Overview
D.A. Davidson has reaffirmed a Buy rating on UFP Industries (NASDAQ: UFPI) and maintained a $112 price target after evaluating the company’s fourth-quarter 2025 results. The stock trades at $106.98 with a price-to-earnings ratio of 19.9, and InvestingPro analysis cited in company materials indicates the shares may be trading below the firm’s estimated Fair Value.
Quarterly performance and drivers
UFP Industries reported fourth-quarter 2025 results that fell short of analysts’ expectations on both the top and bottom lines. Adjusted earnings per share were $0.70, missing the consensus estimate of $1.05 by $0.35. Revenue for the quarter was $1.33 billion, below the $1.4 billion estimate and down 9% from $1.46 billion in the same period a year earlier.
The company attributed the shortfall primarily to greater-than-anticipated gross margin pressures in its Packaging and Construction segments. Additional items that weighed on reported earnings included a higher estimated tax rate, adjustments to year-end bonuses, and certain non-cash transactions. Net sales declined partly because of a 2% decrease in prices and a 7% drop in organic units. Adjusted EBITDA margin narrowed to 8.1% of net sales from 9.1% a year earlier.
Analyst perspective and profit tailwinds
Despite the miss, D.A. Davidson highlighted a number of positive forces that could support profitability in 2026. The firm emphasized expected benefits from structural cost reductions that management has implemented. The analyst note also pointed to specific product-line momentum: within Deckorators, WPC decking sales increased 35% year-over-year in the fourth quarter and Surestone decking sales rose 44% year-over-year in the same period.
D.A. Davidson indicated it will revisit its financial projections after listening to UFP Industries’ conference call, suggesting the firm is awaiting management commentary to refine near-term estimates.
Balance sheet and capital deployment
UFP Industries finished the year with roughly $12 per share in net cash, a position D.A. Davidson flagged as a meaningful source of optionality for capital deployment. An InvestingPro tip noted that the company carries more cash than debt, with a debt-to-equity ratio of 0.12. That balance sheet strength was cited as central to the analyst firm’s outlook.
Implications
The quarter’s results show simultaneous pressures on demand and pricing that reduced margins and earnings in the near term, even as cost actions and strong decking unit performance offer offsetting levers. D.A. Davidson’s Buy stance and $112 target rest on those offsetting factors, plus the flexibility provided by the company’s net-cash position. The analyst review of forecasts after the conference call will clarify how management sees recovery in margins and organic demand.