Stella-Jones Inc (TSE:SJ)
TSX:SJ
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Stella-Jones
(TSX:SJ)
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Rating:67Neutral
Price Target:
C$89.00
▲(6.32% Upside)
Action:Reiterated
Date:05/09/26
The score is driven primarily by strong financial performance (solid growth, profitability, and cash generation), partially offset by weak technicals (price below key moving averages with bearish momentum). Valuation is supportive but not compelling given the P/E and modest dividend yield.
Positive Factors
Free Cash Flow Strength
Sustained strong trailing‑12‑month operating and free cash flow provides durable financial flexibility, funding capex, maintenance and shareholder returns without reliance on external financing. Over months this supports reinvestment and de‑leveraging capacity even in cyclical demand.
Negative Factors
Margin Compression
Sustained margin softening reduces intrinsic earnings power and can erode free cash flow over time if not reversed. For a manufacturer reliant on input costs and pricing, this trend limits reinvestment, shareholder returns and the ability to build reserves during normal demand cycles.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow Strength
Sustained strong trailing‑12‑month operating and free cash flow provides durable financial flexibility, funding capex, maintenance and shareholder returns without reliance on external financing. Over months this supports reinvestment and de‑leveraging capacity even in cyclical demand.
Read all positive factors
Stella-Jones (SJ) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$4.38B
Dividend Yield1.43%
Average Volume (3M)95.11K
Price to Earnings (P/E)14.4
Beta (1Y)0.36
Revenue Growth1.24%
EPS Growth-7.57%
CountryCA
Employees3,000
SectorBasic Materials
Sector Strength58
IndustryPaper, Lumber & Forest Products
Share Statistics
EPS (TTM)5.51
Shares Outstanding54,605,793
10 Day Avg. Volume96,619
30 Day Avg. Volume95,114
Financial Highlights & Ratios
PEG Ratio1.84
Price to Book (P/B)2.31
Price to Sales (P/S)1.35
P/FCF Ratio10.37
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$94.83Price Target Upside13.29% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
EPS Forecast (FY)5.83
Revenue Forecast (FY)C$3.64B
Stella-Jones Business Overview & Revenue Model
Company Description
Stella-Jones Inc., established in 1992 and headquartered in Saint-Laurent, Canada, is a key manufacturer and distributor of pressure-treated wood products throughout Canada and the United States. The company supplies railway ties and timbers to ra...
How the Company Makes Money
Stella-Jones makes money by manufacturing, treating, and selling wood products—primarily railway ties and utility poles—to customers that require long-life, pressure-treated materials for critical infrastructure. Revenue is generated from product ...
Stella-Jones Earnings Call Summary
Earnings Call Date:Nov 05, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Neutral
The earnings call reflected a balanced view with strong sales growth, strategic acquisitions, and robust cash generation being offset by challenges in railway ties volumes and spot market pricing. The company remains optimistic about its strategic initiatives and long-term growth trajectory.Positive Updates
Organic Sales Growth
The company reported a 2% organic sales growth compared to the prior year quarter, driven by higher infrastructure volumes, primarily for utility poles.
Negative Updates
Railway Ties Volume Decline
Railway ties sales were impacted by a Class 1 customer treating their railway ties internally, resulting in a mid-single-digit year-over-year decline expectation.
Read all updates
Q3-2025 Updates
Positive
Negative
Organic Sales Growth
The company reported a 2% organic sales growth compared to the prior year quarter, driven by higher infrastructure volumes, primarily for utility poles.
Read all positive updates
Company Guidance
During Stella-Jones' third quarter 2025 earnings call, the company provided detailed guidance and metrics reflecting its financial health and strategic initiatives. Organic sales growth was reported at 2%, boosted by higher infrastructure volumes, with total sales up 5% year-over-year due to acquisitions. The utility poles segment saw sales increase to $480 million, a rise from $448 million in 2024. However, spot market pricing pressures led to a 3% decline in utility pole pricing. The railway ties segment showed a slight increase in sales to $211 million, driven by improved pricing, while residential lumber sales rose to $201 million due to higher inventory costs. The company maintained strong EBITDA margins of 17.8%, with an EBITDA of $171 million. Cash flows from operations exceeded $500 million over the past 12 months, supporting strategic investments and shareholder returns, including a new normal course issuer bid for share buybacks. The company also highlighted its ongoing commitment to ESG initiatives, such as reducing greenhouse gas emissions. Looking ahead, Stella-Jones expects utility pole sales growth in the low-single-digit range for 2025 and is focusing on strategic acquisitions like Brooks to enhance its product offerings and market presence.Stella-Jones Financial Statement Overview
Summary
Income Statement
83
Very Positive
Balance Sheet
72
Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.51B | 3.49B | 3.47B | 3.32B | 3.06B | 2.75B |
| Gross Profit | 678.00M | 689.00M | 724.00M | 688.00M | 524.00M | 456.00M |
| EBITDA | 617.00M | 637.00M | 633.00M | 608.00M | 448.00M | 400.00M |
| Net Income | 304.00M | 337.00M | 319.00M | 326.00M | 241.00M | 227.00M |
Balance Sheet | ||||||
| Total Assets | 4.29B | 4.12B | 4.10B | 3.71B | 3.07B | 2.67B |
| Cash, Cash Equivalents and Short-Term Investments | 94.00M | 44.00M | 50.00M | 0.00 | -167.00M | -144.00M |
| Total Debt | 1.69B | 1.88B | 1.70B | 1.61B | 1.11B | 878.00M |
| Total Liabilities | 2.19B | 2.08B | 2.16B | 2.06B | 1.52B | 1.22B |
| Stockholders Equity | 2.10B | 2.04B | 1.94B | 1.65B | 1.56B | 1.45B |
Cash Flow | ||||||
| Free Cash Flow | 523.00M | 454.00M | 265.00M | -58.00M | 147.00M | 187.00M |
| Operating Cash Flow | 620.00M | 557.00M | 408.00M | 107.00M | 255.00M | 251.00M |
| Investing Cash Flow | -330.00M | -337.00M | -137.00M | -258.00M | -154.00M | -193.00M |
| Financing Cash Flow | -286.00M | -226.00M | -221.00M | 151.00M | -101.00M | -58.00M |
Stella-Jones Technical Analysis
Neutral
83.71
Price Trends
81.28
Positive
87.35
Negative
84.26
Negative
Market Momentum
-0.12
Negative
61.80
Neutral
96.52
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SJ, the sentiment is Neutral. The current price of 83.71 is above the 20-day moving average (MA) of 75.17, above the 50-day MA of 81.28, and below the 200-day MA of 84.26, indicating a neutral trend. The MACD of -0.12 indicates Negative momentum. The RSI at 61.80 is Neutral, neither overbought nor oversold. The STOCH value of 96.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:SJ.
Stella-Jones Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | C$4.38B | 14.39 | 14.85% | 1.43% | 1.24% | -7.57% | |
67 Neutral | C$322.12M | 6.53 | 13.97% | 7.35% | -23.77% | 142.01% | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
54 Neutral | C$1.57B | -1.83 | -30.75% | ― | -0.13% | -33.42% | |
51 Neutral | C$169.88M | -1.50 | -22.88% | ― | -15.14% | -1199.88% | |
47 Neutral | C$7.08B | -3.50 | -23.07% | 2.21% | -11.68% | -64044.58% | |
47 Neutral | C$685.29M | -1.84 | -28.72% | ― | -7.89% | -26.09% |
* Basic Materials Sector Average
TSE:SJ
Stella-Jones
80.12
2.51
3.23%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.