WY - Boise Cascade Louisiana-Pacific upgraded to Buy at Truist

2023-06-28 08:28:26 ET

Boise Cascade ( NYSE: BCC ) and Louisiana-Pacific ( NYSE: LPX ) on Wednesday were upgraded to Buy from a previous investment rating of Hold by analysts at Truist Securities. They said the makers of building products are likely to benefit from a stronger U.S. housing market.

“The U.S. housing market, especially single-family starts, is poised for a recovery,” Michael Roxland, analyst at Truist, said in a June 28 report. “Investors will be best positioned in Boise Cascade ( BCC ) and Louisiana-Pacific ( LPX ) given that they are higher beta stocks with greater exposure to single-family home construction.” Beta is a measure of a stock's volatility, or how its price fluctuates in relation to the broader market.

Truist raised its price target on Boise Cascade ( BCC ) to $100 a share from $66 a share previously, based on a price-to-earnings multiple of 11 times to 12 times EPS in calendar year 2024, an enterprise value-to-EBITDA multiple of 7 times to 8 times and a free cash flow yield of 9% to 10%.

The financial-services firm also raised its price target on Louisiana-Pacific ( LPX ) to $82 a share from $49, based on a price-to-earnings multiple of 13 times to 14 times EPS in calendar year 2024 and an enterprise value-to-EBITDA multiple of 10 times to 11 times.

Truist maintained a Hold rating on PotlatchDeltic ( PCH ), Weyerhaeuser ( WY ) and Rayonier ( RYN ).

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