TRG | The Bottom Line – 10/31

As professional sports hit their equinox this week (the rare occurrence when NFL, MLB, NBA, NHL all play on the same day), so too are corporate earnings. The array of companies in TRG’s universe that have so far reported are, overall, aligning with channel checks. Resi remains handcuffed, with no light at the end of the tunnel. Equipment rental and leasing has challenges in local markets, but megaprojects are still quite robust. Materials’ companies are seeing resilient results due to solid pricing, steady spending on roads, and their non-res volumes are also influenced by the diverging local/megaproject activity. Office and interior commercial spending was positive and broader office fundamentals are evolving in a positive manner. The go-forward outlook still is levered to rates – if they go lower, and it translates to lower borrowing rates (for 30-year mortgage and commercial development), this would be tremendous volume upside for many companies in our coverage. But, many companies in our coverage have unique features of durability in their business, helping to support results in 2025 and 2026, should higher rates persist. This was on display in the reported Q3 results thus far.