RE:RE:When to load up?
Great thoughts. I see what everyone else sees, lumber prices falling and people worried about US mortgage rates at 5% but home builder margins are still great. I don't think they really slow down on building much and I think Americans continue to renovate. The US housing stock is OLD and needs work.
Anyway, anyone who owns this stock already knows the bull case.
What I'm thinking about is share pricing. The low last year in lumber was about $450 in August. At the time, IFP hit a low of $23.70.
I'm assuming Q2 2021 was baked in at that point ($6.45 EPS) so I won't include it. But since then, they earned $1 in each of Q3 and Q4. Will earn around $6.50 again in Q1 and haven't paid out any of it, while picking up EACOM for an absolute steal, investing in the Georgia mills and buying back 4 million shares (6.4% of the float).
If you back that out, it gets to $33 and they're still in a net cash position easily with at least $170m in duties locked away and EACOM paid for. The EV is just $1.8B, which is about $800m after last year's acquisitions.