Greendale 87 said:
Been watching LPX as well. No strong opinion on its technicals, but I think CPI/Inflation/interest rate worries will eventually impact housing which really hits them. Additionally, large part of lumber price spike was driven by mill capacity constraints, which are getting less severe and will self-correct in months - it will not take years. We still have more trees than we know what to do with.
LPX will be rolling in cash for a few more quarters, but that is already priced into the stock. It may be only downside from here. Not saying it's a "crash" candidate, but recent glory days may be over.
Thanks, I've been digging more on it too watching the pricing.
Looks like lumber futures are down 4.30% today, but on very light volume (3 contracts, when daily average is 182 over the past year. Just charting but open interest on the lumber futures is dropping substantially, but that looks to be on a two month cycle and we're at the end of the cycle. No guarantee but it looks like things should pick back up soon?
I read an analyst report earlier this week that they expected prices to remain high through the end of the summer, then taper as more supply and milling came back fully.
Going back the last three years May looks like a down month seasonally as well, but things pick up in June.