#7 - Weyerhauser (NYSE:WY)
The housing market is likely to remain front and center for investors in 2025. Both candidates have different proposals to stimulate this crucial sector. It’s too early to tell what this will look like. However, assuming there will be more homebuilding activity, it may be time to look for lumber stocks like Weyerhauser Co. (NYSE: WY).
This is an example of trying to skate to where the puck is going. If building activity increases, it will be seen in commodity stocks first. Weyerhauser is one of the world’s largest private owners of timberlands. After a sharp move higher in 2021 and 2022, the stock has been trading sideways for the last two years.
That said, analysts predict earnings growth of 68% in the next 12 months. That’s not reflected in the consensus price of $36.33, which is an 11% gain. However, by the time the company starts showing earnings growth, that gap could already be gone.
About Weyerhaeuser
Weyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control approximately 11 million acres of timberlands in the U.S. and manage additional timberlands under long-term licenses in Canada. We manage these timberlands on a sustainable basis in compliance with internationally recognized forestry standards.
Read More - Current Price
- $31.18
- Consensus Rating
- Hold
- Ratings Breakdown
- 3 Buy Ratings, 5 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $36.33 (16.5% Upside)
When you get right down to it, any asset can be a risk-on asset, depending on what's happening in the economy and the markets. And any stock can be a risk-off stock if you intend to hold it over the long term.
But for the purposes of this special presentation, we're defining risk-on as stocks that will likely outperform the market in the next year. That's because markets historically perform worse in the year after the presidential election than they do in an election year. So much for a honeymoon period.
Also, there's no guarantee that a Santa Claus rally will happen this year, but the odds are favorable. The premise behind a Santa Claus rally is that investors want to end the year on a high note.
With that said, many investors will try to position their portfolios to align with where public and monetary policy is likely to go. That may be a mistake.
Stock performance for specific sectors is rarely as good or bad as analysts may suggest. That's why the stocks in this presentation are more evergreen. The catalysts for each one exist no matter who is in the White House or what the composition of Congress will be.
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