Critical Comparison: Weyerhaeuser (NYSE:WY) vs. Boise Cascade (NYSE:BCC)

Weyerhaeuser (NYSE:WY) and Boise Cascade (NYSE:BCC) are both construction companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, dividends, earnings and profitability.

Earnings & Valuation

This table compares Weyerhaeuser and Boise Cascade”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Weyerhaeuser	$7.12 billion	2.62	$396.00 million	$0.38	68.00
Boise Cascade	$6.56 billion	0.49	$376.35 million	$6.81	12.66

Weyerhaeuser has higher revenue and earnings than Boise Cascade. Boise Cascade is trading at a lower price-to-earnings ratio than Weyerhaeuser, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Weyerhaeuser and Boise Cascade’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Weyerhaeuser	3.97%	2.95%	1.73%
Boise Cascade	4.00%	12.26%	7.64%

Analyst Ratings

This is a breakdown of recent ratings for Weyerhaeuser and Boise Cascade, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Weyerhaeuser	1	1	6	1	2.78
Boise Cascade	0	3	4	0	2.57

Weyerhaeuser currently has a consensus price target of $32.8750, suggesting a potential upside of 27.23%. Boise Cascade has a consensus price target of $112.8333, suggesting a potential upside of 30.84%. Given Boise Cascade’s higher possible upside, analysts plainly believe Boise Cascade is more favorable than Weyerhaeuser.

Insider & Institutional Ownership

83.0% of Weyerhaeuser shares are held by institutional investors. Comparatively, 96.2% of Boise Cascade shares are held by institutional investors. 0.3% of Weyerhaeuser shares are held by insiders. Comparatively, 1.0% of Boise Cascade shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Weyerhaeuser pays an annual dividend of $0.84 per share and has a dividend yield of 3.3%. Boise Cascade pays an annual dividend of $0.88 per share and has a dividend yield of 1.0%. Weyerhaeuser pays out 221.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Boise Cascade pays out 12.9% of its earnings in the form of a dividend. Weyerhaeuser has increased its dividend for 3 consecutive years and Boise Cascade has increased its dividend for 6 consecutive years.

Volatility & Risk

Weyerhaeuser has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500. Comparatively, Boise Cascade has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.

Summary

Boise Cascade beats Weyerhaeuser on 10 of the 18 factors compared between the two stocks.

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. We are also one of the largest manufacturers of wood products in North America. Our company is a real estate investment trust. In 2022, we generated $10.2 billion in net sales and employed approximately 9,200 people who serve customers worldwide. Our common stock trades on the New York Stock Exchange under the symbol WY.

About Boise Cascade

Boise Cascade Company engages in manufacture of wood products and distribution of building materials in the United States and Canada. It operates through two segments, Wood Products and Building Materials Distribution. The Wood Products segment manufactures laminated veneer lumber and laminated beams used in headers and beams; I-joists for residential and commercial flooring and roofing systems, and other structural applications; structural, appearance, and industrial plywood panels; and ponderosa pine shop lumber and appearance grade boards. The Building Materials Distribution segment distributes a line of building materials, including oriented strand boards, plywood, and lumber; general line items, such as siding, composite decking, doors, metal products, insulation, and roofing; and engineered wood products. It markets and sells its products to dealers, home improvement centers, wholesalers, specialty distributors, and industrial converters for use in the construction of new residential housing, repair-and-remodeling of existing housing, construction of light industrial and commercial buildings, and other industrial applications. Boise Cascade Company was incorporated in 2004 and is headquartered in Boise, Idaho.