SiteOne Landscape Supply, Inc. (SITE): what the price requires
At today's price, SiteOne Landscape Supply, Inc. (SITE) is priced for today's economics sustained for ~6.8 years. 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: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/SITE
Headline
| Field | Value |
|---|---|
| Ticker | SITE |
| Company | SiteOne Landscape Supply, Inc. |
| Current price | $104.50/sh |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 3.0% |
| Operating margin today | 4.7% |
| Margin compression implied | -1.7pp |
| Must persist for | 6.8y |
| Multiple paid | 26x 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 10.3% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~1.8 years.
Reconcile: at the x-ray's 9.3% required return this reads ~5 years; the models below use their own rates.
How unusual the bet is: elevated
| Reference | Value |
|---|---|
| vs own history | +0.37σ |
| cohort percentile (of 225 peers) | 61 |
| sustained it ~6.8 years at this level | 22% |
| implied end-window share | 0% |
Valuation X-Ray
The price is justified by relative-multiple; 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.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.80x | 4 | expensive |
| Earnings | 2.86x | 5 | expensive |
| Relative | 1.19x | 5 | expensive |
| Growth | 1.28x | 3 | expensive |
Families that justify the price: Relative Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.7%); the inversion above states its own rate.
Per-Model Detail (n=17)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $81.70 | 1.28x | yes | FCF base $0.2B, growth 3% (input: historical growth), terminal g 2.7%, WACC 7.7%, 5yr projection |
| DCF Exit Multiple | Growth | $90.53 | 1.15x | yes | Exit EV/EBITDA: 21.1x / 23.1x / 25.1x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $69.41 | 1.51x | yes | P/E 21.77x (blended: static sector reference 18x + trailing (TTM) 31x), scenarios: 18.4x / 21.8x / 25.1x (bear / base = reference held flat / bull), EV/EBITDA 15.32x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $36.98 | 2.83x | yes | BV/sh $36.37, ROE (TTM) 9.4%, ke 9.3% |
| Two-Stage Excess Return | Asset | $37.28 | 2.80x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $68.30 | 1.53x | yes | Rev $4.7B, growth 3% (input: historical growth; tapered), Terminal P/S: 0.8x / 1.0x / 1.1x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $87.99 | 1.19x | yes | EPS $3.38, growth 26% (input: historical EPS growth), PEG=1.17 (Fair) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $35.69 | 2.93x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.26B × (1−21%) / WACC 7.7% → EPV (no growth) |
| Residual Income | Asset | $37.33 | 2.80x | yes | BV $36.37 + 5yr PV of (ROE (TTM) 9.4% − Kₑ 9.3%) × BV; BV grows 6.1%/yr |
| Graham Number | Asset | $52.59 | 1.99x | yes | √(22.5 × EPS $3.38 × BVPS $36.37) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $44.42 | 2.35x | yes | EBITDA $0.24B × sector EV/EBITDA 12.0x |
| FCF Yield | Earnings | $39.04 | 2.68x | yes | FCF $246.1M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $32.35 | 3.23x | yes | SBC-adj FCF $0.22B (FCF $0.25B − SBC $0.03B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $109.06 | 0.96x | yes | EPS $3.38 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | — | — | no | — |
| P/Sales Sector | Relative | $263.84 | 0.40x | yes | Revenue $4.71B × sector P/S 2.5x |
| PEG Fair Value | Relative | $126.75 | 0.82x | yes | EPS $3.38 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $36.54 | 2.86x | yes | EPS $3.38 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $584.5m |
| Net debt / NOPAT (after-tax) | 3.41x |
| Net debt / operating income (pre-tax) | 2.69x |
| Interest coverage | 8.3x |
| Share count CAGR (buyback) | -0.7% |
| Burning cash | no |
Bullet Takeaways
- SiteOne is the largest wholesale distributor of landscaping supplies in the United States, growing by rolling up a fragmented market of local suppliers, and its sales are tied directly to residential construction, repair and upgrade activity.
