Stella-Jones Inc. (SJ-T)

Defensive growth at a reasonable price. He's not a trader, but this is the third time he's owned it. Leading NA producer of railway ties (a duopoly) and utility poles (pretty much an oligopoly). Really improved margins. Very strong balance sheet, buying back lots of shares, increasing dividend every year. 

Got hammered recently, as utility pole segment slowed. But there's a huge replacement cycle coming, plus expansion of the electrification grid. Poles will still be the main driver of growth. Great buying opportunity at under 12x earnings. Yield is 2%.

He sold as the technicals and RSI started to deteriorate. Broke down in the summer, has continued to trend downwards. Looks to be support around $65, and around $50. Really struggling right now.

Tough quarter after 3-4 year run of strong demand, with sales and margins increasing. That's taken some confidence away from management, blurred medium-term outlook. Wait for another quarter to see that there's not another leg down.

When things are going well, investors get excited. But when these semi-commodity names face tough times, the multiple can come way down.

Uptrend's just been broken. The last low in early 2024 was just below $80 and was broken, now at $71. Could base at some point, and that would be an OK time to buy. But right now, he wouldn't want to be in it.

Earnings not as good last quarter (recent for share price weakness). Overall - a strong business that is consistently profitable. Consolidation in sector will help. A great example of a cyclical growth company. Would recommend buying on weakness. 

Pulled back based on underlying demand. Businesses are pretty steady-eddy. Infrastructure buildout would help, but questions surround new US administration. Interest rates ticking up means home renos have ticked down. Don't step in here.

Hurricanes (needing lumber replacement) can't be predicted from one period to the next. Investors want to see predictable, recurring revenue and cashflow.

EPS was $1.42, missing estimates of $1.75; revenue of $915M missed estimates of $1.01B. EBITDA of $162M missed estimates by 12%. Lower sales of utility poles was the main reason for the miss. Updated 2025 revenue guidance was also below consensus estimates. Margins were weaker as well. Total sales fell 3.6%. Lumber sales fell 19%. Net income fell 27%. It was a big miss from a usually-reliable company. We would not react here, as the utility issue could be temporary. But certainly not a good quarter. 
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Owns shares, and will continue to own. Has taken partial profits, but has been considering adding more. Well positioned in utility poll business. Strong brand with excellent prospects. Climate change actually good for the business (replacements with disasters). Strong management tea with excellent return on equity. 

Large utility pole business. Strong performance resulting from increased power demand. Unsure of demand for products - would prefer utility providers (not components). 

Does own shares at this time. Likes company overall - building continues in Canada. A good company to watch. 

Likes basic materials in general, the WOOD ETF is performing pretty well. SJ is a special business. Good earnings  growth. He'd be comfortable owning here.

Not a monopoly, but biggest market player in railway ties and utility poles. Behemoth. Earnings beat today, solid results, net income up nicely, increased dividend by 22%. Shares dropped during today's conference call, due to commentary on "customer budget constraints". Still, US and Canada infrastructure spending to come.

Important business now, and will be going forward. Attractive multiple, very high returns, balance sheet quite strong. Likes it.

Very simple business, has done well, the only game in town. Stock's done so well, it's too expensive. He'd need to wait for a pullback. 

US infrastructure demand is lifting shares. Well-run and returns are higher than the market. Trades at a good PE. Buy on dips or even now and hold long term.

Darling in market the past year. Railway sector very strong. Federal government always spending on railways. Would recommend buying for the long term. Current valuation very attractive.