Weyerhaeuser Company (WY), which owns and operates timberlands across the United States and Canada, has reported stronger-than-expected Q2 2021 results. The company’s robust results were primarily driven by the growth in net sales.
Shares of the company fell 3.2% in Friday’s trading session. However, it pared its losses slightly to close at $33.77 in the extended trading session.
Weyerhaeuser reported quarterly net sales of $3.1 billion, up about 93% from the same period last year, beating the Street’s estimate of $3.01 billion.
The company reported quarterly earnings per share (EPS) of $1.37, which denotes a significant jump from $0.10 per share last year. It topped the consensus estimate of $1.34.
Notably, the company expects earnings in the third quarter of 2021 to be significantly higher than the third quarter of 2020 due to a lower average basis resulting from the mix of properties sold. The company has also raised its adjusted EBITDA guidance for the full year 2021 from $255 million to $290 million.
The CEO of Weyerhaeuser, Devin W. Stockfish, said, “Year-to-date, our adjusted EBITDA is almost $2 billion higher than this time last year and exceeds our full-year results for each of the last 14 years. We also generated record operating cash flow in the quarter and reduced long-term debt by another $225 million.”
“Looking forward, our outlook remains favorable for continued strength in residential construction, our financial position is exceptionally strong, and with year-to-date Adjusted Funds Available for Distribution of almost $1.9 billion, we are excited for the opportunity to return significant cash to shareholders through the variable supplemental component of our new dividend framework,” the CEO added. (See Weyerhaeuser stock chart on TipRanks)
Recently, D.A. Davidson analyst Kurt Yinger reiterated a Hold rating on the stock. The analyst, however, lowered the price target from $38 to $37, which implies upside potential of 9.7% from current levels.
The stock has a Moderate Buy consensus based on 5 Buys and 2 Holds. The average Weyerhaeuser price target of $39.67 implies 17.6% upside potential from current levels. Shares have gained 20.5% over the past year.
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