No. of Recommendations: 5
PCL is a REIT which owns and manages timberland in the US, and makes various wood-based products.

The author's conclusion: "As the need for new buildings and spending increases on upgrading and repairing peoples current homes, Plum Creek is a company well situated well to capitalize on this trend". ([sic] on the repetition of `well` -- this is a copy and paste!-).

I've been long with a substantial PCL position for a long time, basically on Bismarck's theory of timberland investing, so well explained by Barton Biggs in an appendix to his "Hedge-hogging" book.

At this time, alas, it looks like a lot of investors agree with the SA article's thesis (which is "long-term" only in the loosest sense -- if you read the article you'll see the thesis should play out in 3 to 5 years at most -- as opposed to Bismarck's generational time scale, which I doubt any significant number of investors care about!-), so, PCL is hardly undervalued, at a P/E over 40 and a dividend yield just above 3%.

So, I won't be adding more at this time; I'll just keep holding patiently... but if I didn't have any timberland exposure I might perhaps consider initiating a small exploratory position even now.
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