Why Is Resideo Technologies (REZI) Stock Down -16% Today?
Key Takeaways
- Resideo Technologies (REZI) shares plunged 15.91% to close at $30.85, following a previous close of $36.68.
- The primary catalyst was disappointing Q2 guidance, with revenue projected at $1.916-$1.94 billion (below consensus $1.978 billion) and adjusted EPS at $0.71-$0.75 (below $0.84).
- Q1 results beat expectations, with revenue up 8% to $1.91 billion and adjusted EPS of $0.65, but markets focused on forward outlook.
- Trading volume surged to nearly 4 million shares, over 3x the average of 1.23 million.
- Broader market mixed; industrials sector underperformed amid cost pressures from rising freight and fuel.
- Traders watch Q2 execution, ADI spin-off progress, and macroeconomic headwinds in residential AV market.
Opening Thoughts on the Sell-Off
I've been keeping an eye on Resideo Technologies, Inc. (REZI), the company behind smart home comfort, security, and energy management solutions across its Products & Solutions and ADI Global Distribution segments. Yesterday, shares took a sharp hit, dropping 15.91% to close at $30.85 from the prior close of $36.68. From what I see, the trigger was weaker-than-expected Q2 guidance, even as Q1 numbers came in strong after the bell on May 12.
Q1 Delivered a Solid Beat
Resideo's Q1 performance stood out positively. Net revenue reached $1.91 billion, marking an 8% year-over-year increase and hitting the high end of prior guidance. Adjusted EPS was $0.65, up 3% from last year and ahead of consensus estimates. Adjusted EBITDA climbed 28% to $215 million. In the Products & Solutions segment, revenue grew 9% to $706 million, with margins improving to 41.8%. ADI Global Distribution also saw 8% expansion. CEO Jay Geldmacher emphasized the team's operational execution in a challenging macro environment, and I think that resilience is worth noting.
Q2 Outlook Sparks the Sharp Decline
That said, the Q2 guidance overshadowed the Q1 strength and drove the sell-off. Management projected net revenue of $1.916-$1.94 billion and adjusted EPS of $0.71-$0.75—both below Wall Street's $1.978 billion and $0.84 expectations. Full-year guidance held steady at $7.8-$7.9 billion in revenue and $3.00-$3.20 adjusted EPS. One thing that stands out in their commentary is softening demand in high-end residential audio-visual markets, along with margin pressures from higher freight and fuel costs linked to oil prices and shipping disruptions. They're planning price hikes to help offset those headwinds.
Trading Volume and Market Backdrop
Trading activity reflected the intensity, with volume spiking to nearly 4 million shares—more than triple the average of 1.23 million. This move diverged from mixed broader indices, where the industrials sector lagged due to commodity cost pressures. While peers in industrial distribution held up relatively better, REZI faced company-specific worries. Technically, the stock gapped below key support around $36.50, which aligns with recent lows and the 50-day moving average near $37. I'm watching next support at $30, with potential rebound resistance near $36. I also checked this using Tickeron’s AI Screener to gauge how REZI stacks up against industry peers.
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What's Ahead for REZI
Looking forward, execution in Q2 will be key, especially on pricing and cost controls amid those guidance risks. The ADI Global Distribution spin-off remains a significant milestone that could unlock value for both businesses. Analyst consensus stays constructive, with an average price target of $49 and FY2026 EPS forecasts around $2.90-$3.13. Broader factors like residential construction trends and supply chain stability will play a big role. In my view, risks persist from extended housing softness and ongoing logistics inflation, so I'm watching this closely.
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REZI's RSI Indicator ascends from oversold territory
The RSI Indicator for REZI moved out of oversold territory on May 26, 2026. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 32 similar instances when the indicator left oversold territory. In of the 32 cases the stock moved higher. This puts the odds of a move higher at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on May 28, 2026. You may want to consider a long position or call options on REZI as a result. In of 88 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for REZI just turned positive on June 01, 2026. Looking at past instances where REZI's MACD turned positive, the stock continued to rise in of 45 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where REZI advanced for three days, in of 312 cases, the price rose further within the following month. The odds of a continued upward trend are .
REZI may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In of 245 cases where REZI Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 56 cases where REZI's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
REZI moved below its 50-day moving average on May 12, 2026 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for REZI crossed bearishly below the 50-day moving average on May 15, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In of 18 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
The 50-day moving average for REZI moved below the 200-day moving average on May 20, 2026. This could be a long-term bearish signal for the stock as the stock shifts to an downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where REZI declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Fundamental Analysis (Ratings)
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is slightly undervalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.866) is normal, around the industry mean (4.988). P/E Ratio (87.433) is within average values for comparable stocks, (151.762). REZI's Projected Growth (PEG Ratio) (0.000) is very low in comparison to the industry average of (2.030). REZI has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.020). P/S Ratio (0.595) is also within normal values, averaging (1.591).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. REZI’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. REZI’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 72, placing this stock worse than average.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
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a provider of household security solutions
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