Seattle-based Weyerhaeuser Company (WY) is one of the world's largest owners of timberlands. With a market cap of $24.2 billion, the company has control over approximately 11 million acres of timberlands in the U.S. and manages additional timberlands under long-term licenses in Canada.
Companies worth $10 billion or more are generally described as "large-cap stocks," Weyerhaeuser fits right into that category, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the specialty REITs industry. Its operations are concentrated in Southern California, Nevada, Washington, Texas, Maryland, and Virginia. The company caters to a diverse clientele spread across the U.S., Canada, Japan, Europe, and other regions.
Weyerhaeuser touched its 52-week high of $36.27 on Mar. 28 and is currently trading 9.6% below that peak. WY gained 14.7% over the past three months outpacing the Dow Jones Industrials Average’s ($DOWI) 6.9% gains during the same time frame.
However, over the longer term, Weyerhaeuser has underperformed DOWI. WY gained 2.7% over the past 52 weeks and dipped 4.8% in 2024, lagging behind DOWI’s 19.9% gains over the past year and 10.1% returns on a YTD basis.
Additionally, WY has mostly traded below its 200-day moving average since mid-April but above its 50-day moving average since mid-July.
Despite falling short of Wall Street’s expectations, Weyerhaeuser’s shares surged 4.3% in the trading session after the release of its Q2 earnings on July 25. The company reported a 2.9% annual sales decline to $1.9 billion. This decline was largely driven by a 5.3% net sales decrease in its wood products segment, which fell to $1.4 billion.
However, the Real Estate & ENR segment demonstrated remarkable strength, with net sales soaring by 36.3% to $109 million. Additionally, the company repurchased 1.7 million common shares for approximately $50 million during the quarter, signaling strong shareholder commitment and confidence in its valuation.
Weyerhaeuser’s competitor Rayonier Inc. (RYN) has gained 4.4% over the past year outpacing WY. However, RYN has dipped 5.5% in 2024 underperforming WY on a YTD basis.
Among the 11 analysts covering the WY stock, the consensus rating is a “Moderate Buy.” The mean price target of $35.89 represents a potential upside of 8.4% from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
