What Happened?
Shares of building products company Boise Cascade Company (NYSE: BCC) rose 1.4% in the morning session after the company reported mixed third-quarter results, with revenue beating expectations while profit declined significantly compared to the previous year. Sales for the quarter came in at $1.67 billion, a 2.7% year-over-year decrease but topping analysts' forecasts by 3.1%. However, GAAP earnings per share (EPS) saw a steep drop to $0.58, missing analyst expectations by 16.3% and falling sharply from $2.33 in the same period a year earlier. The company's profitability was squeezed, with its operating margin falling to 1.9% from 6.8% a year ago, reflecting a more competitive environment and higher costs. Despite the significant earnings miss and contracting margins, investors appeared to focus on the stronger-than-expected sales, sending the stock higher.
After the initial pop the shares cooled down to $70.22, up 2.7% from previous close.
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What Is The Market Telling Us
Boise Cascade’s shares are not very volatile and have only had 8 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was about 24 hours ago when the stock dropped 5.2% on the news that investor concern grew ahead of its third-quarter 2025 earnings announcement, amid lowered financial estimates. Over the previous 90 days, analysts had reduced their full-year 2025 revenue estimates from $6.59 billion to $6.39 billion. During the same period, earnings per share estimates for 2025 also fell from $6.11 to $4.11. This outlook followed a period of financial challenges, including a revenue growth decline of about 3.2% as of June 30, 2025. Adding to the concerns, reports noted the company's net margin and return on equity were below industry averages, pointing to potential difficulties with profitability and cost management.
Boise Cascade is down 40.1% since the beginning of the year, and at $70.22 per share, it is trading 54% below its 52-week high of $152.50 from November 2024. Investors who bought $1,000 worth of Boise Cascade’s shares 5 years ago would now be looking at an investment worth $1,605.
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