Rayonier Navigates a Challenging Timber Market in Q4 as Demand Softens; Shares Fairly Valued

Rayonier finished a challenging 2022 with relative strength despite lower lumber prices and softening demand in most of its markets. Revenue in the fourth quarter decreased 6% year over year as log prices fared better than lumber prices and its real estate business capitalized on strong timberland prices. Management provided full-year 2023 guidance, where it anticipates earnings per share between $0.36 and $0.50. We think this guidance is attainable given its outlook of higher harvest volume and lower weighted average stumpage prices. We've increased our fair value estimate to $38 from $37 per share due to time value of money.