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

Stella-Jones (TSE:SJ) posted its earnings results on Thursday. The company reported C$1.59 earnings per share (EPS) for the quarter, FiscalAI reports. The firm had revenue of C$1.04 billion for the quarter. Stella-Jones had a return on equity of 14.85% and a net margin of 8.66%.

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

• Second-quarter profitability declined: Adjusted EBITDA fell to CAD 167 million, with margin decreasing to 16% from 18.3% a year earlier. Higher environmental and maintenance costs, fuel expenses, steel-structure expansion inefficiencies, and delayed pricing recovery weighed on results.
• Utility products remained the main growth driver: Sales rose 7% to CAD 510 million, supported by the Crossarms acquisition and continued wood utility pole volume growth. Management maintained its full-year mid-single-digit organic growth outlook for wood utility poles despite weather-related delays in Texas.
• Margin recovery and efficiency initiatives are expected: Management said normalized second-quarter margin would have been approximately 17.5% and expects improvement in the second half as steel-structure inefficiencies and one-time costs ease. Pole and railway-tie network optimization initiatives are expected to generate approximately CAD 10–12 million and CAD 10–15 million, respectively, in annual profitability improvements beginning in 2027.
• Railway ties faced lower Class I volumes but commercial demand helped offset the decline: First-half sales were down 2%, while management expects full-year volumes to range from flat to down 2%. Treating-services-only, or TSO, volumes are expected to represent 5%–10% of tie sales going forward, improving returns but reducing reported revenue per unit.
• Growth capacity and balance-sheet flexibility remain strong: Candiac’s steel-structure modernization is on track to double capacity to 20,000 tons by the third quarter, with substantial demand secured through 2027, while the planned Fayetteville facility is expected to add another 20,000 tons by 2028. The company also reduced net debt by more than CAD 100 million in the first half and ended the quarter with CAD 759 million of liquidity.

Stella-Jones Stock Up 2.7%

Stella-Jones stock traded up C$2.04 during trading on Friday, reaching C$76.66. 250,507 shares of the company’s stock were exchanged, compared to its average volume of 151,076. Stella-Jones has a 52-week low of C$69.94 and a 52-week high of C$101.31. The firm has a market cap of C$4.18 billion, a price-to-earnings ratio of 13.89, a PEG ratio of 2.40 and a beta of -0.07. The company has a debt-to-equity ratio of 80.71, a quick ratio of 1.20 and a current ratio of 4.96. The company’s 50-day moving average is C$79.49 and its two-hundred day moving average is C$85.32.

Stella-Jones News Summary

Here are the key news stories impacting Stella-Jones this week:

• Neutral Sentiment: Stella-Jones reported quarterly revenue of C$1.04 billion and earnings of C$1.59 per share, with an 8.66% net margin and 14.85% return on equity. The release did not provide enough information to determine whether results exceeded analyst expectations. Stella-Jones quarterly earnings report
• Neutral Sentiment: The company’s Q2 2026 earnings call transcript provides additional management commentary and guidance that investors may use to assess demand, margins and the outlook for the remainder of the year. Stella-Jones Q2 2026 earnings call transcript
• Negative Sentiment: Raymond James lowered its price target to C$83 from C$90, while maintaining an “outperform” rating. The revised target still represents approximately 8.8% potential upside, limiting the negative impact of the cut. Raymond James Stella-Jones analyst rating
• Negative Sentiment: National Bank Financial reduced its target to C$92 from C$95 and maintained a “sector perform” rating, indicating modestly positive potential return but limited conviction. National Bank Financial Stella-Jones analyst rating
• Negative Sentiment: Desjardins cut its target to C$99 from C$104 but retained a “buy” rating, implying approximately 29.8% upside and offering the most bullish view among the updated forecasts. Desjardins Stella-Jones analyst rating
• Negative Sentiment: RBC lowered its target to C$79 from C$82 and kept a “sector perform” rating, leaving only about 3.6% implied upside. RBC Stella-Jones analyst rating

Wall Street Analysts Forecast Growth

Several brokerages recently weighed in on SJ. National Bank Financial cut their target price on Stella-Jones from C$95.00 to C$92.00 and set a “sector perform” rating on the stock in a research report on Friday. Scotiabank dropped their price target on Stella-Jones from C$99.00 to C$97.00 and set a “sector outperform” rating for the company in a research note on Tuesday, April 28th. Raymond James Financial cut their price objective on Stella-Jones from C$90.00 to C$83.00 and set an “outperform” rating on the stock in a report on Friday. Royal Bank Of Canada reduced their price objective on Stella-Jones from C$82.00 to C$79.00 and set a “sector perform” rating on the stock in a research note on Friday. Finally, TD decreased their target price on Stella-Jones from C$106.00 to C$93.00 and set a “buy” rating for the company in a report on Monday, May 11th. Five investment analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company’s stock. According to MarketBeat.com, Stella-Jones has an average rating of “Moderate Buy” and an average target price of C$91.50.

Insiders Place Their Bets

In related news, Director Anne Elizabeth Giardini bought 1,000 shares of the stock in a transaction dated Monday, May 11th. The stock was acquired at an average price of C$71.25 per share, for a total transaction of C$71,250.00. Following the completion of the purchase, the director owned 3,400 shares in the company, valued at C$242,250. This represents a 41.67% increase in their ownership of the stock. Also, Director Kevin Patrick Comerford bought 500 shares of the company’s stock in a transaction that occurred on Monday, May 11th. The shares were bought at an average price of C$72.06 per share, for a total transaction of C$36,030.00. Following the completion of the acquisition, the director owned 6,176 shares in the company, valued at approximately C$445,042.56. This trade represents a 8.81% increase in their position. Insiders have purchased a total of 3,443 shares of company stock worth $247,814 over the last quarter. 0.14% of the stock is owned by corporate insiders.

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.