LEG Should I Buy
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Leggett & Platt Inc (LEG) is a good buy for a beginner investor with a long-term strategy and $50,000-$100,000 available for investment. The company's restructuring efforts, improved profitability, and potential acquisition by Somnigroup provide strong positive catalysts. Despite some short-term technical weakness, the long-term prospects and valuation make it an attractive investment.
The MACD histogram is negative and expanding, indicating bearish momentum. RSI is neutral at 25.045, not signaling overbought or oversold conditions. Moving averages are bullish (SMA_5 > SMA_20 > SMA_200), suggesting an upward trend. Support is at 11.487, with resistance at 12.881. The stock is trading near support levels, which could present a buying opportunity.
Towle & Co initiated a significant new position in LEG, indicating institutional confidence.
The company has completed its restructuring plan, expected to yield $70 million in EBIT benefits.
Q4 profit increased significantly to $25.2 million, up from $14.2 million last year.
Potential acquisition by Somnigroup could be highly accretive and beneficial for shareholders.
Revenue declined 10.6% YoY in Q4
The stock has a 70% chance of declining by 11.11% in the next month based on historical patterns.
In Q3 2025, revenue dropped by 5.93% YoY to $1.036 billion. However, net income surged by 183.07% YoY to $127.1 million, and EPS increased by 175.76% YoY to 0.91. Gross margin improved to 18.47%, up 4.82% YoY. In Q4 2025, profit rose to $25.2 million despite an 11% YoY revenue decline, reflecting strong cost management and restructuring benefits.
Piper Sandler raised the price target from $10 to $12 and maintained a Neutral rating, citing the potential acquisition by Somnigroup as highly compelling. BNP Paribas Exane upgraded LEG Immobilien to Outperform, highlighting attractive valuations.
