Plum Creek Timber Co., Inc. Second Quarter Earnings Preview

S&P 500 (NYSE:SPY) component Plum Creek Timber Co., Inc. (NYSE:PCL) will unveil its latest earnings on Monday, July 25, 2011. Plum Creek Timber Co. Inc. is a real estate investment trust, which owns and manages timberlands and produces lumber products, plywood, medium density fiberboard and related by-products.

Plum Creek Timber Co., Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 29 cents per share, a rise of 38.1% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 31 cents. Between one and three months ago, the average estimate moved down, but has risen from 28 cents during the last month. For the year, analysts are projecting profit of $1.33 per share, no change from last year.

Past Earnings Performance: The company fell short of estimates last quarter after topping forecasts the quarter prior. In the first quarter, it reported net income of 23 cents per share against a mean estimate of 24 cents. Two quarters ago, it beat expectations by one cent with profit of 45 cents.

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Wall St. Revenue Expectations: On average, analysts predict $277.6 million in revenue this quarter, a rise of 7.6% from the year ago quarter. Analysts are forecasting total revenue of $1.16 billion for the year, a decline of 2.5% from last year’s revenue of $1.19 billion.

Analyst Ratings: Analysts seem relatively indifferent about Plum Creek Timber with nine of 12 analysts surveyed maintaining a hold rating.

Key Stats:

The decrease in profit in the first quarter breaks a streak of three consecutive quarters of year-over-year profit increases. Net income fell 56.3% in the first quarter from the year earlier, while the figure rose more than twofold in the fourth quarter of the last fiscal year, 68.4% in the third quarter of the last fiscal year and 9.4% in the second quarter of the last fiscal year.

Over the last four quarters, revenue has increased 1.9% on average year over year. The biggest increase came in the fourth quarter of the last fiscal year, when revenue rose 38% from the year earlier quarter.

The company’s gross margin shrank by 6.6 percentage points in the in the first quarter. Revenue fell 13.2% while cost of sales fell 4% to $190 million from a year earlier.

Competitors to Watch: Potlatch Corporation (NYSE:PCH), Rayonier Inc. (NYSE:RYN), Weyerhaeuser Company (NYSE:WY), Deltic Timber Corporation (NYSE:DEL), Universal Forest Products, Inc. (NASDAQ:UFPI), Louisiana-Pacific Corp. (NYSE:LPX), Pittsburgh & West Virginia Railroad (AMEX:PW), West Fraser Timber Co. Ltd. (NYSE:WFT), and Masisa S.A. (MYSZY).

Stock Price Performance: During June 20, 2011 to July 19, 2011, the stock price had risen $1.55 (3.9%) from $39.33 to $40.88. The stock price saw one of its best stretches over the last year between January 19, 2011 and January 27, 2011 when shares rose for seven-straight days, rising 6.6% (+$2.58) over that span. It saw one of its worst periods between April 4, 2011 and April 13, 2011 when shares fell for eight-straight days, falling 4.5% (-$1.98) over that span. Shares are up $4.17 (+11.4%) year to date.

(Source: Xignite Financials)

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