Investment Thesis
Weyerhaeuser demonstrates solid operational cash generation with $450M FCF, but fundamental growth has stalled with declining revenue (-3.1% YoY) and flat net income despite higher volumes, indicating margin compression in core timber operations. While balance sheet leverage remains manageable at 0.59x debt/equity, the modest 2.7x interest coverage and weak 3.4% ROE suggest limited returns on shareholder capital amid cyclical industry headwinds.
WY Strengths
- Strong free cash flow generation of $450M with 6.5% FCF margin supports dividend sustainability
- Conservative leverage at 0.59x debt/equity with adequate interest coverage provides financial flexibility
- Solid operational efficiency with $562M operating cash flow despite revenue contraction
- Substantial asset base of $16.6B with $9.4B equity cushion for REIT reinvestment
WY Risks
- Revenue decline of 3.1% YoY signals deteriorating market conditions or pricing pressure in timber/real estate segments
- Net income flat despite operations indicates margin erosion and operational challenges being masked
- Low profitability ratios (4.7% net margin, 3.4% ROE) suggest limited value creation for shareholders
- Quick ratio of 0.83x indicates potential near-term liquidity constraints if operational cash flow deteriorates
- High insider selling activity (19 Form 4 filings) may signal management concerns about fundamentals
Key Metrics to Watch
- Revenue trend stabilization and margin recovery in next 2-3 quarters
- Operating cash flow sustainability and capital expenditure levels relative to FCF
- Debt/equity ratio tracking and interest coverage maintenance above 2.5x minimum
- Operating margin expansion potential as timber prices and real estate markets recover
WY Financial Metrics
WY Profitability Ratios
WY Balance Sheet & Liquidity
WY 5-Year Financial Trend
5-Year Trend Summary: WEYERHAEUSER CO's revenue has declined by 25% over the 5-year period, indicating business contraction. The most recent EPS of $1.15 reflects profitable operations.
WY Growth Metrics (YoY)
WY Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $1.7B | $28.0M | $0.04 |
| Q2 2025 | $1.9B | $87.0M | $0.12 |
| Q1 2025 | $1.8B | $83.0M | $0.11 |
| Q3 2024 | $1.7B | $28.0M | $0.04 |
| Q2 2024 | $1.9B | $173.0M | $0.24 |
| Q1 2024 | $1.8B | $114.0M | $0.16 |
| Q3 2023 | $2.0B | $239.0M | $0.33 |
| Q2 2023 | $2.0B | $230.0M | $0.31 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
WY Capital Allocation
WY SEC Filings
Access official SEC EDGAR filings for WEYERHAEUSER CO (CIK: 0000106535)