James Hardie shares rebound from 5-year low. Is the worst finally over?

James Hardie Industries plc (ASX: JHX) shares are showing early signs of stabilising after a tough year.

The building materials group hit a 5-year low of $24.41 on 17 November, capping off months of heavy selling. Since then, the share price has clawed back some ground. On Friday, James Hardie shares jumped 5.12% to close at $32.42.

Even after that rebound, the stock remains around 35% lower than this time last year, highlighting just how far sentiment has fallen. The recent price action suggests investors may now be reassessing whether the pessimism has gone too far.

Let’s take a closer look.

A rough year for a quality business

James Hardie is a global leader in fibre cement products, with strong brands and exposure to long-term housing demand in the US and other key markets.

However, 2025 was a difficult year. Higher interest rates slowed construction activity, while rising costs pressured margins. On top of that, the company’s large AZEK acquisition added complexity, integration costs, and uncertainty around near-term earnings.

As a result, investors steadily downgraded their expectations, driving the share price lower towards the back end of the year.

By the time the stock hit its 5-year low in November, much of the bad news appeared to be priced in.

Recent results offered some relief

In its Q2 FY26 results, James Hardie delivered a mixed but improving update.

Net sales rose 34% to around US$1.29 billion, supported by contributions from AZEK and steady demand across core regions. Adjusted EBITDA increased 25% to approximately US$330 million, leading management to lift full-year EBITDA guidance.

That guidance upgrade helped stabilise sentiment, even though statutory profit remained under pressure due to acquisition-related costs.

Insider activity sends mixed signals

One factor that caught investors’ attention was director Jesse Singh selling a large number of shares at the start of 2026.

While insider selling can occur for many personal reasons, it often makes investors cautious, particularly when a stock has already fallen heavily.

That said, there has also been director buying late in 2025, suggesting views within the board are mixed rather than outright negative.

What the chart is telling us

From a technical perspective, James Hardie shares appear to be forming a short-term uptrend.

Recent price action suggests buyers are gradually stepping back in. However, the broader trend remains weak, and the shares still face resistance in the mid $30 range.

Foolish takeaway

James Hardie’s share price collapse has reset expectations significantly.

The recent rebound suggests investors may be starting to re-rate the stock as earnings stabilise and uncertainty fades. However, a sustained recovery will likely depend on improved margins and smoother execution through 2026.

The post James Hardie shares rebound from 5-year low. Is the worst finally over? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.