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UFP Industries (UFPI)
NASDAQ:UFPI
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UFP Industries
(NASDAQ:UFPI)
66Neutral
Positive Factors
Investment Opportunities
Profitability has sustained in the low-double-digit EBITDA margin range and the company has identified $1B in investment opportunities to both drive more growth and efficiencies.
Sales Growth
Deckorators building momentum with a ~20% sales increase during the quarter as the Surestone technology continues to attract customers.
Negative Factors
Earnings Performance
UFP Industries posted mixed 4Q24 results this week as EPS fell below Street estimates despite a revenue beat.
Market Outlook
Management’s outlook for 1H25 expects all three segments down slightly as soft demand and the resulting competitive pricing environment awaits a turnaround.
UFP Industries (UFPI) vs. S&P 500 (SPY)
Market Cap
$6.59B
Dividend Yield1.33%
Average Volume (3M)551.28K
Price to Earnings (P/E)16.0
Beta (1Y)1.10
Revenue Growth-7.84%
EPS Growth-17.33%
CountryUS
Employees15,000
SectorBasic Materials
Sector Strength52
IndustryPaper, Lumber & Forest Products
Share Statistics
EPS (TTM)6.72
Shares Outstanding60,824,417
10 Day Avg. Volume554,909
30 Day Avg. Volume551,276
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.98
Price to Cash Flow (P/CF)11.30
P/FCF Ratio11.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$135.67Price Target Upside28.24% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
UFP Industries Business Overview & Revenue Model
Company DescriptionUFP Industries, Inc. (UFPI) is a leading manufacturer and distributor of wood and wood-alternative products, serving multiple industries including retail, construction, and industrial sectors. The company specializes in producing a vast array of products such as pressure-treated lumber, engineered wood components, and outdoor living products. With a focus on innovation and sustainability, UFPI delivers high-quality, customized products to meet the diverse needs of its global customer base.
How the Company Makes MoneyUFP Industries generates revenue through the manufacture and sale of a wide range of wood and wood-alternative products. The company's key revenue streams include retail sales of lumber and building materials to home improvement centers, sales of customized engineered wood products to the construction industry, and industrial packaging solutions. UFPI's earnings are bolstered by its strategic partnerships with major retailers and its ability to adapt to market demands by offering sustainable and innovative product solutions. Additionally, the company's vertically integrated supply chain helps in maintaining cost efficiencies and optimizing production capabilities.
UFP Industries Financial Statement Overview
Summary
UFP Industries exhibits financial stability with strong equity and manageable debt levels. While revenue and profitability have faced recent challenges, the company maintains operational efficiency and a solid cash flow position. The lack of recent balance sheet data limits a full assessment, but historical data shows prudent financial management. The company is well-positioned to manage short-term financial challenges while maintaining its core operational strengths.Income Statement
UFP Industries has shown a decreasing trend in total revenue over the past two years, with a significant decline from 2022 to 2024. The gross profit and net profit margins have also decreased over this period, indicating pressure on profitability. However, the company maintains a solid gross profit margin, which reflects operational efficiency. The EBIT and EBITDA margins have declined since 2022, which could suggest challenges in managing operating costs or pricing pressure. Overall, while profitability is under pressure, the company still maintains reasonable efficiency levels.72
Positive
Balance Sheet
The balance sheet of UFP Industries shows a strong equity position compared to its total assets, indicating financial stability. The debt-to-equity ratio is manageable, reflecting a conservative leverage approach. However, recent data indicates a complete lack of available balance sheet figures post-2023, which limits a comprehensive analysis. Prior data demonstrates a healthy equity ratio, suggesting the company has traditionally operated with a robust capital structure.68
Positive
Cash Flow
UFP Industries has demonstrated strong free cash flow generation relative to net income, maintaining a healthy operating cash flow. The free cash flow growth rate has fluctuated, indicating some volatility in cash generation. Overall, the company has managed its cash flow effectively, supporting operational and capital expenditure needs, though recent declines in free cash flow suggest potential impacts on future liquidity.75
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 6.65B | 7.22B | 9.63B | 8.64B | 5.15B | Gross Profit |
| 1.23B | 1.42B | 1.79B | 1.41B | 800.30M | EBIT |
| 492.24M | 652.30M | 950.18M | 737.55M | 345.83M | EBITDA |
| 701.03M | 815.97M | 1.06B | 835.69M | 418.51M | Net Income Common Stockholders |
| 414.56M | 514.31M | 692.65M | 535.64M | 246.78M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.20B | 1.15B | 595.41M | 323.16M | 460.81M | Total Assets |
| 4.15B | 4.02B | 3.67B | 3.25B | 2.40B | Total Debt |
| 356.92M | 384.30M | 278.10M | 337.28M | 311.71M | Net Debt |
| -814.91M | -734.03M | -281.30M | 50.62M | -124.80M | Total Liabilities |
| 900.95M | 967.58M | 1.07B | 1.23B | 921.74M | Stockholders Equity |
| 3.22B | 3.00B | 2.60B | 2.02B | 1.48B |
| Cash Flow | Free Cash Flow | |||
| 410.30M | 779.51M | 657.44M | 361.31M | 247.29M | Operating Cash Flow |
| 642.57M | 959.89M | 831.57M | 512.48M | 336.48M | Investing Cash Flow |
| -270.75M | -240.16M | -353.94M | -611.19M | -154.72M | Financing Cash Flow |
| -307.12M | -162.86M | -210.21M | -45.01M | 85.22M |
UFP Industries Technical Analysis
Neutral
105.79
Price Trends
109.57
Negative
115.77
Negative
119.25
Negative
Market Momentum
-0.61
Negative
43.98
Neutral
21.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For UFPI, the sentiment is Neutral. The current price of 105.79 is below the 20-day moving average (MA) of 107.24, below the 50-day MA of 109.57, and below the 200-day MA of 119.25, indicating a neutral trend. The MACD of -0.61 indicates Negative momentum. The RSI at 43.98 is Neutral, neither overbought nor oversold. The STOCH value of 21.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for UFPI.
