trajectory continues | +10-15% | Modest upside |
| Bull | Momentum accelerates | +30-40% | Significant upside |
The risk-reward is ... fine. Not exceptional. Not terrible. Just fine.
The Bottom Line
TopBuild Corp is exactly what it appears to be: a high-quality business with strong momentum trading at a premium price. Whether that's attractive depends entirely on what kind of investor you are.
For long-term, buy-and-hold investors, BLD is a core holding. For value investors or short-term traders, look elsewhere.
The company is priced for perfection — and in markets, as in life, perfection is a fragile thing.
⭐⭐⭐⭐⭐ Rating: 5-Star Strong Buy
Score: 76.2/100 | Rank: #217 of 3,571 stocks
Sector: Industrials
This analysis reflects the views of Blank Capital Research as of February 16, 2026. It is not investment advice. Past performance does not guarantee future results.