- The price is rich on every standard lens: at about 27 times operating income it embeds growth held near the company's self-funding ceiling for roughly eight years, a pace only about a fifth of comparable fast-growers have sustained that long.
- What moves the story next is the mix of pricing, weather-driven volume, and acquisitions; the first quarter of 2026 saw flat net sales of $940.1 million with organic daily sales down 1% on poor weather, and full-year adjusted EBITDA is guided to $425 million to $455 million.
Bull Case
The obvious knock on SiteOne is the price, so meet it head-on: the stock trades richly on every backward-looking measure. The case for paying it rests on what the business is doing, which is consolidating a fragmented market faster than anyone else. SiteOne's strategy, in its own words, is to grow "with limited capital investment by systematically executing local strategies to expand our customer base, increase the amount of our customers' total spending with us, optimize our network of locations" and bolt on acquisitions. In a market of thousands of small local suppliers, the largest national distributor with multi-site delivery and breadth of product has a structural advantage a single-branch competitor cannot match. The first quarter of 2026 continued the roll-up with the acquisition of Reinders, a fifth-generation Midwest market leader, alongside Bourget Flagstone, together adding roughly $110 million in annualized sales.
The economics of the model are about share of wallet and density. Professional landscape contractors increasingly want one supplier that carries "local availability of core and complementary products in quantities our customers need," and SiteOne's full-line branches combine regular facilities with large yards that let it serve that demand. Each acquired branch plugs into the national network, gaining purchasing scale, private-label products, and digital ordering that an independent could not afford. That is why the company can keep growing even when end-market volume is soft: in the first quarter, despite organic daily sales falling 1% on weather, gross profit rose 3% and gross margin improved to 33.9% on better price realization and commercial initiatives.
The forward case is that pricing and acquisitions carry the company through a flat-demand year and reaccelerate when residential activity recovers. Management raised its pricing expectation to 2% to 3% for 2026 and expects that to offset flat volumes for low-single-digit organic growth, with full-year adjusted EBITDA guided to $425 million to $455 million. The balance sheet supports continued dealmaking, with net debt at about 2.4 times operating income and interest coverage near seven times. The bull case is a durable compounder using a soft cycle to buy competitors cheaply and emerge with more share.
Bear Case
The structural pressure point is that SiteOne's demand is not in its own hands. The 10-K is explicit that demand for its products "is highly correlated with residential construction, including repairs and upgrades," and that housing starts depend on "housing demand, housing inventory levels, housing affordability and mortgage rates." A distributor with a thin operating margin, near 5% on a trailing basis, has little cushion when volumes soften, and the first quarter of 2026 showed organic daily sales falling 1% on unfavorable weather alone. Weather and the housing cycle are exogenous, and the business is built to amplify both: a low-margin distributor levers small swings in volume into larger swings in profit.
The balance sheet adds a second layer of fragility because the growth model is funded with debt. SiteOne carries net debt of about 2.4 times operating income, and the roll-up depends on a steady cadence of acquisitions financed in part by borrowing. That is comfortable in a normal environment with interest coverage near seven times, but it ties the growth engine to credit conditions: if rates stay high or acquisition multiples rise, the accretion from each deal shrinks, and a soft demand year is exactly when integration risk and goodwill on the balance sheet matter most. The acquisitive growth that justifies the multiple is also what makes the company sensitive to the cost and availability of capital.
The valuation is where the bear bites hardest. At about 27 times operating income, no standard valuation family reaches the price: it is rich on assets, on earnings power, on peer multiples, and even on forward growth. The price embeds growth held near the company's self-funding ceiling for roughly eight years, and only about a fifth of comparable fast-growers have sustained that pace that long. The current operating margin near 5.1% is thin, and the price requires both that margin to expand and the growth to persist. If residential demand stays soft and pricing normalizes, the gap between a richly-priced compounder and a cyclically-exposed low-margin distributor closes the wrong way, and the multiple has far more room to compress than the fundamentals have to grow into it.
