Analyzing Weyerhaeuser (WY) and Its Competitors

Weyerhaeuser (NYSE: WY) is one of 82 public companies in the “BUILDING PRODS” industry, but how does it contrast to its competitors? We will compare Weyerhaeuser to similar companies based on the strength of its risk, profitability, valuation, dividends, analyst recommendations, earnings and institutional ownership.

Profitability

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This table compares Weyerhaeuser and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Weyerhaeuser 8.09% 9.62% 4.68%
Weyerhaeuser Competitors 5.13% 38.41% 5.14%

Analyst Recommendations

This is a summary of current ratings and target prices for Weyerhaeuser and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Weyerhaeuser 0 3 5 0 2.63
Weyerhaeuser Competitors 422 1945 2228 97 2.43

Weyerhaeuser currently has a consensus price target of $37.25, indicating a potential upside of 5.26%. As a group, “BUILDING PRODS” companies have a potential upside of 11.31%. Given Weyerhaeuser’s competitors higher possible upside, analysts plainly believe Weyerhaeuser has less favorable growth aspects than its competitors.

Dividends

Weyerhaeuser pays an annual dividend of $1.28 per share and has a dividend yield of 3.6%. Weyerhaeuser pays out 166.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “BUILDING PRODS” companies pay a dividend yield of 1.5% and pay out 32.4% of their earnings in the form of a dividend. Weyerhaeuser has increased its dividend for 6 consecutive years.

Volatility & Risk

Weyerhaeuser has a beta of 1.43, indicating that its stock price is 43% more volatile than the S&P 500. Comparatively, Weyerhaeuser’s competitors have a beta of 1.30, indicating that their average stock price is 30% more volatile than the S&P 500.

Valuation & Earnings

This table compares Weyerhaeuser and its competitors revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Weyerhaeuser $7.20 billion $582.00 million 45.96
Weyerhaeuser Competitors $3.38 billion $212.39 million -0.91

Weyerhaeuser has higher revenue and earnings than its competitors. Weyerhaeuser is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Institutional & Insider Ownership

76.0% of Weyerhaeuser shares are owned by institutional investors. Comparatively, 64.5% of shares of all “BUILDING PRODS” companies are owned by institutional investors. 1.2% of Weyerhaeuser shares are owned by company insiders. Comparatively, 10.9% of shares of all “BUILDING PRODS” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Weyerhaeuser beats its competitors on 9 of the 15 factors compared.

Weyerhaeuser Company Profile

Weyerhaeuser Company is a timber, land and forest products company. As of December 31, 2016, the Company owned or controlled 13.1 million acres of timberlands, primarily in the United States, and manages additional timberlands under long-term licenses in Canada. The Company’s segments include Timberlands; Real Estate, Energy and Natural Resources (Real Estate & ENR), and Wood Products. The Timberlands segment’s offerings include logs, timber and recreational access via leases. The Real Estate & ENR segment includes sales of timberlands; rights to explore for and extract hard minerals, oil and gas production, and coal, and equity interests in its Real Estate Development Ventures. The Wood Products segment includes the manufacturing and distribution of wood products. The Wood Products segment is engaged in softwood lumber, engineered wood products, structural panels, medium density fiberboard and building materials distribution.

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