This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Weyerhaeuser Surges on Sandy, but Wait for Lower Levels

Not only are consensus EPS estimates strong for fiscal year 2013 at $1.23 per share, but the growth is expected to continue into next year as evidenced by fiscal 2014 estimates of $1.49 per share.

Given that Bloomberg expects Weyerhaeuser to report revenue for fiscal 2014 of $8.9 billion, this stock can yet be undervalued if the company is able to meet this revenue target along with EPS estimates of $1.49 per share.

Weyerhaeuser's average P/E over the past couple of years has been 33. With fiscal 2014 EPS projections of $1.49, this stock can possibly reach a fair value of $50, which would make the stock a strong buy today.

Bottom Line

Weyerhaeuser (the surname of co-founder Frederick) has a solid market position when it comes to timberland and wood products. The question, though, is what phase of the recovery the market is in. Given Weyerhaeuser's strong first-quarter performance and solid second-quarter guidance, I won't dispute that this century-old company is growing and should continue to be a solid play in new home construction/rebuilds.

On the strength of a sustained housing recovery, including 2013 housing starts, which is at an estimated 990,000, there's still plenty of justification for long-term bullishness. In the near-term, however, the stock might need a breather, and a slight pullback, possibly to $27 per share, would be a great point of entry.

At the time of publication, the author held no position in any of the stocks mentioned.

This article  was written by an independent contributor, separate from TheStreet's regular news coverage.
Richard Saintvilus is a private investor with an information technology and engineering background and the founder and producer of the investor Web site Saint's Sense. He has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.
3 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
LPX $16.51 -1.70%
WY $31.69 -0.13%
AAPL $124.38 -1.30%
FB $85.47 -2.40%
GOOG $516.43 -1.20%

Markets

DOW 17,520.60 -162.98 -0.92%
S&P 500 2,049.31 -19.45 -0.94%
NASDAQ 4,917.3830 -74.5570 -1.49%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs