What happened
Building products manufacturer Louisiana-Pacific (LPX -0.18%) generated strong results thanks to the booming housing market, and investors are excited. The shares traded up 13% for the week, as of midday Thursday, following Louisiana-Pacific's strong earnings report.
So what
On Nov. 2, Louisiana-Pacific reported third-quarter adjusted earnings of $3.87 per share on revenue of $1.22 billion, topping consensus estimates for $3.42 per share in earnings on revenue of $1.1 billion. Net sales were up 53% year over year, led by a near doubling in revenue from its engineered wood products division, 63% growth in oriented strand board (OSB) sales, and 19% growth in siding.
Image source: Getty Images.
There are some issues the company is facing. For example, OSB saw strong pricing but also higher costs from raw materials, logistics, and mill maintenance. But Louisiana-Pacific was still able to generate strong results.
"As expected, the third quarter saw a significant correction in OSB prices and ongoing headwinds from raw material prices and availability," CEO Brad Southern said in a statement.
Now what
Louisiana-Pacific reiterated its guidance to expect 10% year-over-year revenue growth from siding across the second half and a 25% full-year margin in earnings before interest, taxes, depreciation, and amortization.
The company is facing some of the same challenges as other manufacturers when it comes to supply chain disruptions and raw materials costs, but in a red-hot housing market, end demand for its products is holding up strong.
