With a headline on a major internet news site proclaiming Tuesday morning that 30% of all mortgages in the U.S. are underwater, the problem for Louisiana-Pacific (NYSE:LPX) is pretty obvious. True, building and remodeling activity has not ceased entirely, but there's a lot of bubble-built capacity out there, and not nearly enough activity to let a leading building materials company like Louisiana-Pacific profit. It's not hard to build a model that suggests LPX is significantly undervalued, but with so much of the recovery baked into those years far ahead, the uncertainty is sky-high.
Some Good, Some Bad In the Third Quarter
To be sure, it's not as though activity has ground to a halt. LPX actually reported 9% sales growth for the quarter, with basically flat results in Oriented Strand Board (OSB), 7% growth in siding and 44% growth in engineered wood products. For the most part, a familiar theme still rings true - volume growth is there, but pricing is weak.
Please click the link below for more:
http://stocks.investopedia.com/stock-analysis/2011/Louisiana-Pacific-Still-Bleeding-LPX-WY-UFPI-USG-BLDR-MHK-MAS1109.aspx
No comments:
Post a Comment