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Louisiana-Pacific (LPX) Unveils LP NovaCore, Boosts Innovation

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To discover new solutions for continuously evolving its product portfolio, Louisiana-Pacific Corporation (LPX - Free Report) — commonly known as LP Building Solutions (LP) — launched dual-layered LP NovaCore Thermal Insulated Sheathing panels within its LP Structural Solutions portfolio. These panels will minimize thermal bridging and energy loss to make structures more energy-saving and cost-efficient over time.

LP NovaCore Thermal Insulated Sheathing is designed to guard against heat and cold. Its extruded polystyrene (XPS) layer between interior home spaces and the outside world provides continuous insulation with a higher R-value than standard sheathing and does not deteriorate over time. Impressively, this will be one of those insulated panel products that combines XPS foam with an oriented strand board (OSB) substrate.

LP growth and innovation product manager Chris Dall, said, "In the face of evolving building codes that only increase in complexity, LP provides solutions that allow builders to easily meet code requirements without complicated installation processes. Furthermore, as insulation requirements in building codes become stricter, insulated sheathing will become less of a 'nice to have' and more of a 'need to have.'”

Solid Innovation & Transformation Strategy to Drive Growth

LP is an industry leader, especially known for innovation, quality and reliability. Its innovative value-added OSB portfolio, known as LP Structural Solutions, includes LP TechShield Radiant Barrier, LP WeatherLogic Air & Water Barrier, LP Legacy Premium Sub-Flooring, LP FlameBlock Fire-Rated Sheathing and LP TopNotch Sub-Flooring. Louisiana-Pacific continuously identifies new specialty building solutions and markets where it can utilize the core competencies in designing, manufacturing and marketing building products.

LP is gradually transforming a commodity producer into a more stable cash-generative business by increasing revenues and the EBITDA mix. From January 2019 to 2020, Louisiana-Pacific achieved $178 million of cumulative EBITDA from growth and efficiency. It exceeded its three-year target of $165 million for cumulative EBITDA in fourth-quarter 2020. During 2021, adjusted EBITDA increased 150% to $2 billion, primarily on growth in Siding Solutions revenues and higher OSB prices.

This apart, LP continues focusing on three areas, such as increasing the efficiency of mills by improving productivity, run time and quality through overall equipment effectiveness or OEE initiatives; applying best practices to its supply chain and optimizing infrastructure costs.

In a bid to reduce costs, LP lowered the cost structure of its facilities through Lean Six Sigma efforts, the sale or shutdown of underperforming mills and manufacturing facilities as well as investments in technology. Louisiana-Pacific resorts to a strategy of curtailing production at selected facilities to meet customer demand and optimize its portfolio as well as margins.

Zacks Investment Research
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Shares of LP have gained 9.3% in the past year against the Zacks Building Products – Wood industry’s 2.9% fall. Earnings estimates for 2022 have moved up 4.7% in the past seven days. Louisiana-Pacific has a solid surprise history, with its earnings having surpassed the Zacks Consensus Estimate in the trailing eight quarters. This trend reflects bullish analyst sentiments. Its impressive VGM Score of A is a testimony to that.

Zacks Rank & Other Stocks to Consider

LP currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Boise, ID-based Boise Cascade Company (BCC - Free Report) — currently with a Zacks Rank 1— makes wood products and distributes building materials in the United States as well as Canada. Higher commodity wood products pricing and a robust construction activity are consistently aiding it to deliver strong results. Building Materials Distribution and Wood Products segments are gaining strength from strong end-product demand (particularly for EWP) as well as higher commodity product prices. BCC has also been increasing its commodity offerings for a while to instill growth in the existing markets, underserved markets and across its entire national footprint.

BCC has gained 13.4% in the past year. Earnings estimates for 2022 have moved up to $15.07 from $14.02 per share in the past seven days.

Headquartered in Spokane, WA, PotlatchDeltic Corporation (PCH - Free Report) is a leading Real Estate Investment Trust (REIT). PCH’s Timberlands and Wood Products businesses are benefiting from the recent surge in lumber prices. Higher demand for PCH’s products, attributed to positive housing-related fundamentals and continued higher lumber prices, should fuel growth.

PotlatchDeltic sports a Zacks Rank #1 stock, currently. PCH has seen a 12.8% upward estimate revision for 2022 earnings over the past seven days.

Jacksonville, FL-based Rayonier Inc. (RYN - Free Report) is a leading pure-play timberland REIT. With a solid portfolio of timberlands in some of the most productive timber-growing regions of the Southern United States, Pacific Northwest and New Zealand, RYN remains well positioned to capitalize on the robust domestic demand trends, thereby improving the export market conditions and creating a favorable pricing environment. RYN is also focused on adding high-quality timberlands to its portfolio through acquisitions.

The consensus estimate for this Zacks Rank #2 player’s 2022 earnings has witnessed an upward revision of 7.1% in the past 60 days. The stock has gained 22.5% in the past year.