Value
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 0.2 |
| P/S | 8.9 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 4.9 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 25.6x
- ▸PEG: 0.09
LPX · Why this verdict
Why Louisiana-Pacific (LPX) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score4.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Louisiana-Pacific is a building-products maker with declining revenue (-12%), a red-flag cash conversion and no competitive moat. The price is only 3.5% below the analyst target against 15.0% downside to the stop, so reward does not compensate for the risk.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Revenue is shrinking: the data shows a 12% decline, which leaves growth ranked at the bottom of its industry peers. Growth breakdown | Revenue should return to flat or positive year-over-year growth for the thesis of decline to fail within 12 months. | →Stable |
| CounterBuilding-product demand is cyclical, and a trough in housing activity could produce a sharp rebound in volumes and pricing. | ||
Earnings quality is a red flag: free cash flow is -178% of net income, and the business has no competitive moat, putting overall quality at 3.1 out of 10. Quality breakdown | Free cash flow conversion should stay weak unless capital spending or working capital normalizes. | →Stable |
| CounterA strong Piotroski F-Score of 7/9 and conservative debt levels suggest the balance sheet can absorb the cash drag. | ||
The price of $73.76 is only 3.5% below the $76.37 analyst target, against 15.0% downside to the stop, a reward-to-risk of 0.24. Upside pct | Without higher analyst targets or an earnings rebound, upside to the target should remain in low single digits. | →Stable |
| CounterAn earnings recovery from a depressed base could drive upward target revisions quickly. | ||
Earnings results are inconsistent: 2 beats and 2 misses over the last four quarters, with the latest EPS of 0.40 missing the 0.57 estimate. Earnings | EPS should reach or exceed estimates in the November 3 report for confidence to improve. | →Stable |
| CounterThe average surprise was strongly positive (about 98%) because estimates were very low, which suggests expectations have already been reset. | ||
The recent price rise looks like an overbought rally within a downtrend: RSI is 77 and the price is below a 200-day average sloping down 2.9% over 30 days. Momentum breakdown | The price should pull back unless it reclaims the 200-day average on rising volume. | Tripped↓Deteriorating |
| CounterRising on-balance volume and an improving MACD indicate real accumulation that could turn the recovery into a durable trend. | ||
Revenue is shrinking: the data shows a 12% decline, which leaves growth ranked at the bottom of its industry peers.
→StableGrowth breakdown
- Expectation
- Revenue should return to flat or positive year-over-year growth for the thesis of decline to fail within 12 months.
CounterBuilding-product demand is cyclical, and a trough in housing activity could produce a sharp rebound in volumes and pricing.
Earnings quality is a red flag: free cash flow is -178% of net income, and the business has no competitive moat, putting overall quality at 3.1 out of 10.
→StableQuality breakdown
- Expectation
- Free cash flow conversion should stay weak unless capital spending or working capital normalizes.
CounterA strong Piotroski F-Score of 7/9 and conservative debt levels suggest the balance sheet can absorb the cash drag.
The price of $73.76 is only 3.5% below the $76.37 analyst target, against 15.0% downside to the stop, a reward-to-risk of 0.24.
→StableUpside pct
- Expectation
- Without higher analyst targets or an earnings rebound, upside to the target should remain in low single digits.
CounterAn earnings recovery from a depressed base could drive upward target revisions quickly.
Earnings results are inconsistent: 2 beats and 2 misses over the last four quarters, with the latest EPS of 0.40 missing the 0.57 estimate.
→StableEarnings
- Expectation
- EPS should reach or exceed estimates in the November 3 report for confidence to improve.
CounterThe average surprise was strongly positive (about 98%) because estimates were very low, which suggests expectations have already been reset.
The recent price rise looks like an overbought rally within a downtrend: RSI is 77 and the price is below a 200-day average sloping down 2.9% over 30 days.
Tripped↓DeterioratingMomentum breakdown
- Expectation
- The price should pull back unless it reclaims the 200-day average on rising volume.
CounterRising on-balance volume and an improving MACD indicate real accumulation that could turn the recovery into a durable trend.
Per-dimension breakdown
Quality
3.1/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.0 |
| ROA | 1.8 |
| Gross margin | 0.0 |
| Op margin | 2.1 |
| Net margin | 1.1 |
| Current ratio | 9.8 |
| FCF quality | 0.0 |
| Moat | 4.6 |
| Piotroski F | 7.8 |
- ▸Earnings quality RED FLAG: -178% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
5.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.0 |
| EPS growth | 10.0 |
- ▸Declining revenue: -12%
Momentum
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 3.9 |
- ▸Overbought bear rally (RSI 71)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -3.0%/30d — confirmed downtrend
Sentiment
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.2 |
| Price target | 7.6 |
| erm sentiment | 5.5 |
Insider
6.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 6.8 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
3.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.8 |
| quality rank | 2.0 |
| growth rank | 0.0 |
- ▸Conservative debt levels
Technical
3.6/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 2.2 |
| support resistance | 1.5 |
| 52w position | 4.8 |
| gap | 6.0 |
Risk (lower is worse)
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 3.5 |
| days to cover | 2.6 |
| volatility | 4.2 |
| put call | 9.0 |
| implied vol | 3.7 |
| beta | 4.6 |
| debt equity | 9.1 |
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.3 |
- ▸Earnings concerns: 2B/2M
- ▸Earnings in 2 days
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (5)
- MOMENTUM:4.8>=4.5
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- ASYMMETRY:0.3<1.5@spot
- DEATH_CROSS:HARD_BLOCK
- EARNINGS_PROXIMITY:2d<=7d
Warning (2)
- MOMENTUM:4.8<5.5 (soft — BUY_NOW allowed but watch)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
0.29
Upside
+3.9%
Downside
13.4%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 71
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.62>1.3
Investment implication
The SELL_IF_HOLDING verdict reflects the ASYMMETRY gate's 0.3<1.5@spot outcome against Sentiment at 6.9 and asymmetric R:R of 0.29.
The strongest dimensions are Sentiment at 6.9, Insider at 6.3, and Catalyst at 5.5; the weakest are Quality at 3.1, Peer rank at 3.4, and Technical at 3.6. The V9 engine flagged 3 failed gates with 2 warnings, producing an asymmetric reward-to-risk of 0.29 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Declining Revenue
Trip ifYear-over-year revenue growth rises above 0% for 2 consecutive quarters.
- P2Poor Cash Conversion
Trip ifFree cash flow to net income rises above 50% from the current -178%.
- P3Thin Upside To Target
Trip ifUpside to the analyst target rises above 15% from the current 3.5%.
- P4Mixed Earnings Record
Trip ifEPS surprise exceeds 0% for 2 consecutive quarters.
- P5Overbought Bear RallyTripped
Trip ifPrice crosses above its 200-day average with RSI staying below 70.