WY - BlueLinx: Synergies Asset Sales And Deleveraging Could Double Share Price In 18 Months
Introduction
BlueLinx (BXC) is a lumber and building materials ("LBM") distributor operating in the Eastern half of the United States. It is primarily a two-step distributor that sells structural products (i.e. plywood, lumber, oriented strand board), and specialty products that involve a higher level of pre-finishing and value-added processing (trusses, roofing, insulation, custom marble, etc.).
Like most distribution businesses, margins are extremely low (sub-5% EBITDA margin), and BlueLinx must generate multiple inventory turns per year to consistently generate a profit. This requires management to minimize delivery times with efficient logistics operations. The company