Western Forest Products Inc. (WEF.TO)

Likes the lumber plays. Lumber prices have been very firm and US housing has been doing what it has been expected to do. Thinks the US will get up to 1 million housing starts again. At these lumber prices, these companies are generating a ton of cash.

Period of seasonal strength for lumber stocks generally is from around the end of October right through until the middle of April. Chart shows a distinct upward trend, outperforming the market and above its 20 day moving average.

Has lagged some of the others in regards to a housing play. Very cheap on a valuation basis at about 11X earnings. Also pays a dividend. Brookfield, which owns 65%, has been selling off shares which have capped the price a little bit. Great managed company. Thinks the sector is good for another 24 months.

This is doing very well. Relative strength is good and its volume is very strong. He doesn’t see this pulling back much. $2 might be a point where you might want to add some. If it drops below $1.80, you want to get out.

Chart shows a long upward movement with a few flags and then, all of a sudden the stock went a bit parabolic. You have to watch these really strong movers because there could be a pullback. This is normal and expected and don’t panic if you own it. Watch the 200 day moving average and if it breaks and stays below it for too long, then be careful.

Supply in the lumber space is somewhat constrained although there is supply coming from the southern US. Supply from Canada is somewhat constrained because of the pine beetle. This is really benefiting from the falling Cdn$. In general, the housing industry is improving so the demand for lumber is rising slowly.

Caller purchase this at $1.40. With that gain, he would probably trim. However, the prospects are still quite positive, and still fairly valued relative to its peers. One, differentiating factor, versus some of the other or stocks, they sell into the export market more than anybody else. Decent dividend. (See Top Picks)

Ranks very well in his income portfolio as well as his growth portfolio. This is a way to access the US housing market. Sells a lot of raw logs, but also sells some finished product. Earnings growth rate has been increasing as the supply increases in the US. Stock has had a fairly good run lately and thinks there is more to go.

They have all done really well. This is the small cap one so has really good leverage. These stocks are mid way through their run.

Still majority owned by the Brookfield group, who are exiting everything except real estate and maybe some of their renewable energy. With a big shareholder exiting, that puts a little bit of a cap on the price. If it gets up above $2, they may sell more equity. On the other side, this is a stock that benefits hugely from a rebound in housing and demand for lumber. He is likely to sell his warrants after Jan 1st and others may do the same. He would look for a bit of a dip and would only Buy if you have the tolerance for a lot of volatility.

Likes this sector as well as this company. 3^rd quarter earnings were disappointing. Lumber prices have decreased in costs. 3.4% yield.

Anything in the lumber space right now is a pretty good bet, especially if it is a pure lumber play. Not sure that this is a 100% lumber play. If it is, or close to that, this would be a reasonable bet going forward with the US housing market improving. That story might take a little while to play out in 2014. We need to see US housing numbers start to turn around again. Yield of 4.7%. He owns International Forest Products (IFP.A-T) instead.

(Market Call Minute) Great business and they will benefit from a super cycle in the lumber business. Well positioned to take advantage of US housing recovery.

This sector is reasonably strong. Has had a lumpy kind of uptrend. At some point the housing market will run out of steam. He prefers Brookfield Residential Property (BRP-T), luxury housing on the West Coast.

Ranks very well for income and for growth. Business is growing, has been increasing as China and US are having housing booms. Feels it can go higher. It could have a big move.