The company earns top grades for expanding and improving its product line, and expects to generate sales of $3 billion by 2017, including $250 million from a new product line. This year the company expects revenues of $190 million in new product sales, $100 million from five acquisitions from last year, and is poised to gain from rising demand in commercial construction.
UFPI’s retail building material sales are expected to reap the benefits of increased home improvement spending, while the housing and construction division will profit from new products and increased distribution capacities in the manufactured housing industry, to which it is a component supplier. The company will also gain from housing starts in the residential construction sector, providing that industry continues to expand.
However, rising costs and expenses, customer concentration and dependence on housing markets for its extensive line of wood products exposes it to risks, as does unfavorable movements in foreign currencies. As a result, Zacks has issued a hold rating on the stock.
In today’s trading UFPI closed down -1.24 percent at $59.62. ##
(Photo credit: Universal Forest Products, Inc.)
