One of the hardest hit S&P/ASX 200 Index (ASX: XJO) shares over the past year has been James Hardie Industries plc (ASX: JHX) After such a heavy fall, it's definitely worth looking into whether the James Hardie share price should be viewed as an opportunity.
One of the fund managers that is invested in the construction materials business is L1.
L1 noted that while the James Hardie share price declined by 6% in November 2025, the business did see a rally of around 20% from the lows in early November, as shown in the chart below.
The decline of the James Hardie share price occurred following the announcement of an unexpected deletion, as the business saw its CDIs being deleted from the MSCI Australia Indices.
The surprise removal led to more than 10% of its shares on issue needing to be sold by passive share investors.
L1 decided to take advantage of that sell-off in early November to increase its shareholding near the lows of around $26 per share. The fund manager attributed that recovery during the month to an update in its full-year earnings guidance with its second-quarter earnings update. L1 also said the James Hardie share price recovered following the completion of the index transition in late November, ending the month at a value of around $30 per share.
In that quarterly update, James Hardie revealed that net sales rose by 34% to $1.29 billion, adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) increased 25% to $329.5 million, operating net profit sank 84% to $24 million and statutory net profit declined 167% to a loss of $55.8 million.
The net sales growth was primarily due to the US acquisition called AZEK. Organic net sales declined by 1%.
Is the current James Hardie share price a buy right now?
The fund manager noted that the outlook in the US remains uncertain, with consumers exercising caution and 'housing starts' remaining subdued.
The fund manager believes that the impacts are "transitory" and should improve over the next 12 to 18 months, with interest rates expected to decline. Consumer confidence is also projected to improve from here.
L1 believes that James Hardie, together with the recently acquired US business Azek, remains a "secular market share gainer in attractive industry verticals within the building products industry."
The fund manager suggests that it continues to see further upside from the current James Hardie share price.
