CARLISLE COMPANIES INCORPORATED (CSL): what the price requires

At today's price, CARLISLE COMPANIES INCORPORATED (CSL) is priced for +7.7% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-19 · Source: https://boothcheck.com/report/CSL

Headline

FieldValue
TickerCSL
CompanyCARLISLE COMPANIES INCORPORATED
Current price$332.41/sh
CompositionNon-residential construction 80% / Residential construction 17% / Other 3%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Operating margin needed13.8%
Operating margin today20.1%
Margin compression implied-6.3pp
Implied growth7.7%
Multiple paid16x operating income

The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.

Solve inputs: computed at a 9% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~6.3pp.

How unusual the bet is: within-range

ReferenceValue
vs own history-0.18σ
cohort percentile (of 212 peers)39
implied end-window share0%

Valuation X-Ray

The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.74x5expensive
Earnings1.77x4expensive
Relative1.10x3expensive
Growth1.04x3expensive

Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.8%); the inversion above states its own rate.

Per-Model Detail (n=15)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$318.221.04xyesFCF base $0.9B, growth -1% (input: historical growth), terminal g 0.5%, WACC 7.8%, 5yr projection
DCF Exit MultipleGrowth$422.820.79xyesExit EV/EBITDA: 11.2x / 13.2x / 15.2x (bear / base = today's held flat / bull), 5yr
Relative ValuationRelative$302.121.10xyesP/E 18x (static sector reference · 2026-04), scenarios: 15.3x / 18.0x / 20.7x (bear / base = reference held flat / bull), EV/EBITDA 12x
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$190.731.74xyesBV/sh $40.22, ROE (TTM) 43.9%, ke 9.3%
Two-Stage Excess ReturnAsset$477.680.70xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$269.321.23xyesRev $5.0B, growth -1% (input: historical growth; tapered), Terminal P/S: 2.3x / 2.7x / 3.2x (bear / base = today's held flat / bull, cap 8x)
Growth-Adjusted P/ERelative——no—
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$257.961.29xyesNormalized EBIT (5y avg op income, one-time charges added back) $1.02B × (1−22%) / WACC 7.8% → EPV (no growth)
Residual IncomeAsset$304.931.09xyesBV $40.22 + 5yr PV of (ROE (TTM) 43.9% − Kₑ 9.3%) × BV; BV grows 8.8%/yr
Graham NumberAsset$124.112.68xyes√(22.5 × EPS $17.02 × BVPS $40.22) — Graham's conservative floor
EV/EBITDA RelativeRelative$297.881.12xyesEBITDA $1.20B × sector EV/EBITDA 12.0x
FCF YieldEarnings$191.621.73xyesFCF $924.8M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings$183.051.82xyesSBC-adj FCF $0.89B (FCF $0.92B − SBC $0.03B) capitalized at Kₑ
Ben Graham FormulaEarnings$14.2623.31xyesEPS $17.02 × (8.5 + 2×-5.0%) × (4.4 / 5.3%) (excluded from median)
ROIC-Justified P/BAsset$19.3517.18xyesBV $40.22 × (ROIC 3.7% / WACC 7.8%)
P/Sales SectorRelative$302.691.10xyesRevenue $4.98B × sector P/S 2.5x
PEG Fair ValueRelative——no—
Earnings YieldEarnings$184.001.81xyesEPS $17.02 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt$2.1b
Net debt / NOPAT (after-tax)2.73x
Net debt / operating income (pre-tax)2.13x
Interest coverage12.6x
Share count CAGR (buyback)-6.1%
Burning cashno

Bullet Takeaways

At $361, the price pays about 17x company-wide operating income, which works out to roughly 11% annual operating-profit growth held for five years. That pace is within what Carlisle has recently delivered; the bet is on how long it persists, not the rate.

The business throws off real cash at a 20% operating margin, and the X-ray splits cleanly: relative-multiple and growth-DCF methods land at or above today's price, while asset-based and earnings-power methods sit below it. The same company looks fairly priced on multiples and expensive on book value.

Q1 2026 revenue fell about 4% to $1.05 billion on winter weather and a tough prior-year comparison, but management reaffirmed full-year low-single-digit revenue growth and now guides to double-digit EPS growth after recent price increases.

Bull Case

Building-products companies are awkward to value because the cash flows are tied to construction cycles that swing hard, but the underlying demand for a leak-free roof does not go away. Carlisle sits at the better end of that trade. Its core business is single-ply roofing membrane and weatherproofing systems sold mostly into non-residential construction, which is about 80% of the mix, with residential at roughly 17%. The 10-K frames the opportunity directly: management calls North America the most attractive building-products market globally, supported by long-term fundamentals including demand for energy-efficient weatherproofing solutions (FY2025 10-K, accession 0000790051-26-000012). When the dominant variable is energy code and re-roofing rather than new starts, the cycle gets less violent than the construction tag suggests.

The economics back that framing. The business runs a 20% operating margin and earns a high return on the capital it deploys, which is why the relative-multiple and growth-DCF methods both land at or above today's price. The Q1 2026 print reinforced the quality story even on a soft top line: revenue fell about 4% to $1.05 billion, yet operating margin rose to 17.1% and adjusted EBITDA margin hit 22.3%, up 50 basis points year over year. Carlisle is defending price and mix while volumes wobble.

