Shares of James Hardie Industries PLC (JHX) plummeted 6.72% in pre-market trading on Wednesday, following the release of the company's fourth-quarter results and disappointing fiscal year 2026 outlook. The building materials supplier's cautious forecast, particularly for its crucial North American market, has sparked investor concerns about future growth prospects.

In its latest earnings report, James Hardie revealed that its Q4 adjusted earnings per share came in at $0.36, meeting analyst expectations. However, the company's revenue of $971.50 million fell short of the anticipated $994.80 million. More worryingly, management's updated FY2026 outlook caught investors off guard, projecting market volume contractions in North America, including a fourth consecutive year of declines in large-ticket repair and remodel activity. This outlook is particularly significant as North America represents approximately three-quarters of James Hardie's net sales.

Adding to investor concerns, the company's net debt was approximately $80 million higher than consensus expectations, according to Barrenjoey analyst Brook Campbell-Crawford. This increased debt level is particularly noteworthy as James Hardie prepares to acquire U.S. rival AZEK in a cash-and-stock deal worth $8.75 billion. In response to the earnings report and outlook, Truist Securities adjusted its price target on James Hardie to $35 from $45, while maintaining a Buy rating on the shares. Despite the current challenges, analysts polled by FactSet maintain an average rating of overweight for JHX, with a mean price target of $30.19.