Update shared on 23 Oct 2025
Fair value Decreased 3.26%Analysts have lowered their price target for West Fraser Timber, citing a reduction from C$122 to C$119 and from $98 to $96. This adjustment comes as a response to recent earnings quality concerns, despite the company’s resilient sector position.
Analyst Commentary
Recent analyst assessments offer a balanced view on West Fraser Timber, with both optimism for the company's positioning and caution due to recent earnings challenges.
Bullish Takeaways- Bullish analysts continue to rate West Fraser Timber as a top pick within its sector. This reflects confidence in the company’s strategic positioning and market resilience.
- Despite recent earnings volatility, West Fraser Timber is viewed as relatively insulated from adverse external factors such as tariffs. This supports a more stable outlook.
- Some see the share price as presenting value, given the company's ability to manage industry headwinds and its track record in sector execution.
- Bearish analysts have reduced price targets in response to "noisy" quarterly reports, particularly noting EBITDA pressure from inventory write-downs.
- Earnings quality concerns have led to a more cautious valuation stance, with analysts citing recent challenges in maintaining metrics consistency.
- There is increased scrutiny on execution, as analysts await clearer signs that the company can sustain improved profitability in upcoming quarters.
Valuation Changes
- Fair Value Estimate: This has decreased modestly, moving from CA$119.39 to CA$115.50 per share.
- Discount Rate: This has been lowered slightly, now at 7.42%, down from 7.57%.
- Revenue Growth: Expected to improve, with forecasts rising from 4.94% to 5.20%.
- Net Profit Margin: This has narrowed marginally, adjusting from 9.70% to 9.63%.
- Future P/E Ratio: Now reduced to 11.59x from a previous 12.19x, reflecting updated earnings expectations.
Disclaimer
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