Weyerhaeuser Company’s WY shares dropped 0.4% in yesterday’s after-hours trading session after it reported mixed results for third-quarter 2024. Its earnings beat the Zacks Consensus Estimate, while net sales missed the same.

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On a year-over-year basis, both metrics declined due to lower fee harvest volumes in the West, a decrease in domestic sales volumes as well as sales realizations accompanied by increased lumber manufacturing and raw materials costs.

Nonetheless, the company delivered strong operational performance, benefiting from its embedded OpX culture and competitive cost structure. WY’s solid balance sheet supports resilience across various market conditions, reflecting the strength of its portfolio and disciplined capital allocation. Looking ahead, Weyerhaeuser holds an optimistic view of the demand fundamentals driving growth across its businesses.

Weyerhaeuser’s Earnings & Sales Discussion

The company reported adjusted earnings of 5 cents per share, which surpassed the Zacks Consensus Estimate of 2 cents. The bottom line, however, decreased 84.8% from the year-ago reported figure of 33 cents per share.

Net sales for the quarter were $1.68 billion, which missed the consensus mark of $1.75 billion by 3% and declined 16.9% from $2.02 billion reported in the year-ago quarter.

Adjusted EBITDA was $236 million, down 53.6% from $509 million in the year-ago period.

WY’s Segment Details

Timberlands: Net sales (including inter-segment sales of $136 million) from the segment were $493 million, down from the year-ago figure of $521 million. Meanwhile, we expected segment sales to decline 1.9% year over year to $511 million in the quarter. Adjusted EBITDA was $122 million, down from $143 million in the year-ago quarter.

Real Estate, Energy and Natural Resources: For the reported quarter, the segment’s net sales amounted to $89 million, down from $105 million a year ago.  We expected segment sales to decline to $98.9 million in the quarter. Adjusted EBITDA was $77 million, indicating a decline from $94 million reported in the year-ago period.

Wood Products: In the third quarter, the segment’s sales totaled $1.2 billion, down from $1.5 billion in the year-ago period. The reported figure is in line with our expectations. Adjusted EBITDA was $91 million, down from $328 million a year ago.

WY’s Financial Highlights

As of Sept. 30, 2024, Weyerhaeuser had cash and cash equivalents of $877 million, down from $1.16 billion at the end of 2023. Long-term debt was $4.86 billion at the third-quarter end, down from $5.07 billion at 2023 end.

Net cash from operations was $234 million for the third quarter of 2024, down from $523 million reported in the year-ago period.

Weyerhaeuser’s Q4 Outlook

For fourth-quarter 2024, for Timberland, Weyerhaeuser expects earnings and adjusted EBITDA to align closely with third-quarter results. In the West, the company anticipates slightly lower log and haul costs, with modestly reduced fee harvest volumes and lower sales realizations due to product mix. In the South, Weyerhaeuser predicts an increase in fee harvest volumes and per-unit log and haul costs, while sales realizations are likely to remain stable. Additionally, higher forestry and road costs are expected in the South.

In the Real Estate, Energy and Natural Resources segment, Weyerhaeuser expects fourth-quarter earnings and adjusted EBITDA to decrease approximately $10 million from the prior quarter, primarily due to timing and sales mix in real estate. For 2024, the company now anticipates adjusted EBITDA to reach about $340 million, up $10 million from the previous forecast, with a basis percentage for real estate sales expected to be between 40% and 45%.

Within the Wood Products segment, Weyerhaeuser expects its fourth-quarter earnings before special items and adjusted EBITDA to slightly exceed third-quarter levels, excluding changes in lumber and oriented strand board prices. For lumber, the company predicts higher sales volumes, along with reduced log and unit manufacturing costs.

For OSB, it anticipates moderately higher sales volumes and reduced unit manufacturing costs despite a slight rise in fiber costs. Engineered wood products are expected to see lower sales volumes, moderate declines in sales prices and reduced raw material costs. In the distribution segment, Weyerhaeuser anticipates slightly lower results than the previous quarter.

Zacks Rank & Recent Construction Releases

Weyerhaeuser currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

KBR, Inc. KBR reported mixed third-quarter fiscal 2024 results, with adjusted earnings surpassing the Zacks Consensus Estimate while revenues missed the same. The top and the bottom line increased on a year-over-year basis.

The quarter’s results were backed by the benefits realized from the LinQuest acquisition and solid contributions from both the reportable businesses, given the increased demand trends for its services. Although high costs and expenses were trouble, leverage from the increased top line aided the uptick in the quarter.

United Rentals, Inc. URI reported third-quarter 2024 results, wherein its earnings per share (EPS) and revenues fell short of the Zacks Consensus Estimate. Nonetheless, both metrics registered improvement on a year-over-year basis.

The company has tightened the outlook ranges for revenues, adjusted EBITDA, rental capital expenditures and net cash from operating activities while reaffirming the mid-points of its 2024 forecast.

NVR, Inc. NVR reported mixed third-quarter 2024 results, with earnings missing the Zacks Consensus Estimate and Homebuilding revenues surpassing the same. On the other hand, both metrics increased on a year-over-year basis.

This upside was backed by improved demand trends, which resulted in higher settlements. Although the cancelation rate increased in the quarter, growth in new orders is encouraging for the company.

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