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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Louisiana-Pacific Corporation (XNYS:LPX) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
LPX
Name:
LOUISIANA-PACIFIC CORPORATION (XNYS:LPX)
Sector:
333.00M
Industry:
Building Products & Equipment
CEO:
Mr. William Southern
Total Employees:
4,800
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 864.85% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF LOUISIANA-PACIFIC CORPORATION(LPX) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND BUILDING PRODUCTS & EQUIPMENT INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
53.28
One Month Price Target:
$53.78
Six Month Price Target :
$56.28
Likely Price in One Year's Time:
Ticker:
$59.29
Likely Trading Range Today Under (Normal Volatility)
$53.05
Price Upper limit ($) :
$53.68
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$49.55
This week:
$44.95
This month :
$36.62
Other Primary facts
Market Cap:
3.92B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
73.87M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
26.57%
-19.56%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$70.55
$62.52
$36.01
$44.04
Medium risk (<10%) entry points
Buy Call
Sell Call
$59.90
Buy Put:
Sell Put:
$58.19
$46.64
$48.37
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
LPX
Sharpe Ratio:
4.10%
Comparison:
LPX, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 64.40% higher than the industry
& ratio is 79.76% higher than the market/S&P 500 average
Average Returns/Yield of
LPX
Daily returns:
0.15%
Weekly returns:
0.76%
Monthly returns:
3.03%
Yearly returns:
21.19%
Comparison of returns:
Average annual returns/yield (last 3 years) is 71.45% above industry average
Classification:
LPX, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.32
Statistical test of Returns:
LPX has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.48%
Weekly Volatility:
7.78%
Monthly Volatility:
15.55%
Yearly Volatility:
53.88%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.56%
Volatility in last five trading days has been -83.78% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.99%
Weekly VaR:
-15.63%
Monthly VaR:
-31.27%
How Much Can the price of
LPX
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-26%
Worst case (decline):
>85%
This translates to price declining to:
$39.47
This translates to price declining to:
$7.99
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
LPX is a 120.69% riskier investment compared to the market/S&P 500 & is 89.07% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 12.63% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
LPX
Beta in relation to market/S&P 500--1.68
Expected beta in 1 year's time:
1.306
Expected beta in 3 year's time:
1.847
Unlevered (debt free) Beta:
1.416
Beta in relation to Nasdaq (XNAS):
1.205
Beta in relation to all global stocks::
1.197
Beta Comparison & Analysis
Beta of competitors/peers::
1.488
Beta is 12.77% higher than peers
Average Industry Beta:
1.393
Beta is 20.48% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
102.03%
Sustainable growth rate is 208.77% above industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.217
Alpha is 155.17% above industry average alpha yield
Alpha is 1380% higher than market/& is unsustainably high
Analysis of Cost of Capital of
LPX
Equity cost of capital:
0.146
Equity cost of capital is 15.40% above industry mean WACC
Unlevered (without debt) cost of capital:
12.36%
Before-tax cost of debt:
3.33%
After-tax cost of debt:
2.63%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.63%
WACC is 26.72% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$65.97
Revenue growth rate per share of (3Y):
2.44
Annual revenue growth rate is 313.22% above the industry average
EPS:
$16.57
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$14.30
Balance sheet equity growth per share: 34.95%
Equity growth rate per share is -29.64% lower than the industry
Debt per share
$5.28
EBITDA per share
$29.04
Valuation Analysis Today of
LPX
P/E Ratio:
3.45
P/E Ratio of Competitors/Peers:
21.03
P/E ratio is -83.62% lower than main peers & is -87.11% lower than the industry
Stock price/value with industry average P/E ratio: $442.80
LPX is -87.97% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $36.18
Present value of the expected future dividends only: $8.96
P/S (Price to Sales ratio):
0.81
Price to sales ratio is -71.59% below the industry mean
P/B (Price to book value ratio):
2.44
Price to free cash flow: 3.73
Price to free cash flow ratio is -92.96% lower than the industry
