Boise Cascade (BCC): Revisiting Valuation After Earnings Drop but Better-Than-Expected Sales Boost Investor Sentiment

Boise Cascade (BCC) just reported third quarter results that looked mixed on paper, yet the stock pushed higher as investors focused on sales that beat expectations even while adjusted earnings fell sharply from last year.

See our latest analysis for Boise Cascade.

The latest rally fits a broader pattern, with a 12.03% 1 month share price return partly clawing back this year’s steep slide and tempering a 47.37% 1 year total shareholder return decline. Near term momentum is tentatively rebuilding, even as longer term holders remain well ahead on a 5 year total shareholder return basis.

If this earnings driven move has you rethinking your cyclical exposure, it might be a good moment to explore fast growing stocks with high insider ownership as potential new ideas.

With earnings under pressure but the shares still trading at a sizeable discount to analyst targets, is Boise Cascade now an overlooked cyclical value, or are investors already correctly pricing in a muted growth path?

Most Popular Narrative Narrative: 15.2% Undervalued

With Boise Cascade closing at $76.56 against a most widely followed fair value of about $90.33, the narrative frames current pricing as an appealing entry point built on moderate but durable growth assumptions.

The analysts have a consensus price target of $103.667 for Boise Cascade based on their expectations of its future earnings growth, profit margins and other risk factors.

In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $7.0 billion, earnings will come to $285.8 million, and it would be trading on a PE ratio of 15.7x, assuming you use a discount rate of 8.3%.

Read the complete narrative.

Curious how steady mid single digit growth, firmer margins, and a richer future earnings multiple can still argue for upside from here? The full narrative unpacks the exact revenue path, profit lift, and valuation reset that have to line up for this fair value to hold.

Result: Fair Value of $90.33 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that upside case could still quickly unravel if housing demand stays weak and elevated capital spending fails to earn acceptable returns.

Find out about the key risks to this Boise Cascade narrative.

Build Your Own Boise Cascade Narrative

If you see things differently or simply want to dig into the numbers yourself, you can build a custom view in minutes: Do it your way.

A great starting point for your Boise Cascade research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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