West Fraser Timber Co Ltd T.WFG

Preferred Shelf?

[Hanalyst727]

Unless WFG is planning to issue preferred shares, a shelf is just dilutive to shareholders, and conflicts directly with the notion the shares are undervalued as evidenced by the share buyback WFG is currently undertaking and the "higher for longer" bull thesis.

Their earnings and balance sheet are so strong they should only be looking at issuing debt to finance any further takeovers. Issuing long term debt and/or preferred shares to finance takeovers in an inflationary environment is exactly the right thing to do - especially since WFG is clearly capturing the leading edge of the inflation wave a'coming.

The shelf also strongly suggests they wont be paying out these fat earnings as a fat dividend. This is good as is better to get share appreciation then pay tax on dividends.

[Dadsaid2]

You have valid points but l hope your wrong about no dividend. Dividends paid out annually are a nice even income stream many investors count on. Although not as tax friendly as capital gains, if managed properly you can be in a lower tax bracket and pay less over several years. A big capital gain in any given year can bump you up several tax brackets and you pay more on ALL your income, wages

[Glogger1]

I doubt that WFG is interested in CFP- even if Jimmy P has ownership in both companies.  As well, I would be shocked if WFG would increase its pulp exposure where it has not had a great track record. IFP would be a better fit, given its geographical synergies in both BC and the US South. Another target might be Weyco Canada- both OSB and sawmills...

[dosperros]

I don't think it's reasonable to make a bunch of negative inferences on the Shelf Prospectus.  This deal opens doors, commits to nothing, and presupposes none of the concepts you’ve presented here.  It's flexible (e.g., debt, equity, warrants, etc.), fast, and cheap.  I will post more about this shortly as it's an interesting concept, but for now it: It