Tue, Nov. 17, 6:49 PM
- Plum Creek Timber (NYSE:PCL) shareholders are set to enjoy a dividend hike of up to 13% upon its merger with Weyerhaeuser (NYSE:WY), part of the motive behind RBC analyst Paul Quinn's upgrade of PCL shares to Outperform from Sector Perform with a $56 stock price target, raised from $42.
- The combined company will continue to pay WY’s $1.24/share annual dividend, while PCL shareholders receive $1.76/share; given that PCL shareholders will receive 1.6 WY shares per PCL share, the equivalent dividend payments will rise to $1.98, a 13% improvement, Quinn explains.
- Quinn believes the combo's synergies, increased liquidity and broadened timberlands diversity should make WY-PCL the investment choice for any investor looking for exposure to timber markets.
Mon, Nov. 9, 9:06 AM
- The two companies are currently holding a joint conference call to discuss the deal with investors and analysts.
- Webcast and presentation slides
- WY -5.35% to $28.84 and PCL +13.6% to $45.75 premarket.
- The deal is expected to close late in Q1 or early in Q2, and the merged company's 13-member board will have eight from WY and five from PCL. The $1.24 per share annual dividend is maintained for WY holders, but represents a 13% increase for PCL owners. FAD per share accretion is expected in year one.
- The merger is not contingent on WY's ongoing strategic alternatives review of its cellulose fibers business. Options are still business as usual, or a sale/spin of the unit.
- Previously: Weyerhaeuser acquiring Plum Creek to make $23B timber giant (Nov. 8)
Sun, Nov. 8, 4:10 PM
- Weyerhaeuser (NYSE:WY) will acquire Plum Creek (NYSE:PCL) in a merger that will create a Northwest U.S. timber giant.
- Plum Creek has a $7B market cap. The result will be a $23B timber REIT carrying more than 13M acres of land. Both boards have unanimously approved the deal.
- It's an all-stock transaction; for every Plum Creek share, holders will receive 1.6 shares of Weyerhaeuser. After the deal, the combined company will execute a $2.5B share repurchase which will effectively make the deal look like a 70% stock/30% cash deal.
- With Weyerhaeuser the surviving company, its Doyle Simons will be president and CEO, while Plum Creek's Rick Holley will become non-executive chairman.
- The two companies had a combined 2014 EBITDA of $2.2B. They say that annual cost synergies will come to $100M. Keeping Weyerhaeuser's current annual dividend of $1.24/share will represent a 13% increase to the dividend currently received by Plum Creek shareholders.
Fri, Oct. 30, 4:24 AM
Thu, Oct. 29, 5:30 PM| Thu, Oct. 29, 5:30 PM | 19 Comments
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Fri, May 22, 5:47 PM
Tue, May 12, 10:47 AM
- An improving job market and loosening lending standards are set to unleash pent-up demand and lead to the best decade for residential homebuilding since the 1970s, says Morningstar's Daniel Rohr.
- The prediction may seem "outrageous" considering the lame recovery of the past few years, but it's that lame recovery which makes the outlook so strong, says Rohr. He sees an average of 1.6M annual starts through 2024. In the post-war era, only the 1970s - with a 1.75M average - was better.
- Top picks include lumber company Weyerhaeuser (NYSE:WY), steelmaker Nucor (NYSE:NUE), and homebuilder NVR (NYSE:NVR), and the related mortgage boom will be of benefit to lenders like U.S. Bancorp (NYSE:USB), BB&T (NYSE:BBT), and Fifth Third (NASDAQ:FITB).
Fri, May 1, 7:38 AM
- Q1 earnings from continuing operations before special items of $99M or $0.19 per share vs. $143M and $0.24 one year ago. Float of 527M shares falls from 589M.
- $250M of shares repurchased during quarter; 65% of authorization is complete.
- Timberlands pretax earnings of $162M vs. $143M a year ago, on sales of $351M vs. $359M. Lower earnings are expected in Q2 thanks to a decrease in realizations for Western logs and lower earnings from the sale of nonstrategic properties.
- Wood Products pretax earnings of $62M vs. $56M a year ago, on sales of $923M vs. $947M. Company expects significantly higher earnings in Q2, thanks to seasonally higher sales and realizations.
- Cellulose Fibers pretax earnings of $33M vs. $87M a year ago, on sales of $447M vs. $482M. Lower earnings are expected in Q2 thanks to lower average pulp sales realizations and higher costs.
- Earnings call at 10 ET
- Previously: Weyerhaeuser misses by $0.06, misses on revenue (May 1)
- WY flat premarket
Fri, May 1, 4:51 AM
Thu, Apr. 30, 5:30 PM
Fri, Feb. 13, 4:19 PM
Fri, Feb. 6, 8:27 PM
- U.S. West Coast ports will close this weekend -- 29 of them -- as a nine-month labor slowdown drags on.
- Loading and unloading is suspended, though the Pacific Maritime Association says some activities will continue.
- "In light of ongoing union slowdowns up and down the coast which have brought the ports almost to a standstill, PMA member companies finally have concluded that they will no longer continue to pay workers premium pay for diminished productivity," the PMA says.
- For the union's part: "Closing down the ports over the weekend is a crazy way to do business because it’s hurting customers and adding to the already serious congestion crisis that the industry has created."
- It's the first time contract talks have led to a West Coast shutdown since 2002.
- A 10-day lockout back then cost the U.S. economy $1B/day; the same thing today likely costs over $2B/day.
- Companies noting the impact of a slowdown/shutdown in their reports, or which would likely be affected: (WY -1.8%); (TSN -0.6%); (UNP -0.8%); (LULU -1.3%); (WMT +0.1%); (ANN +3.2%); (M); (KSS +2.3%); (RL -2.1%); (CRI +2.2%)
Weyerhaeuser Co is a real estate investment trust. It is a private owner of timberlands. The Company owns or controls nearly seven million acres of timberlands in the U.S., and manages additional timberlands under long-term licenses in Canada.
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