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What to Expect from Rayonier (RYN) this Earnings Season?

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Real estate investment trust (REIT) Rayonier Inc. (RYN - Free Report) is expected to report first-quarter 2017 results on May 3, after market close.

Currently, the first-quarter 2017 earnings estimate per share is pegged at 9 cents. In the last three months, shares of the company increased 1.2%.

Rayonier’s fourth-quarter 2016 pro forma net income per share came in at 5 cents, beating the Zacks Consensus Estimate of 3 cents. In each of the trailing four quarters, the company delivered positive surprises with an average beat of 93.3%.

Rayonier Inc. Price and EPS Surprise

Rayonier Inc. Price and EPS Surprise | Rayonier Inc. Quote

Let’s see how things are shaping up prior to this announcement.

Factors to Consider

Rayonier’s timberland portfolio is located in the productive timber-producing regions of the U.S. Additionally, the favorable demand-supply dynamics enhanced the pricing power of the company.

The company aims at enhancing its timberland base through disciplined deals. In March, the company entered into three transactions with separate sellers for the purchase of around 95,100 acres of industrial timberlands situated in Florida, Georgia and South Carolina. The total purchase price of these timberlands is around $217 million. Through this move, Rayonier is expanding its presence in the U.S. South coastal Atlantic markets

However, Rayonier faces intense competition from different local and national players related to the quality and the price of the timberland. Moreover, timberland business is governed by federal rules and state forestry commissions, which all the timberland REITs have to comply with.

Earnings Whispers

Our proven model does not conclusively show that Rayonier will beat on earnings this season. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. However, that is not the case here as you will see below.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate currently stand at 9 cents, which translates into an Earnings ESP of 0.00%.

Zacks Rank: Rayonier’s Zacks Rank #2, when combined with a 0.00% Earnings ESP makes surprise prediction difficult.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into earnings announcement, especially when the company is witnessing negative estimate revisions.

Stocks That Warrant a Look

Here are a few stocks in the REIT sector that you may want to consider, as our model shows that they have the right combination of elements to post an earnings beat this quarter.

EPR Properties (EPR - Free Report) , expected to release earnings on May 2, has an Earnings ESP of +0.84% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

STORE Capital Corporation , expected to release first-quarter results on May 4, has an Earnings ESP of +2.44% and a Zacks Rank #3.

Hudson Pacific Properties, Inc. (HPP - Free Report) , expected to release first-quarter results on May 4, has an Earnings ESP of +2.08% and a Zacks Rank #3.

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