Shares of engineered wood products and plywood company Boise Cascade Company (NYSE: BCC) gapped ahead Tuesday morning to hit their highest level in 27 months following the company releasing the results from the third quarter ended September 30, 2017 that were better than analysts expected.
For the quarter, Boise reported net income of $31.7 million, or 81 cents per share, topping Wall Street forecasts for 69 cents per share. Profits were up 217% from the third quarter last year, when the company reported net income of $9.98 million, or $0.26 per share.
Management further noted that the year earlier quarter benefited from extinguishment of debt that added 15 cents per share to earnings.
Revenue for the quarter came in at $1.23 billion, up 15% from the year prior quarter and $70 million ahead of analyst predictions.
Boise posted gains in both its wood product and building materials distribution segments, with the latter proving larger improvements year-over-year in sales. The wood products segment delivered sales of $366.92 million, up from $340.93 million a year earlier. Profits from this portion of the sales bag surged 104% to $24.03 million from $11.57 million in Q3 2016.
For the building materials distribution segment, the company notched profits of $39.38 million, up from $26.42 million, on sales of $1.05 billion, an 18% improvement from $889.03 million in the year prior quarter.
Boise chief executive Tom Corrick said that distribution benefited from tailwinds from a "strong commodity pricing environment," while the better results in from wood products were driven by strong plywood prices.
The U.S. housing market, primarily new construction on single-family homes that is the main driver for Boise products, has been robust, rising 11% in the third quarter compared to Q3 2016. The unfortunate and catastrophic hurricanes that leveled parts of the South also underscored rising building material prices as demand has spiked.
After closing Monday at $35.30, shares of BCC moved ahead to open trading on Tuesday at $38.35. Shortly into the trading session, shares have an intraday high at $38.85, the highest price for the stock since hitting $39.80 on June 26, 2015.
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