Universal Forest Products Earnings Preview

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Universal Forest Products (NAS: UFPI) didn't meet the Street's expectations last quarter, but investors hope that it will rebound this quarter. The company will unveil its latest earnings on Wednesday, Feb. 15. Universal Forest Products provides capital, management, and administrative resources to subsidiaries that design, manufacture, and market wood and wood-alternative products for DIY/retail home centers and other retailers.

What analysts say:

  • Buy, sell, or hold?: Half of analysts think investors should stand pat on Universal Forest Products while the remaining half are split between buy and sell. Analysts like Universal Forest Products better than competitor Louisiana-Pacific overall. Two out of 12 analysts rate Louisiana-Pacific a buy compared to one of four for Universal Forest Products. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $372.4 million in revenue this quarter. That would represent a decline of 1.7% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is a loss of $0.04 per share. Estimates range from a loss of $0.06 to a loss of $0.03.

What our community says:
The majority of CAPS All-Stars see Universal Forest Products as a good bet, with 81.1% giving it an "outperform" rating. The greater community backs the All-Stars, as 78.5% give it a rating of "outperform." Fools have embraced Universal Forest Products, though the message boards have been quiet lately with only 70 posts in the past 30 days. Universal Forest Products' bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Revenue has fallen for the past three quarters.

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

Q3

Q2

Q1

Q4

Gross Margin

11.6%

10.4%

10.7%

12.2%

Operating Margin

2.2%

1.4%

(1.3%)

(0.6%)

Net Margin

1.2%

0.8%

(0.9%)

0%

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The Motley Fool owns shares of Universal Forest Products.. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Earnings estimates provided by Zacks.

At the time this article was published

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