Stella-Jones Expands into Steel Transmission Structures with Locweld Acquisition

Stella-Jones ( (TSE:SJ) ) has provided an update.

Stella-Jones Inc. announced the acquisition of Locweld Inc., a prominent designer and manufacturer of lattice transmission towers and steel poles, marking its entry into the $5 billion steel transmission structure market. This strategic acquisition, valued at $58 million, is expected to enhance Stella-Jones’ infrastructure offerings and provide new growth opportunities by leveraging its extensive sales and distribution network. The transaction is anticipated to be mutually beneficial, with Locweld gaining from Stella-Jones’ organizational strength, while Stella-Jones plans to invest $15 million to boost Locweld’s output and operational efficiency.

Spark’s Take on TSE:SJ Stock

According to Spark, TipRanks’ AI Analyst, TSE:SJ is a Outperform.

Stella-Jones scores a solid 78, reflecting its robust financial performance, particularly in cash flow generation and revenue growth. The technical indicators suggest a stable stock price with potential short-term fluctuations. The reasonable valuation and consistent dividend growth further support the stock’s attractiveness. While there are minor challenges, such as a decline in utility pole volumes, the overall outlook remains positive due to the company’s strong financial position and strategic initiatives.

To see Spark’s full report on TSE:SJ stock, click here.

More about Stella-Jones

Stella-Jones Inc. is a leading North American manufacturer specializing in infrastructure products essential for electrical distribution and transmission, as well as railway transportation systems. The company supplies treated wood utility poles to major electrical utilities and treated wood railway ties to North America’s railroad operators. Additionally, Stella-Jones supports infrastructure with industrial products such as railway bridge timbers, marine pilings, and coal tar-based products, and distributes premium treated residential lumber to Canadian and American retailers.

Average Trading Volume: 116,515

Technical Sentiment Signal: Hold

Current Market Cap: C$3.75B

For detailed information about SJ stock, go to TipRanks’ Stock Analysis page.