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Weyerhaeuser (WY) Expands Into Texas With AZEK Products Portfolio

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·3 min read
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Weyerhaeuser Company WY has expanded its partnership with The AZEK Company AZEK in Texas, whereby the former will expand its offerings and introduce AZEK Exteriors and TimberTech premium outdoor living products to Texas customers.

Through its Dallas and Houston distribution units, Weyerhaeuser will offer a wide range of low-maintenance and environmentally supportable TimberTech Outdoor Living products and AZEK Exteriors products throughout the Texas market with AZEK Building Products. With this partnership, Weyerhaeuser and AZEK Building Products will partner across 13 distribution centers throughout the United States.

TimberTech Outdoor Living and AZEK Exteriors offer customers a range of high-performance products that are alternatives to wood with classy, natural aesthetics. Products come in a range of styles and are all supported by industry-leading warranties.

A Look at Distribution Business

Weyerhaeuser’s business segments — Timberlands, Real Estate, Energy and Natural Resources, and Wood Products — are categorized primarily on the basis of products and services. Now, the Wood Products unit is engaged in structural lumber, oriented strand board (OSB), engineered wood products and building materials distribution.

Wood products earnings and adjusted EBITDA improved almost $0.5 billion sequentially for second-quarter 2021. The segment’s lumber, OSB and distribution businesses established new quarterly adjusted EBITDA records in the quarter. These exceptional results were delivered via navigating the ongoing challenges associated with transportation and resin availability in the quarter.

Precisely, the segment’s distribution business’ adjusted EBITDA grew $36 million sequentially, reflecting a 92% improvement, given higher sales volumes for most products and improved margins.

Share Price Performance

Zacks Investment Research
Zacks Investment Research

Image Source: Zacks Investment Research

Shares of Weyerhaeuser have underperformed the Zacks Building Products - Wood industry so far this year. Nonetheless, despite rapidly changing market conditions owing to the COVID-19 pandemic outbreak, Weyerhaeuser’s operational excellence initiatives, solid momentum in U.S. housing, and solid repair and remodel demand bode well. The company delivered strong performance across businesses in second-quarter 2021 despite the uncertain lumber and resin market as well as rising transportation costs. It continues to focus on operational excellence and expects another $50-$75 million improvement across businesses in 2021.

Zacks Rank & Key Picks

Weyerhaeuser currently carries a Zacks Rank #3 (Hold).

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

Some better-ranked stocks in the broader Construction space include Caesarstone Ltd. CSTE and Louisiana-Pacific Corporation LPX. While Caesarstone currently sports a Zacks Rank #1, Louisiana-Pacific carry a Zacks Rank #2 (Buy).

Caesarstone and Louisiana-Pacific’s earnings are likely to increase 114.6% and 215.3%, respectively, this year.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Weyerhaeuser Company (WY) : Free Stock Analysis Report

LouisianaPacific Corporation (LPX) : Free Stock Analysis Report

Caesarstone Ltd. (CSTE) : Free Stock Analysis Report

The AZEK Company Inc. (AZEK) : Free Stock Analysis Report

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Zacks Investment Research