PCL expects US housing starts of 1.1M in 2015, which is +10% YoY, but less than the Wall Street consensus (see chart in #msg-101175278). As a result, PCL probably won’t be raising its dividend during the next few quarters, and the stock may sell off tomorrow.
On a positive note, if the share price remains lower than what PCL believes is warranted by the private-market value of its timberlands, PCL will engage in arbitrage by selling selected timberlands and using the proceeds to repurchase its own shares.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.