Opinions Stephen Takacsy, B. Eng, MBA
Western Forest Products Inc.WEF.TODON'T BUYJun 18, 2015
Stephen Takacsy, B. Eng, MBAStock price when the opinion was issued
As of Jun 04, 2026. Market Open.
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WEF has rallied with interest rates, which help the sector, but is still down 26% for the year and 37% over 52 weeks. Note the dividend was cancelled in November 2023 and none is paid currently. This week WEF announced it would be cutting production. It is still losing money. With its losses and outlook and omitted dividend and small size we would continue to be not interested here.
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Some insider buying. Trades at 0.16x sales, about half as much as CFP or IFP. Money-losing right now. Specialty wood products, typically higher margin and more profitable. But not anymore, related to housing market being slow. Cut dividend to protect balance sheet, so company's now pretty secure.
A great turnaround stock with upside once US interest rates come down and housing activity starts to come back. He's keeping a close eye on it.
Our view remains unchanged. The only recent news was that WEF had engaged in a partnership with a First Nations group where the Group would acquire a 34% interest from WEF in a limited partnership, for $35.9M. There is nothing exciting fundementally and it has small cap risks, so we continue to view it unfavourably.
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It depends tremendously on US housing starts. Things are slowing down a lot in China and US housing starts have slowed a little. There are new import duties into the US based on the price of the lumber. The logistics of getting the logs out of the woods and transported can be a challenge. Dividends are often not sustainable during downturns. Don’t over pay for it and then you have to ride the cycle. He prefers CFF-T.