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Masco (NYSE:MAS) reports Monday night, July 30th, after the bell with a conference call Tuesday morning. Analyst consensus for the fiscal 2nd quarter is looking for $0.11 in earnings per share (EPS) on $2.08 billion in revenues for expected year-over-year growth of 120% and 3% respectively.

Our analyst model's for MAS only go back as far as 2005, when the building materials looked to have generated peak earnings of $2 per share, coincident with the stock peaking at $38.50 in early January, 2005.

We've never owned MAS and with a $4.5 billion market cap, it is a smaller company than we usually traffic in for clients, but with the recovery in housing and homebuilding, and the fact that it is being weighed down by Europe, and thus hasn't participated in this latest housing rally, we're putting it on the radar screen.

Here is MAS's earnings history including historical and expected earnings:

2005 - $2.01

2006 - $1.20

2007 - $1.29

2008 - ($1.09)

2009 - ($0.42)

2010 - ($2.99)

2011 - ($1.43)

2012 - $0.31 (estimated current consensus i.e. cc)

2013 - $0.63 (est. cc)

2014 - $0.98 (est. cc)

2015 - $1.48 (est. cc)

MAS lost a lot of money from 2008 - 2011, but if forward consensus is even remotely accurate, and of the stock can trade at the 15(x) - 20(x) multiple it did in a favorable housing market, MAS is a $20 - $25 stock a few years out, assuming a somewhat normal housing recovery.

In Q1 2012, MAS revenues increased 6%, and generated operating EPS of $0.05 a share (versus a $0.01 estimate) on better operating margins and gave a positive outlook on the US housing market. MAS will benefit from both repair and remodeling of US homes (about 45% of revenues), new construction (about 30% of revenues), and Europe.

If you peruse MAS's financials, Europe is about 25% of revenues and operating income and needless to say it is a drag right now. Nishu Sood, DeutscheBank's housing and homebuilding analyst (and in my opinion the best analyst in the group), recently cut his 2013 EPS estimate from $0.75 to $0.57 per share, primarily due to Europe and "big ticket" sales.

MAS closed at $13.30 on Friday, July 27th, and ideally we would buy it if it slipped under $12. The June housing data looked somewhat light, and we are expecting a pullback in the homebuilders.

Right now, the US operations are good, while Europe isn't, which is a familiar refrain. Be patient, and wait for your moment to buy.

Source: Masco Earnings Preview: Early-Cycle Building Materials Company With Earnings Potential