Net income growth rate (3Y):
430.87%
Net income growth rate is 407.31% higher than the average industry net income growth rate
Dividend Analysis
Dividend payout rate: 1.23%
Dividend yeild: 1.50%
Previous Dividend: $0.22
Previous adjusted dividend: $0.22
Previous Dividend: $0.80
Expected next dividend best case: $0.25
Expected next dividend worst case: $0.19
Average dividend payment (long-term): $0.17
Average dividend increase/decrease (growth rate) % per period: 5.25%
Expected next dividend payment date: 24/08/2022
Expected next dividend record date: 08/10/2022
Expected next dividend declaration date: 27/07/2022
Previous dividend payment date: 26/05/2022
Previous dividend record date: 05/12/2022
Previous dividend declaration date: 28/04/2022
Dividend History:
2022-05-11--$0.22
2021-11-05--$0.18
2021-05-14--$0.16
2022-02-25--$0.22
2021-08-09--$0.18
2021-02-19--$0.16
Dividend growth rate is -72.41% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
24.18%
Net debt to equity ratio:
-14.51%
Debt to assets ratio:
14.61%
Net debt to assets ratio:
-8.76%
Debt-to-asset ratio is -69.22% below industry average
Ability to repay debt:
Interest coverage ratio:
165
Interest coverage ratio is -60.70% less than industry average
Looking forward:
Debt growth rate:
2.06%
Annual debt growth is -66% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.708
Statistical significance of correlation:
LPX has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.604
Stock price is 17.16% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.604
Correlation of price movement with Nasdaq (^IXIC):
0.024
Covariance of price movement with the market:
0.048
Kurtosis
8.326
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.131
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
LPX
Gross Profit Margin Ratio:
182%
Operating Profit Margin Ratio:
41.60%
Operating profit margin is -218.90% lower than the industry
Net Profit Margin Ratio:
182%
Effective Tax Rate:
23.45%
Effective tax rate is 7.07% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
95.54%
Return on equity (ROE) is 329.80% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
57.72%
Return on assets (ROA) is 443.42% higher than the industry
Financial Leverage:
1.2x
Current Ratio:
2.92
Current ratio is -1.25% below industry average
Cash Conversion Cycle (days):
27
Cash conversion cycle is -17.84% below industry average
The remaining useful life of property plant & equipment is: 2.6 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
1.0M
Each employee generates 71% more revenue than industry average revenue per employee
EBITDA generated per employee:
446.9K
Each employee generates 251% more EBITDA than industry average revenue per employee
Profit generated per employee:
321.0K
Each employee generates 306% more net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
69.4K
Each employee generates 646% more free cash flow than industry average revenue per employee
Assets/Capital per employee
276.7K
Each employee generates 646% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
LPX
THE AZEK COMPANY INC. (XNYS:AZEK)
WESCO INTERNATIONAL, INC. (XNYS:WCC)
KBR, INC. (XNYS:KBR)
ADT INC. (XNYS:ADT)
RITCHIE BROS. AUCTIONEERS INCORPORATED (XNYS:RBA)
WATTS WATER TECHNOLOGIES, INC. (XNYS:WTS)
nVent Electric plc (XNYS:NVT)
IAA, INC. (XNYS:IAA)
ASGN Incorporated (XNYS:ASGN)
Current Analyst Ratings
Strong buy�4%
Buy�8%
Hold�25%
Sell�13%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
4.87B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
2.62B
2.25B
-
-
258.00M
-
- 35000.00K
223.00M
-
13.00M
122.00M
2.15B
2.03B
1.54B
2.00B
469.00M
1.54B
Statement of Cash Flow
Date:
Period:
32.00M
Differed Income Tax :
11.00M
Stock Based Compensation :
-
Change in Working Capital :
- 65000.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
- 36000.00K
Net Cash Provided by Operating Activities:
425.00M
Investments in PP&E:
- 92000.00K
Net Acquisitions:
59.00M
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
624.00M
-
624.00M
320.00M
382.00M
15.00M
1.34B
1.18B
19.00M
18.00M
7.00M
8.00M
93.00M
1.33B
2.66B
2.67B
330.00M
-
129.00M
-
129.00M
459.00M
390.00M
102.00M
595.00M
-
1.05B
101.00M
1.60B
- 149000.0K
-
March 31, 2022 at 6:00:00 AM
2.84B
1.61B
2.67B
-
390.00M
- 234000.0K
-
-
- 33000.00K
-
-
- 104000.00K
- 19000.00K
- 14000.00K
- 137000.00K
11.00M
266.00M
637.00M
371.00M
425.00M
- 92000.00K
333.00M
Our Proprietary Portfolio Rating
Our Rating:
A
Price Forecast/Expected Price in Next 5 Years of
LPX
2023
2024
2025
2026
2027
$59.59
$154.08
$171.45
$190.79
$212.30