This is part of Q&A from April with Universal Forest Products (UFPI) management. Since this is a stock I recently initiated a position in I will do a write-up on them before long, but one of the most attractive things about the stock to me is the management team. Here is one of the reasons why I want to let these guys run my business .......
April 17, 2007
Q from analyst: Okay. Finally, obviously, your cash flow is – cash flow numbers in from operations are quite solid. Can you just address share buybacks? Just looking at performance over the last number of years, we’ve been in a depressed market for about 12 months now. Your stock price has pretty much averaged at these levels for the last 12 months. The last time you bought stock was approximately two years ago at a little bit below where we are now. Can you just give me some thoughts there?
A from William Currie, Chairman: If we didn’t have an intercompany policy that stated there’d be no insider trading within 48 hours of our release, we would have been buying shares back this morning. Our focus is – it looks to us like our best return on investment over the near term, we’ll switch our focus from acquisitions to stock buybacks, number one; capital expenditures for our industrial operations, number two; and acquisitions, number three.
Q from analyst: Is there currently an authorization by the Board for stock buybacks?A from William Currie: Yes.
A from Michael Cole, CFO: Yes, 1.5 million shares [1.5M shares represent almost 8% of current diluted shares outstanding] . So we have plenty of approved.
I will post my analysis of this company soon (eventually) but hearing stuff like this from one of the my management teams makes me happy ......
* DISCLOSURE: I or accounts I supervise are long UFPI. This is not a recommendation to buy or sell any security. For informational and educational purposes only.
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