D.A. Davidson Upgrades Potlatch to "Neutral" (PCH)

D.A. Davidson Upgrades Potlatch to “Neutral” (PCH)


D.A. Davidson reported on Thursday that it has upgraded real estate investment trust (REIT), Potlatch Corporation (PCH).

The firm has raised its rating on PCH from an “Underperform” to “Neutral,” and has maintained a $44 price target. This price target suggests a 9% increase from the stock’s current price of $40.06.

An analyst from the firm commented, “over the past month, shares of Potlatch (and all the Timber REITs) have been hammered due to fears that the Federal Reserve is poised to taper Quantitative Easing, coupled with a sharp decline in lumber and panel prices. With the Potlatch shares now below our $44 price target, we upgrading our recommendation from Underperform to NEUTRAL. Despite the recent downturn in wood markets, we are leaving our estimates unchanged, as our numbers discount declining lumber and panel prices for the remainder of the year. That said, just as the upside exceeded expectations (and was overdone), the prices are falling faster and further than anticipated, and if sustained, estimates could be at risk. At present our FY 2013 and FY 2014 EPS estimates remain static at $1.51 and $1.73, respectively.”

Potlatch shares were down 50 cents, or -1.25% during Thursday morning trading. The stock has been mostly flat YTD.

The Bottom Line
Shares of Potlatch Corporation (PCH) have a 3.10% yield, based on Thursday morning’s price of $40.06.

Potlatch Corporation (PCH) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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