West Fraser Timber Co Ltd T.WFG

54% increase in dividend

[lifeisgood1010]

These are once again more signs of a very robust 2021 market.

Last night, Toll Brothers has increased it's quarterly div. by 54%
and Stella Jones just reported their earnings this am.

In their outlook,SJ are pointing to a stronger 2021 for their residential lumber sales.

Some may whine that WFG has not increased their div., that IFP and CFP does not pay one...

I firmly beleive that this will change.They just can't keep so much cash on the balance sheets.

In any events, things look pretty good for long term investors in the lumber industry.

For many this short term correction/consolidation must be very frustrating and it is
understandable but for me it's all about value investing.

And these stocks are by far the cheapest stocks on the TSX.

Here are the outlook from Stella Jones

Excluding the impact of the currency conversion, the Company is projecting sales growth in the low to mid-single digit range in 2021. Utility poles and residential lumber sales are expected to increase in the mid to high-single digit range compared to 2020, while railway ties and industrial product sales are projected to be relatively comparable to those generated in 2020. For utility poles, the sustained healthy replacement maintenance demand, including an increase in value-added fire-resistant wrapped pole sales, is expected to contribute to higher year-over-year sales. For residential lumber, the forecasted increase in sales is driven by the continued strong demand for home improvement projects, current estimates of higher pricing, as well as a projected increase in market reach.

[Frost19]

As part of the Norbord merger, WTF and Norbord were not allowed to increase their dividend or do any special dividends until the merger was fully completed after mid February 2021.  Since the merger completed, WFG has erased 575M of debt from Norbord and issued a buyback program for 5% of outstanding shares. I'm fairly confident when they release first quarter financials for the combined

[lifeisgood1010]

As part of the Norbord merger, WTF and Norbord were not allowed to increase their dividend or do any special dividends until the merger was fully completed after mid February 2021.  You are 100% correct, I fully agree with your comments WFG has started it's NCIB timidly.So far, they have bought back 436,367(Feb. 18th to March 5th.) shares at an avg cost of $82.49 or $35 millions.That

[Frost19]

BAM sold in late February and I'm guessing they are probably done for now. It's not a coincidence a week after BAM finishing selling shares and the price drops from high 90's to low 80's we see insider buying. 

[lifeisgood1010]

I have been traking BAM selling on SEDI Bam has 4 entity were it is a holder of WFG shares. 3 of them are identified(See bellow).The first on top of the list (unnamed) is the one selling. From Feb.17 to Feb.26th, they sold 2,667,411 shares. From March 1st to March 5th, they sold 1,025,016 shares,leaving a balance of 1,730,605 shares. No doubt,BAM selling is appling some pressure on WFG.

[Frost19]

Very interesting, thanks for sharing that.  It would be interesting to see if they sold more this week. 

[lifeisgood1010]

It will be reported on SEDI after friday but the way WFG is trading, i would not be surprised if they are still reducing their position. What's more interesting for me has a shareholder is the amazing wealth creation of these lumber company. The March contract is at $986 The May at $912 (the most active one) The July at $832 Most USA lumber company are at all time high.OK, i get it that

[Frost19]

Yeah I find the valuation strange also.  Q3 and Q4 were strong in 2020 but Q1 and Q2 were bad and will look completely different compared to Q1 and Q2 this year.  WFG is already sitting on a 7 P/E. The earning's are going to explode the next 2 quarters. The buybacks willl elimate shares further pushing the earnings up. If the price is only ~$85 a share in 3-4 months then WFG

[Kojacks88]

I love your positivity Gents, and great explanations but all 3 , IFP/CFP/WFG pushing lower all the while WY/LPX are pushing higher.  Is this economist bearish bull&@## about the potential housing bubble driving these stocks lower or is it insider trading as mentioned? Im in for long Haul since a yr ago but reality needs to recognize true value ...if it is manipulation, with no Divy they

[Nystrom]

Hey Life, you see anymore on this? I saw volume was almost 600k at 3pm Friday...more than the rest of the day combined. 

[lifeisgood1010]

No but i am still tracking BAM selling and there are still reducing their position. They sold 736505 shares for the week and the "Entity" that is selling still has 994,100 shares. So if they want to reduce it to zero it should take them less than 2 weeks. Who knows if the other 3 BAM entity will keep or sell some of their position. Over the past 18 trading sessions,BAM has sold 4,428

[sunshine7]

good work! Any idea if BAM has or is selling a position on IFP? Asking for a friend LOL