West Fraser Timber Co. Ltd. (WFG) outpaces stock market gains: what you need to know

Ois Fraser Timber Co. Ltd. (WFG) closed the last day of trading at $98.92, +1.65% from the previous trading session. The change outpaced the S&P 500’s 1.17% gain on the day. Elsewhere, the Dow gained 0.8%, while the tech-heavy Nasdaq gained 0.18%.

Prior to today’s session, the company’s shares were down 0.01% over the past month. This lagged the Basic Materials sector’s gain of 6.54% and the S&P 500’s gain of 0.88% during this period.

West Fraser Timber Co. Ltd. will look to show strength ahead of its next earnings release. That day, West Fraser Timber Co. Ltd. is expected to report earnings of $7.84 per share, which would represent 12.64% year-over-year growth.

Zacks consensus estimates for the full year for WFG call for earnings of $17.94 per share and revenue of $7.53 billion. These results would represent year-over-year variations of -33.63% and -28.43%, respectively.

It is also important to note recent changes to analyst estimates for West Fraser Timber Co. Ltd. These recent revisions tend to reflect the evolving nature of short-term trading trends. Therefore, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Based on our research, we believe that these estimate revisions are directly related to the team’s close stock movements. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes into account these estimation changes and provides a clear and actionable scoring model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of outperformance verified by external audits, with #1 stocks generating an average annual return of +25% since 1988 The Zacks Consensus EPS estimate has remained flat over the past month. West Fraser Timber Co. Ltd. is currently a Zacks Rank #2 (Buy).

Investors should also note West Fraser Timber Co. Ltd.’s current valuation metrics, including its forward P/E ratio of 5.42. Its industry sports an average Forward P/E of 21.9, so we could conclude that West Fraser Timber Co. Ltd. trades at a comparative discount.

The Agriculture – Products industry is part of the Basic Materials sector. This industry currently has a Zacks industry ranking of 56, which places it in the top 23% of over 250 industries.

The Zacks Industry Ranking assesses the strength of our industry groups by measuring the average Zacks Ranking of individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and more, at Zacks.com.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.