PotlatchDeltic Corporation PCH is slated to report its fourth-quarter 2024 results on Jan. 27, after market close.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

In the last quarter, adjusted earnings and revenues topped the Zacks Consensus Estimate by 200% and 6.6%, respectively. However, on a year-over-year basis, both metrics declined 71.4% and 4.1%, respectively.

PCH’s earnings topped the consensus mark in two of the trailing four quarters, met on one occasion and missed on the remaining one occasion, with an average surprise of 50%.

Trends in PotlatchDeltic’s Estimate Revision

The Zacks Consensus Estimate for adjusted earnings per share has increased from a loss of 5 cents to a break-even point over the past 30 days. The current estimate is at par with the year-ago quarter’s figure.

The consensus mark for revenues is pegged at $241.2 million, indicating 5.2% decline from the year-ago quarter.

Factors Likely to Define PCH’s Q4 Results

Revenues

PotlatchDeltic’s fourth-quarter top-line performance is likely to have declined year over year due to the seasonally slow trends witnessed in the last few months of the year, lower lumber prices and decreased Northern sawlog prices. Also, lower lumber shipments because of the planned downtime and restart at its Waldo, AR sawmill are expected to have added to the headwinds.

That said, increased rural acres and residential lots sold accompanied with a favorable average price per residential lot sold, given the improving housing market and a declining interest rate scenario, is likely to have negated the impacts of the headwinds to some extent.

The Zacks Consensus Estimate for revenues of the Timberlands and Wood Products segments is pegged at $98 million and $154 million, up year over year from $97 million and $150 million, respectively. On the other hand, revenues for the Real Estate segment are expected to be $20 million, down year over year from $27.91 million. The decline in contributions from the Real Estate segment is expected to have overshadowed the marginal growth across the other two segments during the quarter.

Margins

The bottom-line performance of PCH is expected to have been hindered due to the persisting inflationary environment and increased cost and expense structure. The selling, general and administrative expenses are expected to have moved up due to increases in professional service fees, including costs for the implementation of new systems and employee-related costs. Furthermore, increased rural real estate acres and residential lots sold, along with increased log and haul costs associated with higher harvest activity, are likely to have added to the cost increase.

Nonetheless, lower raw material, production and shipping costs primarily at the Waldo, AR sawmill, along with PotlatchDeltic’s ongoing efforts to gain operational excellence and expand margins, are likely to have partially offset the adverse impact on the margins during the quarter.

What the Zacks Model Unveils About PCH

Our proven model does not conclusively predict an earnings beat for PotlatchDeltic this time around. The company does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — to increase the odds of an earnings beat.

Earnings ESP: PCH has an Earnings ESP of 0.00%. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks With the Favorable Combination

Here are some companies in the Zacks Construction sector, which according to our model, have the right combination of elements to beat on earnings in their respective quarters to be reported.

Louisiana-Pacific Corporation LPX has an Earnings ESP of +11.79% and a Zacks Rank of 2.

LPX reported better-than-expected earnings in each of the last four quarters, the average surprise being 30.7%. The company’s earnings for the fourth quarter of 2024 are expected to increase 4.2%.

Sterling Infrastructure, Inc. STRL currently has an Earnings ESP of +2.99% and a Zacks Rank of 3.

STRL’s earnings for the fourth quarter of 2024 are expected to increase 3.1%. The company reported better-than-expected earnings in each of the last four quarters, the average surprise being 21.5%.

PulteGroup, Inc. PHM currently has an Earnings ESP of +2.36% and a Zacks Rank of 3.

PHM’s earnings for the fourth quarter of 2024 are expected to decrease 2.1%. The company reported better-than-expected earnings in each of the last four quarters, the average surprise being 10.9%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

PulteGroup, Inc. (PHM) : Free Stock Analysis Report

Louisiana-Pacific Corporation (LPX) : Free Stock Analysis Report

Potlatch Corporation (PCH) : Free Stock Analysis Report

Sterling Infrastructure, Inc. (STRL) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research