UFP Industries Risk Analysis
UFP Industries disclosed 17 risk factors in its most recent earnings report. UFP Industries reported the most risks in the “Production” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
UFP Industries Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $9.41B | 10.61 | 16.11% | 4.03% | 1.91% | 2.94% | |
76 Outperform | $9.08B | 15.72 | 25.19% | 0.71% | 20.35% | 20.44% | |
66 Neutral | $6.59B | 16.01 | 12.80% | 1.33% | -7.84% | -17.33% | |
64 Neutral | $3.74B | 10.28 | 17.32% | 0.92% | -1.67% | -21.20% | |
62 Neutral | $5.19B | 73.52 | -0.44% | 11.73% | 0.81% | -108.00% | |
57 Neutral | $10.22B | 28.88 | 3.43% | 0.44% | -13.48% | -56.94% | |
47 Neutral | $2.44B | -2.84 | -22.09% | 3.51% | 4.02% | -28.91% |
* Basic Materials Sector Average
Performance Comparison
UFPI
UFP Industries
105.79
-9.84
-8.51%
EMN
Eastman Chemical
76.04
-20.66
-21.37%
HMY
Harmony Gold Mining
16.24
7.04
76.52%
TX
Ternium SA
25.83
-14.07
-35.26%
X
United States Steel
40.87
-1.15
-2.74%
BCC
Boise Cascade
94.68
-50.66
-34.86%
UFP Industries Earnings Call Summary
Earnings Call Date: Feb 17, 2025 | % Change Since: -19.13% | Next Earnings Date: Apr 17, 2025
Earnings Call Sentiment Neutral
UFP Industries showcased strong liquidity and new product development, along with effective M&A activities. However, the company faced significant sales and EBITDA declines due to challenging market conditions and competitive pricing pressures. While there are strategic initiatives in place for future growth, the current environment remains uncertain.Highlights
Strong Liquidity Position
UFP Industries ended 2024 with nearly $1.2 billion in cash and equivalent debt capacity, providing flexibility for growth and M&A opportunities.
Record New Product Sales
New product sales in 2024 totaled $505 million, constituting 7.6% of total sales. The company aims to increase this to 10% over time.
Successful M&A Activity
Acquisition of C&L Wood Products to expand UFP Packaging's PalletOne business unit, reflecting a healthy acquisition pipeline.
Strong Retail Segment Performance
Retail segment sales were flat at $525 million, with a 20% increase in decking sales driven by ShearStone technology.
Positive Return on Invested Capital
Return on invested capital was at 18.3%, nearly double the company's weighted average cost of capital.
Lowlights
Sales Decline
Consolidated sales declined by 4% to $1.46 billion due to a 4% reduction in selling prices and flat unit sales.
Decreased EBITDA
Adjusted EBITDA fell by 28% to $133 million, with an adjusted EBITDA margin decrease to 9.1%.
Competitive Pricing Pressures
Persisting competitive pricing pressures affected margins more than typical trends, especially in packaging and construction segments.
Challenging Market Conditions
Demand and pricing challenges were more pronounced than expected, affecting the packaging and construction businesses.
Company Guidance
During the UFP Industries, Inc. Q4 2024 earnings call, the company reported annual sales of $6.7 billion with an EBITDA of $682.3 million, representing a 10.3% EBITDA margin. Despite a challenging year with a 4% decline in sales to $1.46 billion in Q4, the company maintained a strong balance sheet with nearly $1.2 billion in cash and equivalent debt capacity. The leadership team has implemented cost reductions and facility consolidations, identifying $60 million in structural cost savings to be realized by 2026. For 2024, new product sales reached $505 million, accounting for 7.6% of total sales, with a goal to increase this to 10% over time. Looking ahead, UFP Industries plans to invest significantly in automation, technology, and capacity expansion with a $1 billion multi-year capital plan, and has announced the acquisition of C&L Wood Products to bolster its packaging segment. The company is also focused on returning capital to shareholders through dividends and share repurchases, highlighting its ability to navigate economic cycles while pursuing growth and improving shareholder value.UFP Industries Corporate Events
Business Operations and StrategyFinancial Disclosures
UFP Industries Highlights Growth and Margin Expansion Plans
Positive
Feb 18, 2025
UFP Industries presented its fourth quarter 2024 Investor Relations Presentation, highlighting a focus on driving above-market growth and expanding margins over time. The company has achieved a 30% average annual total shareholder return over the past five years and aims to sustain a 12.5% adjusted EBITDA margin. UFP Industries is committed to innovation, with plans for product and process innovation, and leveraging technology to enhance productivity and efficiency.
Executive/Board Changes
UFP Industries Appoints William D. Schwartz as President
Neutral
Feb 14, 2025
UFP Industries announced that William D. Schwartz has been appointed as the President of the company, effective December 29, 2024, coinciding with the beginning of fiscal 2025. Schwartz was previously named the CEO with the same effective date, and his compensation remains unchanged despite the additional presidential role.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.