Potlatch Earnings: Here’s Why Investors are Buying Shares Now

Potlatch Corporation (NYSE:PCH) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are up 1.93%.

Potlatch Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 261.54% to $0.47 in the quarter versus EPS of $0.13 in the year-earlier quarter.

Revenue: Rose 13.32% to $133.2 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Potlatch Corporation reported adjusted EPS income of $0.47 per share. By that measure, the company beat the mean analyst estimate of $0.31. It beat the average revenue estimate of $131.71 million.

Quoting Management: “All of our business segments had very strong operating results in the second quarter despite the weakness in lumber prices and the typical impact of seasonality on our log harvesting activities,” said Michael Covey, chairman and chief executive officer of Potlatch Corporation. “Our Wood Products segment had its best quarter in almost a decade. Lumber prices increased significantly in the first quarter and peaked in April, which benefited us greatly as we had a large number of shipments during this period. These strong pricing gains were somewhat tempered as prices softened in May and June. However, our lumber shipments remained fairly steady during the period so we were able to achieve an excellent level of operating results. Normal seasonal factors, primarily in Idaho, impacted our Resource segment’s second quarter results. However, sustained improved log prices in Idaho partially offset our lower harvest level. Our Real Estate segment completed 65 sales transactions during the second quarter, which is the highest number of quarterly transactions that we have ever experienced,” concluded Mr. Covey.

Key Stats (on next page)…

Revenue decreased 4.34% from $139.25 million in the previous quarter. EPS increased 23.68% from $0.38 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.63 to a profit $0.6. For the current year, the average estimate has moved up from a profit of $1.52 to a profit of $1.57 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)