Top-Notch Lumber Companies Worth Investing in by 2025
Exploring some of the finest lumber stocks to invest in this pivotal year, let's dive into the world of homebuilding and home improvement with these top picks.
Premier Lumber Choices in 2025
Grasp the essence of these giants in the lumber industry and why they're high on the investment radar.
| Company | Ticker | Background ||--------------------|-------------|-----------------------------------------------------------------------------------------------------------|| International Paper | IP | Global leader in paper manufacturing and packaging, with a strong emphasis on industrial paper and e-commerce || Boise Cascade | BCC | Diversified wood products company, focusing on home construction and remodeling || West Fraser | WFG | Lumber producer, integrating various wood and paper products, with strong North American focus || UFP Industries | UFPI | Global provider of treated lumber, manufacturing decking, fencing, and other wood-based materials |
1. International Paper
While demand for traditional paper products may have waned, International Paper has adapted to the digital age, thriving in the face of adversity. Touting a hefty dividend, this major paper manufacturer has made strides in industrial packaging, accounting for over 80% of its revenue.
Since the 2021 spinoff of Sylvamo (its printing paper division), International Paper has transformed into a pure-play in that category.
(NYSE:IP)
Despite a slight revenue decline over the first three quarters of 2024, the acquisition of DS Smith, a British packaging company, is set to close in 2025. This merger is expected to bolster innovation, geographic reach, and scale, offering value and income investors an attractive offering.
Maker of paper products under brands such as Hammermill, Springhill, and Williamsburg
2. Boise Cascade
As one of the top-performing lumber stocks in recent years, Boise Cascade fans have seen the stock soar over four-fold since 2020, driven by thriving lumber prices. Though revenue dipped slightly during the same period, interest rate cuts could spur a housing market revival.
(NYSE:BCC)
The company's acquisitions strategy, most recently the Parksite door shop in Florida, continue to fuel growth, while its steady dividend offers investors a tasty 0.7% yield.
Manufacturer of wood products, primarily for home construction and home improvement
3. West Fraser
While most of West Fraser's 2023 revenue stemmed from lumber, this lumber producer branches out, also offering pulp, paper, and engineered wood products, such as plywood panels. After acquiring Canadian timber company Norbord in February 2021, the company's revenue has taken a hit; however, its North American engineered wood products, like oriented strand board, have remained resilient.
(NYSE:WFG)
With a focus on the North American housing market's long-term trends, West Fraser is well-positioned for eventual residential construction upticks.
Lumber producer and maker of a variety of wood and paper products
4. UFP Industries
A diverse lumber and wood materials conglomerate, UFP Industries is structured around three segments - construction, packaging, and retail solutions, including decking, siding, and fencing. Similar to its peers, UFP's top line has seen declines during the recessionary period; however, the company remains focused on reducing expenses and driving efficiencies.
(NYSE:UFPI)
C&L Wood Products, an Alabama-based small producer, was recently acquired to strengthen the company's pallet and mulch offerings, aiming to boost demand for UFP's wood products in residential repairs and retail construction.
Global manufacturer of treated lumber products, like decking and fencing
Investing in Commodities: Exercise Caution
Investing in commodity stocks, such as lumber, can be tricky due to volatile, unpredictable pricing dependents, like natural disasters, geopolitical tensions, and market fluctuations. But with lumber's importance in homebuilding and home furnishings, it seems poised for growth.
Understanding the competitive advantages of these industry heavyweights and their resilience in difficult conditions paves the way for smart, long-term investments.
In the realm of finance, many investors are considering the potential of investing in lumber stocks due to their significance in homebuilding and home improvement. For instance, Boise Cascade, a diverse wood products company with a focus on home construction and remodeling, has seen its stock soar in recent years, despite a slight revenue decline. (Boise Cascade, BCC)
Investors also find appeal in large-scale companies like International Paper, which has transformed into a pure-play in the paper manufacturing and packaging industry after a spinoff. Despite a slight revenue decline in 2024, acquisitions such as DS Smith are expected to boost the company's geographic reach and scale, offering value and income for investors. (International Paper, IP)