Management is also returning the cash rather than empire-building. The weatherproofing segment grew 3% to $346 million in the quarter, with about $39 million of that from recent bolt-on acquisitions, while the company reaffirmed a $1 billion share-repurchase target for 2026. Share count has been shrinking at roughly 6% a year. After recent price-increase announcements, management lifted its outlook to the higher end of the low-single-digit revenue range and to double-digit EPS growth. The priced-in roughly 11% operating-growth assumption is within what the company has shown, so the bull case does not require heroics: it requires Carlisle to keep converting modest volume into double-digit per-share earnings through price, mix, and buybacks, which is exactly the playbook it just reaffirmed.

Bear Case

The moat here is narrower than the margins imply, and the edges are exposed. Carlisle's core membrane business depends on a concentrated set of distributor relationships, and the 10-K is explicit that a large portion of segment revenue comes from a few large customers, in markets that have seen recent consolidation among roofing-materials distributors (FY2025 10-K, accession 0000790051-26-000012). When a handful of consolidated distributors control shelf access, the manufacturer's pricing power is more conditional than a 20% operating margin suggests. A distributor that gains scale gains leverage, and the same price increases the bull case celebrates can be the lever a large buyer pushes back on next cycle.

The demand base is also more cyclical than the re-roofing narrative admits. The filing states plainly that the segments are susceptible to downturns in commercial construction, particularly repair and replacement, and that the weatherproofing segment is exposed to residential construction (FY2025 10-K, accession 0000790051-26-000012). Q1 2026 already showed the sensitivity: revenue down about 4%, with winter weather delaying projects and last year's quarter flattered by roughly $15 million of tariff-related order pull-forward from Canada. Strip the price increases and the underlying volume picture is soft. The methods that assume the cycle and the margins normalize are the ones flashing caution.

The structural tension is that the price embeds roughly 11% operating-profit growth sustained for five years, and history says only about 59% of comparable fast-growers held that pace that long. Carlisle is not pre-revenue or speculative, so the bear case is not about whether the business works; it is about paying a full multiple for a building-products company at a point where price increases, not volume, are doing the heavy lifting. Net debt sits near $2.1 billion against trailing operating income of about $1 billion, which is manageable at 2.1x and well-covered at nearly 11x interest, but it leaves less room to keep buying back stock if a genuine construction downturn arrives. If the price increases stick less than hoped, or distributors claw back margin, the conservative methods are the honest read and the stock has more downside to fair value than upside.

Valuation

Start from the price and work backward. At $361 the market is paying about 17x company-wide operating income, which inverts to roughly 11% annual operating-profit growth sustained over a five-year stage, solved at a 9.2% cost of capital with 4% terminal growth. That implied pace is broadly consistent with what Carlisle has delivered, so the assumption reads as within range rather than stretched. The sensitivity is meaningful though: each one-point change in the cost of capital moves the required growth by about 6.5 points, so the read is rate-dependent.

The model families disagree in a way that frames the decision. Growth-DCF and relative-multiple methods land at or above the price, with the DCF perpetual-growth read near $313, relative valuation near $302 on a sector-median 18x, and the DCF exit-multiple read up at $448. The asset and earnings-power families say the opposite: the simple excess-return method, anchored on book value of about $40 per share and a 44% trailing return on equity, lands near $191. That spread is the whole story. The price is justified if you weight Carlisle's margin and return profile through multiples and forward cash flow; it looks expensive if you anchor on book value or zero-growth earnings power.

The takeaway is that Carlisle is priced as a high-quality compounder, not a bargain. The reasonable-case methods support the price, the conservative methods do not, and the gap between them is the premium the market assigns to a 20% operating margin and a steady buyback. Wall Street's consensus price targets cluster near $393 to $410, which sits modestly above the current price and roughly in line with the upper-multiple methods, consistent with a stock the market views as fully but not absurdly valued.

Catalysts

The near-term setup is defined by Q1 2026 results reported April 23, 2026: revenue of $1.05 billion, down about 4% year over year on winter weather and a tough comparison, with adjusted EPS of $3.63 up 1%, and operating margin up to 17.1%. The most important forward signal was the guidance revision. Management reaffirmed full-year low-single-digit revenue growth and about 50 basis points of EBITDA margin expansion, then said recent price-increase announcements push revenue to the higher end of that range and EPS to double-digit growth. Whether those price increases hold through the year is the single catalyst worth tracking, since price and mix are carrying the earnings story while volumes stay soft.

Capital return is the other lever. Carlisle reaffirmed a $1 billion share-repurchase target for 2026, and with the share count already shrinking at roughly 6% a year, sustained buybacks are a direct support to per-share earnings. Bolt-on M&A in weatherproofing added about $39 million of revenue in the quarter, so continued tuck-in deals are a plausible incremental growth path. On sentiment, the analyst consensus is a Buy as of late June 2026, split roughly evenly between Buy and Hold ratings with price targets averaging in the high $300s to low $400s. The next earnings report and any update on price realization and non-residential construction demand are the events that would move the thesis in either direction.

Sources: Carlisle Q1 2026 8-K, Carlisle Q1 2026 earnings call transcript (Motley Fool), CSL analyst forecast (MarketBeat), CSL forecast (StockAnalysis).

Peer Cohorts (Per Segment, With Filing Citations)

Construction Materials (CCM) (reported)

Carlisle Weatherproofing Technologies (CWT) (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

View the full interactive CSL report on boothcheck