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Universal Forest Products Inc. (UFPI - Analyst Report) is slated to release its financial results for the fourth quarter and fiscal year 2011 on Thursday, February 16. The current Zacks Consensus Estimate for fourth quarter is a loss of 4 cents and 27 cents per share earnings for the fiscal year 2011.

With respect to earnings surprises over the trailing four quarters, Universal Forest outperformed the Zacks Consensus Estimate in one quarter and lagged behind in the other three quarters. The average earnings surprise was a negative 615.68%, implying that the company underperformed the Zacks Consensus Estimate by the same magnitude over the last four quarters.

Third Quarter Highlights

Universal Forest’s earnings per share in the third-quarter 2011 were 29 cents, up from 13 cents in the year-ago quarter but down from the Zacks Consensus Estimate of 31 cents . Top line plummeted 2.4% year over year to $468.9 million. The year-over-year downfall can be primarily attributed to the ongoing weakness in the residential construction and retail building material markets.

Agreement & Magnitude of Estimate Revisions   

As for the analysts providing estimates for the stock in the last 30 days, none revised their estimates for the fourth quarter and fiscal years 2011 and 2012.

Fourth-quarter 2011 estimate remains stable at a loss of 4 cents. Estimate for the fiscal year 2011 is 27 cents and that for 2012 is $1.08. These estimates represent a year-over-year decline of 64.47% and growth of 299.07%, respectively.

Our Take

Outlook seems gloomy for the Michigan-based company, as we still find the housing markets in the US in doldrums.The wretched state of the US housing market poses a major headwind for growth. Moreover, for the quarters ahead, weak consumer spending and management’s expectation of soft customer demand add greatly to our concern.

We currently maintain a Neutral recommendation on the stock.

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