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Louisiana-Pacific Is Outperforming the Housing Recovery

Stocks in this article: LPXWYHDLOW

However, as with the fourth quarter, management offered no specific guidance other than to say the company is committed to meeting customer demand.

If there were any doubt about the housing recovery and its durability, Louisiana-Pacific's strong results should put these concerns to rest. New housing construction is improving. You can see it at Weyerhaeuser and in the are signs that Lowe's (LOW) and Home Depot (HD) have begun to see an increase in foot traffic.


That said, it remains a challenge to value Louisiana-Pacific from an investment point of view. Given how quickly the company was able to reverse a $11 million loss from the a year ago and the six-point sequential jump in gross margin, this is a company that is picking up momentum even as it appears the stock has lost steam.

On the basis of the first-quarter performance, this stock is worth at least 20% higher than current value. Investors who are looking for a great way to play the housing recovery should consider Louisiana-Pacific.

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.
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