Rayonier Earnings Preview

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Watch Rayonier's (NYS: RYN) earnings report to see if it can beat analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday, July 28. Rayonier is an international forest products company, which is engaged in activities associated with timberland management, the sale and entitlement of real estate, and the production and sale of high-value specialty cellulose fibers and fluff pulp.

What analysts say:

  • Buy, sell, or hold?: Analysts strongly back Rayonier, with five of eight rating it a buy and the remainder rating it a hold. Analysts like Rayonier better than competitor Plum Creek Timber overall. Wall Street has warmed to the stock over the past three months, with analysts increasing their endorsement from hold to moderate buy.
  • Revenue Forecasts: On average, analysts predict $355.6 million in revenue this quarter. That would represent a rise of 13.9% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.73 per share. Estimates range from $0.68 to $0.79.

What our community says:
CAPS All Stars are solidly behind the stock, with 97.4% granting it an "outperform" rating. The community at large backs the All Stars, with 95.7% assigning it a rating of "outperform." Fools are bullish on Rayonier, though the message boards have been quiet lately with only 95 posts in the past 30 days. Even with a robust four out of five stars, Rayonier's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Rayonier's income has fallen year over year by an average of 30.9%. Revenue has now gone up for three straight quarters. The company upped its gross margin by 3.1 percentage points in the last quarter. Revenue rose 15.3% while cost of sales rose 10.6% to $257.5 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters:

Quarter

Q1

Q4

Q3

Q2

Gross Margin

28.0%

22.3%

28.7%

22.2%

Operating Margin

24.0%

18.0%

24.4%

18.0%

Net Margin

16.3%

18.8%

16.7%

12.4%

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At the time this article was published

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