Housing Market Weakness Could Cause Weyerhaeuser to Close Plants

Lumber and paper company Weyerhaeuser said in a US regulatory filing on Monday that the market for wood products was not performing as expected, and would cause closures, curtailments, and restricted operations in its wood product factories. Last quarter, the wood-product business, which accounts for 36% of the company's revenue, lost $123 million and caused company sales to slip 11% from a year ago. The US housing market has severely hurt prices and created challenging market conditions. The filing also noted the markets for "cellulose fibers and containerboard, packaging and recycling segments continue to improve." The company has considered selling these assets, after receiving pressure to do so from large institutional shareholders for some time. Weyerhaeuser stock closed down 2.2% to $67.30 on Friday.

Sources: Wall Street Journal, Reuters
Commentary: 11th Hour Panic and Using More Lumber • Paper and Forest Product Sector Stock Picks
Stocks/ETFs to watch: WY. Competitors: IP, LPX. ETFs: XLB, UYM

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