Value
6.1/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 1.8 |
| P/S | 8.9 |
| EV/EBITDA | 1.7 |
| Fwd P/E | 6.2 |
| PEG | 10.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 20.9x
- ▸PEG: 0.10
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.
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. The TrendMatrix editorial team frequently holds personal long-term positions in securities discussed. We disclose positions held at the time of publication on each piece. We maintain a trading-window policy: we do not initiate or close positions in the same direction as a TrendMatrix publication within 24 hours before or 72 hours after publication.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security. Our sole compensation is subscription revenue.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score5.0/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Quality is below the minimum investable threshold, free cash flow is negative, revenue is contracting 21% year-over-year, and the risk/reward geometry is unfavorable with only 3.1% headroom to the analyst target; improving near-term momentum with rising on-balance volume and an improving MACD is the sole constructive signal and is insufficient to offset the fundamental impairment.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The business scores 3.4 out of 10 on quality — below the 4.0 minimum threshold — with no competitive moat and thin margins across returns and profitability metrics, disqualifying the stock from new investment consideration. Quality breakdown | Gross margin turns positive and the overall quality score rises above 4.0 and sustains for at least 2 consecutive quarters before the stock meets the minimum investable standard. | →Stable |
| CounterThe Piotroski financial health score of 7 out of 9 is a constructive signal reflecting balance-sheet stability and improving financial conditions even in the absence of a competitive moat; near-term balance-sheet resilience may be understated by the overall quality composite. | ||
Free cash flow is negative — the most recent period shows free cash flow at -80% relative to reported net income — meaning the business is consuming more cash than it generates and reported earnings overstate economic value creation. Quality breakdown | Free cash flow turns positive and remains above zero for 2 consecutive quarters, demonstrating the business can self-fund rather than requiring external capital. | →Stable |
| CounterNegative free cash flow in a building-products business can reflect deliberate inventory build or capital investment ahead of a demand recovery; if volumes recover, operating leverage could normalize cash generation quickly without a change in underlying profitability. | ||
Revenue is declining at 21% year-over-year — a steep contraction that places the business at the floor of its peer group for growth and signals a significant loss of volume or pricing power in the underlying market. Growth breakdown | Revenue growth turns positive and exceeds 0% year-over-year for 2 consecutive quarters, indicating the contraction phase has ended. | →Stable |
| CounterThe two most recent quarterly earnings beats — each with a large positive surprise — suggest that cost discipline or favorable mix is driving earnings recovery even as revenue contracts; if the volume cycle turns, revenue inflection could follow earnings improvement with a one-to-two quarter lag. | ||
With only 3.1% headroom to the analyst take-profit target from the current price and a risk/reward ratio of 0.44 — well below the 1.5-to-1 minimum — the geometric setup is unfavorable and the asymmetry gate fails at current spot. Price targets | The analyst consensus price target rises above $90, restoring at least 16% upside from the current level and creating a viable entry setup. | →Stable |
| CounterThe unfavorable geometry reflects price proximity to the resistance target, not a fundamentally deteriorating business; a pullback to near $68 would restore a more favorable ratio without requiring any improvement in fundamentals. | ||
The momentum dimension scores 6.4 out of 10, with MACD improving, on-balance volume accumulating, and the near-term technical recovery setup in place — suggesting that short-term buying interest is building even as the longer-term trend remains negative. Momentum breakdown | Price crosses and holds above the 200-day moving average for 2 consecutive months, confirming the short-term momentum improvement has translated into a sustained trend reversal. | ↓Deteriorating |
| CounterRising on-balance volume and improving MACD in a stock carrying a death-cross warning and trading below its 200-day moving average can reflect temporary short-covering rather than genuine accumulation; absent fundamental recovery, the momentum signal may prove transient. | ||
The business scores 3.4 out of 10 on quality — below the 4.0 minimum threshold — with no competitive moat and thin margins across returns and profitability metrics, disqualifying the stock from new investment consideration.
→StableQuality breakdown
- Expectation
- Gross margin turns positive and the overall quality score rises above 4.0 and sustains for at least 2 consecutive quarters before the stock meets the minimum investable standard.
CounterThe Piotroski financial health score of 7 out of 9 is a constructive signal reflecting balance-sheet stability and improving financial conditions even in the absence of a competitive moat; near-term balance-sheet resilience may be understated by the overall quality composite.
Free cash flow is negative — the most recent period shows free cash flow at -80% relative to reported net income — meaning the business is consuming more cash than it generates and reported earnings overstate economic value creation.
→StableQuality breakdown
- Expectation
- Free cash flow turns positive and remains above zero for 2 consecutive quarters, demonstrating the business can self-fund rather than requiring external capital.
CounterNegative free cash flow in a building-products business can reflect deliberate inventory build or capital investment ahead of a demand recovery; if volumes recover, operating leverage could normalize cash generation quickly without a change in underlying profitability.
