UFP Industries, a prominent player in the Lumber & Wood Production industry, is showcasing promising potential for a rally in December. The company's valuation metrics are compelling, with a PE Ratio of
10.36, significantly lower than the industry average, indicating a potentially undervalued stock. The company's EPS estimate for the current year stands at
8.23, suggesting a robust earnings potential. Moreover, UFP Industries has a solid financial foundation, with a net asset value of
$3.67 billion and net tangible assets of
$2.6 billion. The company's return on assets (ROA) is
0.13, demonstrating a decent profitability relative to its total assets. However, it's worth noting the company's minority interest of
$12.3 million as a loss, which could impact the company's net income. In conclusion, UFP Industries presents a potentially attractive investment opportunity from a valuation viewpoint. The company's low PE ratio, strong earnings potential, and solid asset base position it well for a potential rally in December. However, investors should also consider the company's minority interest loss in their
decision-making process.
Key Takeaways
UFP Industries currently holds $278.1 million in liabilities, with a Debt to Equity (D/E) ratio of 0.13. This ratio may suggest that the company is not leveraging borrowing to its full advantage. The company's current ratio stands at 2.98, indicating that it is sufficiently liquid and capable of meeting its financial obligations when they are due.
Debt can be beneficial for UFP Industries until it encounters difficulties in paying it off, either with new capital or with free cash flow. If the company fails to meet its legal obligations to repay debt, UFP Industries' shareholders could potentially lose their entire investment. However, a more common scenario is when companies like UFP Industries issue additional shares at low prices, diluting the value of existing shares. In such cases, debt can be a superior tool for UFP Industries to invest in growth at high rates of return.
When considering UFP Industries' use of debt, it should always be evaluated in conjunction with cash and equity. Macroaxis provides recommendations on UFP Industries to supplement and cross-verify the current analyst consensus on UFP Industries. Our trade recommendation engine assesses the company's growth potential exclusively from the perspective of an investor's current risk tolerance and investment horizon.
We determine the current worth of Ufp Industries using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Ufp Industries based exclusively on its
fundamental and basic
technical indicators. By analyzing Ufp Industries's
financials, quarterly and monthly indicators, and related drivers such as
dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Ufp Industries's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Ufp Industries. We calculate exposure to Ufp Industries's
market risk, different
technical and
fundamental indicators, relevant financial multiples and ratios, and then
comparing them to Ufp Industries's related companies.
Ufp Industries Investment Alerts
Ufp investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Ufp Industries performance across your portfolios.Please check all
investment alerts for Ufp
Ufp Industries Valuation Ratios as Compared to Competition
Our valuation model uses many indicators to compare Ufp value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Ufp Industries competition to find
correlations between indicators driving the intrinsic value of Ufp.
Ufp Industries Gross Profit
Ufp Industries Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Ufp Industries previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Ufp Industries Gross Profit growth over the last 10 years. Please check Ufp Industries'
gross profit and other
fundamental indicators for more details.
Going after Ufp Financials
The firm reported the previous year's revenue of 9.63
B. Net Income was 704.96
M with profit before overhead, payroll, taxes, and interest of 1.79
B.
| 2016 | 2021 | 2022 | 2023 (projected) |
Consolidated Income | 105.5 M | 704.96 M | 810.71 M | 874.71 M | Direct Expenses | 2.77 B | 7.84 B | 7.05 B | 7.61 B |
Margins Breakdown
Ufp profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Ufp Industries itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Ufp Industries profit margins.
| Operating Margin | 9.58 |
| EBITDA Margin | 0.11 |
| Gross Margin | 0.19 |
| Profit Margin | 0.0893 |
Ufp Industries Revenue Per Employee is increasing over the last 7 years. The previous year's value of Ufp Industries Revenue Per Employee was 469,238. Also, Ufp Industries Net Income Per Employee is increasing over the last 7 years.
"Buy low, sell high" is a well-known investment mantra, and UFP Industries (NASDAQ: UFP) may be an opportunity to put this into practice. With a PE Ratio of 10.36 and a forward dividend yield of 0.0127, the stock appears undervalued compared to its earnings. The company has shown strong
financial health with total stockholder equity standing at a robust
$2.6 billion and a manageable total debt of $278.1 million. Despite a negative net interest income of $15.4 million, UFP Industries has maintained a healthy free cash flow of $657.4 million, providing it with the financial flexibility to navigate market uncertainties. The company's return on assets of 0.13 also indicates efficient use of its resources. As we approach December, the company's solid fundamentals, coupled with a target price of
$115, suggest that UFP Industries could be poised for a rally. Investors seeking exposure to the Lumber & Wood Production industry should consider this potential opportunity. .
Momentum Analysis of Ufp Industries suggests possible reversal in December
The recent skewness indicator for Ufp Industries has dropped to -1.09, suggesting a potential shift in the stock's momentum. This negative skewness often indicates a distribution with a left-leaning tail, where the potential for extreme negative returns is higher. However, in the context of momentum analysis, this could also signal a possible price reversal. Given this, investors might anticipate potential price growth for Ufp Industries in December. As always, it's crucial to consider other market factors and perform a comprehensive analysis before making any investment decisions. As of October 31st, Ufp Industries has a Coefficient Of Variation of (2,343), a variance of 2.62, and a Risk Adjusted Performance of (0.020558). With respect to fundamental indicators, the
technical analysis model allows you to check existing technical drivers of Ufp Industries, as well as the relationship between them. In other words, you can use this information to determine if the company will indeed mirror its model of past prices and volume data, or if the prices will eventually revert. We were able to interpolate data for thirteen technical drivers for Ufp Industries, which can be compared to its competition.
Please validate Ufp Industries' risk adjusted performance, variance, as well as the relationship between the Variance and potential upside to decide if Ufp Industries is priced more or less accurately, providing the market reflects its prevalent price of 96.18 per share. Given that Ufp Industries has an information ratio of 0.0254, we advise you to double-check Ufp Industries's current market performance to make sure the company can sustain itself in the future. In conclusion, Ufp Industries (UFPI) presents a promising investment opportunity as we approach the end of the fiscal year. The company's valuation real value stands at a robust
$107.49, significantly higher than its current market value of $96.18. Furthermore, the analyst overall consensus is a 'Buy', with 3 strong buys and 2 holds out of 5 estimates. The analyst target price estimated value is a promising
$112, suggesting a potential upside from the current price. However, investors should also consider the possible downside price of $92.01. As we move into December, Ufp Industries still appears to have potential for growth, making it a stock to watch closely. .
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Ellen Johnson is a Member of Macroaxis Editorial Board. Ellen covers public companies in North America, focusing primarily on valuation and volatility. Six years of experience in predictive investment analytics and risk management.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Ellen Johnson do not own shares of Ufp Industries. Please refer to our
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