Yahoo Finance Boise Cascade (BCC) Up 1.1% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Boise Cascade (BCC). Shares have added about 1.1% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Boise Cascade due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Boise Cascade Q1 Earnings & Sales Top Estimates, Up Y/Y
Boise Cascade reported splendid first-quarter 2024 results wherein earnings and sales topped the Zacks Consensus Estimate and increased year over year.
The uptrend in the company’s results was attributable to the seasonal tailwinds and strength in new single-family housing starts resulting in sales volume growth. These factors aided the increased contributions from BCC’s two reportable segments.
The company remains optimistic about the increasing trajectory of single-family housing starts given the low supply of existing single-family homes, as this metric is the key driver of its sales. Also, it aims to effectively allocate its capital and ensure shareholder value along with fostering its growth.
Detailed Discussion
Boise Cascade reported adjusted earnings per share (EPS) of $2.61, beating the Zacks Consensus Estimate of $2.30 by 13.5%. In the year-ago quarter, the company reported adjusted EPS of $2.43.
Quarterly sales of $1.65 billion beat the consensus estimate of $1.56 million by 5.3% and grew year over year by 7% from the prior year’s figure of $1.54 billion.
Adjusted EBITDA of $168.5 million was up 6% from the prior-year quarter’s level.
Segmental Analysis
Wood Products: The segment’s sales (including sales to BMD segment) of $468.9 million were up 7.2% from the prior-year period. The uptick was backed by higher sales volumes for engineered wood products (EWP) and higher plywood sales prices.
Adjusted EBITDA was $95.6 million, up 3% from $93.2 million reported a year ago.
During the quarter, the segment’s costs and expenses – as a percentage of segment sales – increased to 84.8% from 84.1% year over year. The increase in materials, labor and manufacturing costs drove the uptick.
Building Materials Distribution or BMD: Sales in the segment increased 9% year over year to $1.51 billion, primarily driven by sales volume increases of 12%.
The segment’s adjusted EBITDA grew 9% year over year to $83.6 million from $76.8 million.
The segment’s costs and expenses – as a percentage of segment sales – increased to 95.2% from 94.9% year over year. The increase in selling and distribution expenses along with distribution and amortization attributed to the uptick.
Financials
The total liquidity of Boise Cascade, as of Mar 31, 2024 was $1.29 billion, down from $1.35 billion reported at the end of Dec 31, 2023. Total liquidity includes $395.7 million of undrawn committed bank line availability, and cash and cash equivalents. At first-quarter 2024 end, the company had cash and cash equivalents of $890.2 million, down from $949.6 million at 2023 end.
Long-term debt was $445.5 million, marginally up from $445.3 million reported at 2023 end.
As of Mar 31, 2024, net cash provided by operations was $27.5 million, down from $48 million reported at the year-ago period.
During the first- quarter, the company repurchased 205,938 shares of its common stock for a total value of $27 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -10.38% due to these changes.
VGM Scores
Currently, Boise Cascade has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Boise Cascade has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Boise Cascade belongs to the Zacks Building Products - Wood industry. Another stock from the same industry, Rayonier (RYN), has gained 1.9% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.
Rayonier reported revenues of $168.1 million in the last reported quarter, representing a year-over-year change of -6.1%. EPS of $0.05 for the same period compares with $0.01 a year ago.
For the current quarter, Rayonier is expected to post earnings of $0.14 per share, indicating a change of +180% from the year-ago quarter. The Zacks Consensus Estimate has changed -3.5% over the last 30 days.
Rayonier has a Zacks Rank #4 (Sell) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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Boise Cascade, L.L.C. (BCC) : Free Stock Analysis Report
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