LP Building Products (LPX)

Company

"LP Building Products is a leading manufacturer of high quality building materials. Builders and homeowners use our products primarily in new construction, repair and remodeling, and manufactured housing. LP products are sold through distributors, dealers, professional lumberyards, and retail home centers." (company website)

lpx(1-1)
LPX 4-month chart
lpx(1-1)_1yr
LPX 1-year chart

Buy

1 February 2010. Bought 500 at $7.14.

Hard-hit by the bust in housing, LPX hit rock bottom in March of last year. Since then it has climbed to two peaks and then pulled back 60% before another upswing. It is now 60% below the September peak and shows signs of swinging up again. In November, the company delivered a nice earnings Surprise by narrowing losses beyond Expectations.

  • Percentage price oscillator (PPO) — below the signal line, but beginning to converge back toward it
  • Volume — increasing ever so slightly after a long decline

Based on technical analysis, MarketEdge calls LPX a "strong buy" in a "weak upward trend," noting that it is "oversold" and at a "good entry point."

Sell

gain Bottom line
11%

23 February 2010. Sold 500 at $7.95.

LPX has jumped in the last few days with heavy volume after comments from S&P, despite a nasty earnings surprise. Given the size of the jump, it makes sense to me to pocket a nice profit rather than count on further price advances in the near term.