Plum Creek Timber Company Inc.
) crafted a new 52-week high, touching $54.45 during the trading
session on May 20. The closing price of this real estate
investment trust (REIT) represents a solid year-to-date return of
21.9%. The trading volume for the session was over 0.7 million
Despite its strong price appreciation, we believe that any
significant upside to the stock is unlikely in the near term,
given its estimate revisions over the last 30 days.
Factors to Consider
Impressive first-quarter 2013 results - including an earnings
surprise of 9.4% and increasing demand for wood products stemming
from a recovery in the residential construction market have been
the key growth drivers.
Its deal with Drax and
Vulcan Materials Company
) also augurs well for its top line. Moreover, the company
recently announced a 5% hike in its quarterly cash dividend rate,
based on its bullish expectations of persistent growth of
long-term, sustainable cash flow. Yet, the cyclical nature of the
business, cut-throat competition and strict environment policies
are likely to cap its long-term growth potential to some
On Apr 29, Plum Creek reported impressive results for
first-quarter 2013. The company's earnings per share reached 35
cents, comfortably surpassing the Zacks Consensus Estimate of 32
cents and well ahead of the year-ago quarter earnings of 18
The better-than-expected results at this REIT were driven by
increasing demand for wood products stemming from a recovery in
the residential construction market. The company has registered a
decent performance across its segments.
Over the last 30 days, the Zacks Consensus Estimate for 2013
decreased by 1.4% to $1.39 per share. However, for 2014, the
Zacks Consensus Estimate remained unchanged at $1.67 per share.
A number of other REITs also touched 52-week highs this week.
Camden Property Trust
CAMDEN PPTY TR (CPT): Free Stock Analysis
PLUM CREEK TMBR (PCL): Free Stock Analysis
PROLOGIS INC (PLD): Free Stock Analysis
VULCAN MATLS CO (VMC): Free Stock Analysis
To read this article on Zacks.com click here.