Stella-Jones (TSE:SJ) Issues Quarterly Earnings Results

Stella-Jones (TSE:SJ) posted its quarterly earnings results on Wednesday. The company reported C$1.12 earnings per share (EPS) for the quarter, FiscalAI reports. Stella-Jones had a net margin of 9.65% and a return on equity of 16.67%. The business had revenue of C$791.00 million during the quarter.

Here are the key takeaways from Stella-Jones’ conference call:

• Utility products remain the primary growth driver—Q1 utility sales were CAD 469M (up 12%) with wood pole volumes +12% and recent acquisitions contributing to demand; the company is also on schedule to double steel structure capacity by mid‑2026.
• Management is expanding its North American steel footprint with a new Fayetteville, TN lattice facility (approximately US$500 million investment, ~20,000 tons capacity) targeting commissioning late 2027 and full production by end of 2028, which should support future topline and backlog for U.S. customers.
• Railway ties are broadly stable (Q1 ties sales CAD 198M, down 5% largely from FX); leadership is consolidating the network to target CAD 10–15 million of annualized cost savings starting in 2027, but will incur mostly non‑cash one‑time restructuring charges to implement the plan by end of Q2.
• The balance sheet and cash generation are solid—Q1 sales were CAD 791M, adjusted EBITDA CAD 136M (17.2% margin), operating cash flow CAD 47M, available liquidity CAD 646M and net debt/adjusted EBITDA of 2.6x, providing flexibility to fund expansions and M&A.
• Residential lumber softened in Q1 (sales down 14% to CAD 76M) with declines roughly split between lower volumes and weaker pricing, creating near‑term headwinds despite management’s confidence in the business model and seasonal pickup expectations.

Stella-Jones Trading Down 7.8%

Shares of Stella-Jones stock traded down C$6.49 during trading on Wednesday, reaching C$77.01. 362,284 shares of the stock were exchanged, compared to its average volume of 132,885. The company has a quick ratio of 1.20, a current ratio of 7.40 and a debt-to-equity ratio of 92.30. The stock’s fifty day moving average is C$90.25 and its 200 day moving average is C$88.28. The firm has a market cap of C$4.21 billion, a price-to-earnings ratio of 12.65, a price-to-earnings-growth ratio of 2.40 and a beta of -0.15. Stella-Jones has a 1 year low of C$68.82 and a 1 year high of C$101.31.

Wall Street Analyst Weigh In

A number of research firms have recently weighed in on SJ. TD dropped their target price on shares of Stella-Jones from C$107.00 to C$106.00 and set a “buy” rating for the company in a report on Tuesday. National Bank Financial lowered shares of Stella-Jones from an “outperform” rating to a “hold” rating and dropped their target price for the stock from C$107.00 to C$95.00 in a report on Wednesday, April 8th. Royal Bank Of Canada dropped their target price on shares of Stella-Jones from C$95.00 to C$93.00 and set a “sector perform” rating for the company in a report on Monday, April 13th. Scotiabank dropped their target price on shares of Stella-Jones from C$99.00 to C$97.00 and set a “sector outperform” rating for the company in a report on Tuesday, April 28th. Finally, Canadian Imperial Bank of Commerce dropped their target price on shares of Stella-Jones from C$102.00 to C$96.00 in a report on Wednesday, April 22nd. Five equities research analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the company’s stock. According to MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of C$99.50.

About Stella-Jones

Stella-Jones Inc produces and sells lumber and wood products. The company operates in two segments: Pressure-treated wood, which includes utility poles, railway ties, residential lumber, and industrial products; and Logs & Lumber segment comprises of the sales of logs harvested in the course of the company’s procurement process that is determined to be unsuitable for use as utility poles, it also includes the sale of excess lumber to local home-building markets. The vast majority of its revenue comes from the Pressure-treated wood segment.