Entering text into the input field will update the search result below

How To Play The Growing Housing Market

Ian Dyer profile picture
Ian Dyer


  • Louisiana-Pacific has a dominant position in the North American home building market.
  • The housing market is on the rise, giving Louisiana-Pacific room to grow.
  • Louisiana-Pacific has seen growth in each of its main segments in the past 4 years.

Louisiana-Pacific Corp. (NYSE:NYSE:LPX) is in the business of manufacturing and selling homebuilding products for new homes and light industrial and commercial buildings, as well as repair and remodeling products. While most of their business is done in North America, they have a growing presence in South America as well.

LPX has a dominant presence in North America. They are the leading producer of Oriented Strand Board (OSB), which is an alternative to plywood that has quietly been taking over the market since 2001 because of its superior durability. In fact, OSB is now used for 70% of all floor, wall and roof sheathing in North America, and again, Louisiana Pacific is at the forefront of this trend. They are also the only producer of OSB in South America, and their South American portion of OSB sales only contributed 6% of their overall revenue. Currently, they have 2 OSB plants in Chile, with a third currently being built, as well as one in Brazil. This is an area where there is plenty of growth potential, being the only producer of a homebuilding staple in an entire continent. LPX is also the leading producer of wood siding in North America, and in 2016, OSB and wood siding contributed 46% and 34% of LPX’s total revenue, respectively.

A significant majority of housing data points to a market that has at least 3-4 years of growth ahead of it. One example that stands out is the high growth rate of new home sales in the USA since 2010.


At the end of June 2010, the total new homes sold was 267,000. This has been on a steady growth trajectory ever since, reaching 610,000 at the same time this year. That’s 128% growth in just 7 years, a clear sign of strong demand for new homes – Louisiana-Pacific’s main line of business. Not only

This article was written by

Ian Dyer profile picture
Duquesne University grad 2014. Currently working for Banyan Hill Publishing,, a financial newsletter provider in Baltimore. My goal is to bring fundamentally undervalued/overvalued stocks to light that do not get enough coverage. Pretty fluent in stocks and options --long and short. Passed Level II CFA exam June 2017

Analyst’s Disclosure: I am/we are long LPX. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (6)

Your should also mention the price of OSB has been strong in particular in relation to plywood. All things being equal this would hopefully lead to expanding margins.
Hello ,, analyze DOOR = think it relates (thks rtcle)
aschmon profile picture
LP is not the leading producer of OSB; Norbord is.
Ian Dyer profile picture
I got that stat from their June 27th Hayward Investor Tour presentation: http://bit.ly/2ulaGQY
takeone1 profile picture
Hi Ian,
leading in MWP,but not in OSB alone.aschmon got you on a technicality,but you are in the right stock......LPX is much more liquid and probably cheaper EPS although I didn't check..thanks for the article and have a good one !!
aschmon profile picture
Your statement that OSB has taken share from plywood because its superior durability is also in error. The durability of OSB is at best comparable to that of plywood. The primary reason for its dominance is manufacturing cost - and therefore - price. Builders can save several hundred dollars per home using OSB for sheathing instead of plywood. I too enjoyed your article!
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.