Revenue is declining at 21% year-over-year — a steep contraction that places the business at the floor of its peer group for growth and signals a significant loss of volume or pricing power in the underlying market.
→StableGrowth breakdown
- Expectation
- Revenue growth turns positive and exceeds 0% year-over-year for 2 consecutive quarters, indicating the contraction phase has ended.
CounterThe two most recent quarterly earnings beats — each with a large positive surprise — suggest that cost discipline or favorable mix is driving earnings recovery even as revenue contracts; if the volume cycle turns, revenue inflection could follow earnings improvement with a one-to-two quarter lag.
With only 3.1% headroom to the analyst take-profit target from the current price and a risk/reward ratio of 0.44 — well below the 1.5-to-1 minimum — the geometric setup is unfavorable and the asymmetry gate fails at current spot.
→StablePrice targets
- Expectation
- The analyst consensus price target rises above $90, restoring at least 16% upside from the current level and creating a viable entry setup.
CounterThe unfavorable geometry reflects price proximity to the resistance target, not a fundamentally deteriorating business; a pullback to near $68 would restore a more favorable ratio without requiring any improvement in fundamentals.
The momentum dimension scores 6.4 out of 10, with MACD improving, on-balance volume accumulating, and the near-term technical recovery setup in place — suggesting that short-term buying interest is building even as the longer-term trend remains negative.
↓DeterioratingMomentum breakdown
- Expectation
- Price crosses and holds above the 200-day moving average for 2 consecutive months, confirming the short-term momentum improvement has translated into a sustained trend reversal.
CounterRising on-balance volume and improving MACD in a stock carrying a death-cross warning and trading below its 200-day moving average can reflect temporary short-covering rather than genuine accumulation; absent fundamental recovery, the momentum signal may prove transient.
Per-dimension breakdown
Quality
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.6 |
| ROA | 2.8 |
| Gross margin | 0.0 |
| Op margin | 2.6 |
| Net margin | 1.6 |
| Current ratio | 9.7 |
| FCF quality | 0.0 |
| Moat | 4.6 |
| Piotroski F | 7.8 |
- ▸Earnings quality RED FLAG: -80% 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: -21%
Momentum
1.8/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 3.0 |
| Volume | 0.7 |
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -2.8%/30d — confirmed downtrend
Sentiment
7.1/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.2 |
| Price target | 8.2 |
| erm sentiment | 5.6 |
- ▸Analyst upside: 25%
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸Negligible insider selling — $89,238 (0.002% of mkt cap)
- ▸Institutions accumulating
Peer rank
3.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.6 |
| quality rank | 2.4 |
| growth rank | 0.4 |
- ▸Conservative debt levels
Technical
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.5 |
| support resistance | 6.2 |
| 52w position | 4.7 |
Risk (lower is worse)
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 5.0 |
| days to cover | 4.9 |
| volatility | 2.0 |
| put call | 10.0 |
| implied vol | 3.2 |
| beta | 4.7 |
| debt equity | 9.1 |
- ▸High IV: 61%
- ▸Concentration risks: 2 MED (10-K Item 1A)
Catalyst
5.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 4.3 |
- ▸Earnings concerns: 2B/2M
- ▸Earnings in 10 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 (4)
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:1.8<4.5
- ASYMMETRY:1.1<1.5@spot
- DEATH_CROSS:HARD_BLOCK
Warning (2)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
- EARNINGS_PROXIMITY:10d<=14d (soft)
Reward-to-Risk
1.07
Upside
+9.0%
Downside
8.4%
Sizing output
AVOID
SetupRange Bound — RSI 44 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.59>1.3
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 1.8<4.5 outcome against Insider at 7.3 and asymmetric R:R of 1.07.
The strongest dimensions are Insider at 7.3, Sentiment at 7.1, and Value at 6.1; the weakest are Momentum at 1.8, Quality at 3.4, and Peer rank at 3.8. The V9 engine flagged 3 failed gates with 2 warnings, producing an asymmetric reward-to-risk of 1.07 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Below Minimum Floor
Trip ifGross margin turns positive and quality score rises above 4.0 for 2 consecutive quarters.
- P2Negative Free Cash Flow
Trip ifFree cash flow turns positive and remains above $0 for 2 consecutive quarters.
- P3Sharply Declining Revenue
Trip ifRevenue growth exceeds 0% year-over-year for 2 consecutive quarters.
- P4Unfavorable Risk Reward Geometry
Trip ifAnalyst consensus price target rises above $90, restoring at least 16% upside from the current price of $77.23.
- P5Improving Near Term Momentum
Trip ifRSI falls below 45 for 2 consecutive months without price breaking above the 200-day moving average, invalidating the short-term accumulation signal.