H.B. Fuller

Bull case

• H.B. Fuller is showing an increasing trend in profitability, with adjusted EBITDA margins rising to 19.9%, due in part to favorable pricing, raw material management, and the benefits of restructuring and synergistic acquisitions. There is also an expected growth in FY24 net revenue by 3%
• 6%, and an adjusted EBITDA forecasted to be in the range of $610 - $640 million – indications of the company's strong financial performance. Additionally, strong growth in the ePower category, along with an expectation of an Adjusted EPS growth rate of 7%
• 15% YOY for FY24, demonstrate H.B. Fuller's potential for higher earnings and its robust business model's ability to drive through-cycle growth.

Bear case

H.B. Fuller is facing significant challenges, headlined by consistent decreases in company-wide sales and volume. On the breakdown by segment, both Engineering Adhesives and Hygiene, Health & Consumables recorded declines in sales and volume with respective drops of 7.4% and 7.3%. Key issues consist of lower demand in key markets especially in construction and solar, reduction in prices on both segments, and adverse effects from increased prices in raw materials as well as financial headwinds from high interest expenses impinging on earnings.