Valuation
Today's price pays about 27 times company-wide operating income, and what it embeds is durability of growth: operating profit held near the company's self-funding ceiling for roughly eight years. The near-term pace is within what SiteOne has recently delivered, so the bet is not on the rate but on how long it persists, and history is unkind to that duration, only about a fifth of comparable fast-growers sustained this pace for seven-and-a-half years. This is a premium paid for a compounder, and the premium assumes the compounding does not fade.
The spread across the methods says the price is a bet beyond what any standard frame supports. The asset-value and earnings-power methods land furthest below the price, the peer-multiple methods land below, and even the forward-growth methods, which credit next-period growth, do not reach it. When no family reaches the price, the market is not paying for what the business has demonstrated; it is paying for a long runway of continued consolidation and margin gains. Against its distribution cohort, this is a stretched valuation rather than a mid-pack one, reflecting SiteOne's faster acquisitive growth but also leaving the least room for disappointment.
The balance sheet is the boundary on the downside and a constraint on the upside at once. Net debt of about $584 million runs roughly 2.4 times operating income with interest coverage near seven times, which is manageable but leaves the growth model dependent on continued access to capital for acquisitions. The thin operating margin near 5% means cash generation is sensitive to volume, and a distributor's working capital swings with the season, with sales much lower in the first and fourth quarters. The decisive point for this price is not solvency, which is sound; it is that a 27-times multiple on a low-margin, housing-correlated distributor requires the acquisition machine and pricing power to keep delivering through a demand environment management itself expects to be down modestly for the year.
Catalysts
SiteOne reported first-quarter 2026 results in late April, with net sales essentially flat at $940.1 million against $939.4 million a year earlier. Organic daily sales fell 1% as unfavorable weather cut volumes, though pricing stayed positive and acquisitions added $12.4 million of sales. The margin story was the bright spot: gross profit rose 3% to $318.8 million and gross margin improved to 33.9% on better price realization and commercial initiatives. The first quarter is seasonally the company's weakest, so the read-through is more about pricing and margin direction than the headline volume.
The acquisition cadence remained active. SiteOne completed Reinders, a fifth-generation Midwest market leader, alongside Bourget Flagstone, with the two deals contributing roughly $110 million in annualized trailing sales. Each deal is a discrete catalyst for the roll-up thesis, adding branches and share, and the pace of acquisitions through the year is a direct input to growth given soft organic demand.
Management framed full-year 2026 around pricing offsetting flat volume. It raised its pricing expectation to 2% to 3% growth, expects overall end-market demand to be down modestly, and still targets flat sales volume and low-single-digit organic daily sales growth including acquisitions. Full-year adjusted EBITDA guidance is $425 million to $455 million, including a $4 million to $5 million headwind from an extra week in the year. Weather through the peak second and third quarters and the trajectory of residential demand are the swing factors for whether the company lands in the upper or lower half of that range.
Peer Cohorts (Per Segment, With Filing Citations)
SiteOne Landscape Supply (consolidated) (reported)
- POOL (POOL CORPORATION)
- (no filing in the citation store)
- CNM (Core & Main, Inc.)
- (no filing in the citation store)
- WSO (WATSCO INC)
- (no filing in the citation store)
- AIT (APPLIED INDUSTRIAL TECHNOLOGIES, INC.)
- (no filing in the citation store)
- MSM (MSC INDUSTRIAL DIRECT CO., INC.)
- (no filing in the citation store)
- DXPE (DXP Enterprises, Inc.)
- (no filing in the citation store)
- RS (RELIANCE, INC.)
- (no filing in the citation store)
- WCC (WESCO International, Inc.)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
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.
Sources
SITE Q1 2026 results, April 2026 · SITE 2026 guidance, April 2026