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What to Expect from Rayonier (RYN) this Earnings Season?

Real estate investment trust ("REIT") Rayonier Inc.RYN is expected to report fourth-quarter and full-year 2016 results on Feb 8, after market close.

Rayonier's third-quarter 2016 pro forma net income per share came in at 33 cents, significantly beating the Zacks Consensus Estimate of 14 cents. In all the trailing four quarters, the company reported positive surprises with an average annual beat of 83.78%.

Let's see how things have shaped up prior to this announcement.

Rayonier Inc. Price and EPS Surprise

Rayonier Inc. Price and EPS Surprise | Rayonier Inc. Quote

Factors to Consider

Rayonier's timberland portfolio is situated in the productive timber-producing regions of the U.S. In addition, the favorable demand-supply dynamics have enhanced the pricing power of the company.

The company constantly attempts to raise its timberland base through disciplined deals. Also, the recent developments in biogenetics & cloning, which are helping in the rapid growth of trees, are expected to drive its growth.

However, Rayonier faces intense competition from different local and national players related to the quality and the price of the timberland. Moreover, timberland business is governed by federal rules and state forestry commissions, which all the timberland REITs have to comply with.

Overall, Rayonier's performance during the quarter was inadequate to win analysts' confidence. As a result, the Zacks Consensus Estimate for fourth quarter 2016 remained unchanged over the last seven days.

Earnings Whispers

Our proven model does not conclusively show that Rayonier will beat on earnings this season. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. However, that is not the case here as you will see below.

You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Zacks ESP : Both the Most Accurate estimate and the Zacks Consensus Estimate currently stand at 3 cents, which translates into an Earnings ESP of 0.00%.

Zacks Rank : Rayonier's Zacks Rank #3, when combined with a 0.00% Earnings ESP makes surprise prediction difficult.

Note that we caution against stocks with Zacks Rank #4 or 5 (Sell-rated) going into earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Here are some REITs that you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Camden Property Trust CPT , expected to release earnings results on Feb 7, has an Earnings ESP of +0.88% and a Zacks Rank #3. You can see the complete list of today's Zacks #1 Rank stocks here .

CubeSmart CUBE , expected to release earnings results on Feb 16, has an Earnings ESP of +2.70% and a Zacks Rank #3.

STAG Industrial, Inc. STAG , expected to release earnings results on Feb 16, has an Earnings ESP of +2.50% and a Zacks Rank #3.

Note: All EPS numbers presented in this write up represent funds from operations (FFO) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

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Rayonier Inc. (RYN): Free Stock Analysis Report

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CubeSmart (CUBE): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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