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Boise Cascade (BCC) Ceases Lumber Production in Chapman
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Boise Cascade Company (BCC - Free Report) intends to indefinitely curtail lumber production in Chapman, Alabama, due to insufficient investments and lower profitability.
Approximately 80 employees, who were being affected by the news, were notified under the Worker Adjustment and Retraining Notification (WARN) Act, with operations set to cease on Jan 28, 2024. However, the plywood operations at the Chapman location are unaffected by the curtailment.
After assessing several factors in the past year, the company has determined that it is not feasible to continue operating at an efficient level. Recognizing the impact on employees and their families due to the shutdown, BCC is communicating about job opportunities within the company and available resources to assist them.
BCC will collaborate with Chapman Lumber customers to manage the transition until the eventual curtailment. The company is focused on expanding its engineered wood products business and providing support to its other manufacturing locations.
Shares of this Zacks Rank #3 (Hold) company dropped 2.11% during the trading session on Nov 28.
Focus on Wood Products
Shares of BCC have increased 64.4% year to date compared with the Zacks Building Products - Wood industry’s 9.6% growth. The company has been benefiting from solid demand across its businesses. Its focus on growth initiatives in distribution and engineered wood products businesses and acquisitions bodes well.
Image Source: Zacks Investment Research
During the third quarter of 2023, BCC's Wood Products reported plywood sales volumes of 390 million feet, up 18.5% year over year. The plywood sales team effectively identified market opportunities, including incremental volumes from the Chapman and Havana mills acquisition.
In the first nine months of 2023, BCC had capital expenditures totaling $99 million. Within this, $31 million was allocated to spending on wood products and $68 million was allocated to the building materials distribution segment. In Wood Products, the company is actively advancing multiyear capacity expansion projects in the Southeast U.S.
The company is optimistic in this regard and anticipates expansions to drive growth. For 2023, the company projects capital expenditures to be in the range of $190-$210 million (up from the prior expectation of $120-$140 million).
Key Picks
Some better-ranked stocks from the Zacks Construction sector are:
The Zacks Consensus Estimate for ROAD’s 2023 sales and earnings per share (EPS) indicates gains of 19.3% and 112.2%, respectively, from the year-ago period’s levels.
EMCOR Group, Inc. (EME - Free Report) carries a Zacks Rank #1. It has a trailing four-quarter earnings surprise of 25%, on average. Shares of EME have risen 36.6% in the past year.
The Zacks Consensus Estimate for EME’s 2023 sales and EPS suggests growth of 12% and 52.8%, respectively, from the year-ago period’s levels.
TopBuild Corp. (BLD - Free Report) sports a Zacks Rank of #2 (Buy). It has a trailing four-quarter earnings surprise of 14.3%, on average. Shares of BLD have surged 89.7% in the past year.
The Zacks Consensus Estimate for BLD’s 2023 sales and EPS indicates gains of 3.7% and 14%, respectively, from the year-ago period’s levels.
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Boise Cascade (BCC) Ceases Lumber Production in Chapman
Boise Cascade Company (BCC - Free Report) intends to indefinitely curtail lumber production in Chapman, Alabama, due to insufficient investments and lower profitability.
Approximately 80 employees, who were being affected by the news, were notified under the Worker Adjustment and Retraining Notification (WARN) Act, with operations set to cease on Jan 28, 2024. However, the plywood operations at the Chapman location are unaffected by the curtailment.
After assessing several factors in the past year, the company has determined that it is not feasible to continue operating at an efficient level. Recognizing the impact on employees and their families due to the shutdown, BCC is communicating about job opportunities within the company and available resources to assist them.
BCC will collaborate with Chapman Lumber customers to manage the transition until the eventual curtailment. The company is focused on expanding its engineered wood products business and providing support to its other manufacturing locations.
Shares of this Zacks Rank #3 (Hold) company dropped 2.11% during the trading session on Nov 28.
Focus on Wood Products
Shares of BCC have increased 64.4% year to date compared with the Zacks Building Products - Wood industry’s 9.6% growth. The company has been benefiting from solid demand across its businesses. Its focus on growth initiatives in distribution and engineered wood products businesses and acquisitions bodes well.
Image Source: Zacks Investment Research
During the third quarter of 2023, BCC's Wood Products reported plywood sales volumes of 390 million feet, up 18.5% year over year. The plywood sales team effectively identified market opportunities, including incremental volumes from the Chapman and Havana mills acquisition.
In the first nine months of 2023, BCC had capital expenditures totaling $99 million. Within this, $31 million was allocated to spending on wood products and $68 million was allocated to the building materials distribution segment. In Wood Products, the company is actively advancing multiyear capacity expansion projects in the Southeast U.S.
The company is optimistic in this regard and anticipates expansions to drive growth. For 2023, the company projects capital expenditures to be in the range of $190-$210 million (up from the prior expectation of $120-$140 million).
Key Picks
Some better-ranked stocks from the Zacks Construction sector are:
Construction Partners, Inc. (ROAD - Free Report) sports a Zacks Rank #1 (Strong Buy). ROAD has a trailing four-quarter earnings surprise of 10.6% on average. Shares of ROAD have gained 47.2% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for ROAD’s 2023 sales and earnings per share (EPS) indicates gains of 19.3% and 112.2%, respectively, from the year-ago period’s levels.
EMCOR Group, Inc. (EME - Free Report) carries a Zacks Rank #1. It has a trailing four-quarter earnings surprise of 25%, on average. Shares of EME have risen 36.6% in the past year.
The Zacks Consensus Estimate for EME’s 2023 sales and EPS suggests growth of 12% and 52.8%, respectively, from the year-ago period’s levels.
TopBuild Corp. (BLD - Free Report) sports a Zacks Rank of #2 (Buy). It has a trailing four-quarter earnings surprise of 14.3%, on average. Shares of BLD have surged 89.7% in the past year.
The Zacks Consensus Estimate for BLD’s 2023 sales and EPS indicates gains of 3.7% and 14%, respectively, from the year-ago period’s levels.