Mannington Mills Inc.

However, our assessment of Mannington's business is constrained by its sole focus on flooring products, which leads us to view it as having relatively limited product diversity. The company is relatively small given that it reported 2020 revenue compares with over $9 billion at its competitor Mohawk. In addition, we view Mannington as having weaker profitability and market strength than the larger players in its industry. The company derives about 49% of its revenue from the U.S. residential market, 36% from the U.S. commercial market, and roughly 15% from the rest of world. We assume Mannington will modestly increase its sales in the next 12 months as the steady pace of remodeling activity and the strong conditions in the residential

...Key strengths Key risks Leading market position in the growing luxury vinyl tile (LVT) line with an expanding sales and distribution network. A continued slowdown in commercial activity and overcapacity in the flooring industry could hinder its future expansion. Provides flooring solutions to both the commercial and residential end markets in the U.S., Canada, U.K., and Europe. Given its limited pricing power, raw material and general cost inflation could pressure its operating margins. Vertically integrated manufacturer of carpeting, LVT, and other stock-keeping units (SKUs). Relatively small, with slightly less than $1 billion of annual revenue, and limited product diversity given its sole focus on flooring products. Elevated leverage of 5.9x as of year-end 2020....

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