Value
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.6 |
| P/S | 9.8 |
| EV/EBITDA | 6.2 |
| Fwd P/E | 7.6 |
| PEG | 8.1 |
| Analyst target | 4.0 |
- ▸Forward P/E: 16.3x
- ▸PEG: 0.82
UFPI · Why this verdict
Why UFP Industries (UFPI) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
UFP Industries trades at an attractive forward multiple of 15.4x with a PEG of 0.78, but persistent earnings misses across all four recent quarters and negative free cash flow quality undermine the value thesis and require earnings improvement before the discount narrows.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
With upside of only 5.9% against a downside of 8.4%, the reward-to-risk ratio of 1.09 is far below the minimum threshold of 1.5 required for an asymmetric entry, making current price levels unfavorable for new positions. Targets | Price falls to an entry level where upside exceeds 15% against comparable downside, restoring a favorable risk-reward ratio above 1.5 | →Stable |
| CounterAnalyst consensus still implies 22% upside to the price target, which would improve the asymmetry ratio if the stock corrects to a lower entry level | ||
UFP Industries has missed earnings estimates in every one of the last four quarters, with an average shortfall of 16.7%, indicating that the business is consistently delivering below analyst expectations. Earnings | Earnings surprise turns positive in at least 2 of the next 4 quarters, reducing the miss streak | →Stable |
| CounterDeclining revenue of -8% and below-average quality scores suggest the miss pattern reflects genuine fundamental deterioration rather than overly optimistic estimates | ||
The stock trades at a forward P/E of 15.4x with a PEG of 0.78, suggesting the market is pricing in below-trend growth expectations that may overstate the downside if revenue stabilizes. Valuation breakdown | Revenue decline narrows toward flat year-over-year within 12 months, supporting re-rating toward peer multiples | →Stable |
| CounterDeclining revenue of -8% year-over-year and quality score of 3.9 below the minimum threshold mean the low multiple may be warranted rather than a discount to fair value | ||
The put/call ratio of 2.67 and implied volatility of 83% signal that options market participants are positioned heavily for further downside, representing a meaningful sentiment overhang on the stock. Options | Put/call ratio falls below 1.5 as earnings stabilize and bearish hedging activity unwinds over 12 months | →Stable |
| CounterElevated put/call ratios can persist or worsen when fundamental deterioration continues, and the stock is already trading above max pain at $75 | ||
With upside of only 5.9% against a downside of 8.4%, the reward-to-risk ratio of 1.09 is far below the minimum threshold of 1.5 required for an asymmetric entry, making current price levels unfavorable for new positions.
→StableTargets
- Expectation
- Price falls to an entry level where upside exceeds 15% against comparable downside, restoring a favorable risk-reward ratio above 1.5
CounterAnalyst consensus still implies 22% upside to the price target, which would improve the asymmetry ratio if the stock corrects to a lower entry level
UFP Industries has missed earnings estimates in every one of the last four quarters, with an average shortfall of 16.7%, indicating that the business is consistently delivering below analyst expectations.
→StableEarnings
- Expectation
- Earnings surprise turns positive in at least 2 of the next 4 quarters, reducing the miss streak
CounterDeclining revenue of -8% and below-average quality scores suggest the miss pattern reflects genuine fundamental deterioration rather than overly optimistic estimates
The stock trades at a forward P/E of 15.4x with a PEG of 0.78, suggesting the market is pricing in below-trend growth expectations that may overstate the downside if revenue stabilizes.
→StableValuation breakdown
- Expectation
- Revenue decline narrows toward flat year-over-year within 12 months, supporting re-rating toward peer multiples
CounterDeclining revenue of -8% year-over-year and quality score of 3.9 below the minimum threshold mean the low multiple may be warranted rather than a discount to fair value
The put/call ratio of 2.67 and implied volatility of 83% signal that options market participants are positioned heavily for further downside, representing a meaningful sentiment overhang on the stock.
→StableOptions
- Expectation
- Put/call ratio falls below 1.5 as earnings stabilize and bearish hedging activity unwinds over 12 months
CounterElevated put/call ratios can persist or worsen when fundamental deterioration continues, and the stock is already trading above max pain at $75
Per-dimension breakdown
Quality
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.8 |
| ROA | 3.4 |
| Gross margin | 0.0 |
| Op margin | 1.7 |
| Net margin | 2.2 |
| Current ratio | 8.4 |
| FCF quality | 4.6 |
| Moat | 4.6 |
| Piotroski F | 7.8 |
- ▸Earnings quality warning: 59% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
3.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.4 |
| EPS growth | 6.0 |
- ▸Declining revenue: -8%
Momentum
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 2.7 |
| MACD | 10.0 |
| OBV | 1.0 |
| MA position | 6.0 |
| Volume | 0.0 |
- ▸Overbought bear rally (RSI 74)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -2.7%/30d — confirmed downtrend
Sentiment
5.9/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 6.8 |
| erm sentiment | 6.0 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.8 |
| quality rank | 5.0 |
| growth rank | 2.5 |
Technical
1.9/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 0.0 |
| 52w position | 5.6 |
Risk (lower is worse)
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.2 |
| days to cover | 8.2 |
| volatility | 5.1 |
| put call | 9.2 |
| implied vol | 5.3 |
| beta | 6.0 |
| debt equity | 9.5 |
Catalyst
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 7.0 |
- ▸Earnings concerns: 0B/4M
- ▸Dividend: 160.0%
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (5)
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:32d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:3.9<4.5
- ASYMMETRY:-0.1=NEGATIVE
- DEATH_CROSS:HARD_BLOCK
Warning (1)
- 8K_FLAG:5.01
Reward-to-Risk
-0.15
Upside
-2.1%
Downside
14.2%
Sizing output
AVOID
SetupRECOVERY — Death cross but MACD improving, RSI 74
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Risk (lower is worse) at 7.4 could not lift the engine output above the verdict floor. Failed gate signal: MOMENTUM:3.9<4.5.
The strongest dimensions are Risk (lower is worse) at 7.4, Value at 7.0, and Sentiment at 5.9; the weakest are Technical at 1.9, Growth at 3.2, and Catalyst at 3.7. The V9 engine flagged 3 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.15 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1UFP Industries has missed earnings estimates in every one of the last four quarters, with an average shortfall of 16.7%, indicating that the business is consistently delivering below analyst expectations.
Trip ifEPS surprise falls below -10% in at least 3 of the next 4 quarters, continuing the miss streak
- P2The stock trades at a forward P/E of 15.4x with a PEG of 0.78, suggesting the market is pricing in below-trend growth expectations that may overstate the downside if revenue stabilizes.
Trip ifRevenue growth declines by more than 10% year-over-year for 2 or more consecutive quarters
- P3The put/call ratio of 2.67 and implied volatility of 83% signal that options market participants are positioned heavily for further downside, representing a meaningful sentiment overhang on the stock.
Trip ifPut/call ratio rises above 3.5 or implied volatility exceeds 100%
- P4With upside of only 5.9% against a downside of 8.4%, the reward-to-risk ratio of 1.09 is far below the minimum threshold of 1.5 required for an asymmetric entry, making current price levels unfavorable for new positions.
Trip ifPrice rises above $92 without earnings improvement, pushing upside below 0% against the analyst target