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Weyerhaeuser Co WY

Morningstar Rating
$34.15 −0.18 (0.52%)
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Company Report

We Still Expect Single-Family Construction and Repair and Remodel Spending to Grow in 2024

New single-family home sales increased 4% in 2023 to 666,000 units, as homebuilders capitalized on a dearth of existing for-sale inventory while also offering more sales incentives, cutting base home prices, and building smaller homes to improve affordability. By the fourth quarter of 2023, homebuilders began to pull back on sales incentives as the average 30-year fixed mortgage rate retreated from 7.62% in October 2023 to 6.64% in January 2024. However, mortgage rates have trended higher recently, and we now forecast the average 30-year fixed rate will be 6.50% in 2024, up from our previous forecast of 6.10%. Even so, that’s lower than the 2023 average of 6.81%, and we think homebuilders won’t hesitate to increase sales incentives if needed; they still enjoyed above-average gross profit margins last year with elevated incentives. As such, in 2024, we think new-home sales will increase 9% to 730,000 units and single-family housing starts will increase 4% to 985,000 units. However, we expect total housing starts will decline roughly 5% to 1,345,000 units due to a 23% decline in multifamily starts to 360,000 units, as there’s currently approximately 1,000,000 multifamily units under construction—the largest backlog in at least 50 years.

Price vs Fair Value

WY is trading at a 2% discount.
Price
$34.15
Fair Value
$46.00
Uncertainty
Medium
1-Star Price
$94.16
5-Star Price
$24.10
Economic Moat
Zrgy
Capital Allocation
Dhdrllyw

Bulls Say, Bears Say

Bulls

Weyerhaeuser’s growing mill capacity in the Southeastern U.S. will reduce its exposure to export taxes and trade disputes, allowing increased profit generation.

Bears

Weyerhaeuser’s reliance on lumber profitability could put the firm at risk during times of economic weakness.

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News

Trading Information

Previous Close Price
$34.33
Day Range
$33.9234.51
52-Week Range
$27.6535.43
Bid/Ask
$33.92 / $34.67
Market Cap
$24.91 Bil
Volume/Avg
3.4 Mil / 3.4 Mil

Key Statistics

Price/Earnings (Normalized)
33.48
Price/Sales
3.26
Dividend Yield (Trailing)
2.25%
Dividend Yield (Forward)
2.34%
Total Yield
2.78%

Company Profile

Weyerhaeuser ranks among the world's largest forest product companies. Following the 2016 sale of its pulp business to International Paper, Weyerhaeuser operates three business segments: timberlands, wood products, and real estate. Weyerhaeuser is structured as a real estate investment trust and is not required to pay federal income taxes on earnings generated by timber harvest activities. Earnings from its wood products segment are subject to federal income tax. Weyerhaeuser acquired fellow timber REIT Plum Creek in 2016.
Sector
Real Estate
Industry
REIT - Specialty
Stock Style Box
Mid Value
Total Number of Employees
9,318

Competitors

Valuation

Metric
WY
CFP
WFG
Price/Earnings (Normalized)
33.489.2310.42
Price/Book Value
2.430.500.92
Price/Sales
3.260.351.03
Price/Cash Flow
18.1313.52
Price/Earnings
WY
CFP
WFG

Financial Strength

Metric
WY
CFP
WFG
Quick Ratio
1.941.261.24
Current Ratio
2.942.492.26
Interest Coverage
4.08−12.86−11.58
Quick Ratio
WY
CFP
WFG

Profitability

Metric
WY
CFP
WFG
Return on Assets (Normalized)
4.36%−5.33%2.08%
Return on Equity (Normalized)
7.28%−8.58%2.71%
Return on Invested Capital (Normalized)
5.96%−7.20%2.07%
Return on Assets
WY
CFP
WFG
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