UPDATE: D.A. Davidson Upgrades Universal Forest Products to Buy, Raises PT on Good Q1 Results

In a report published Thursday, D.A. Davidson analyst Steven Chercover upgraded the rating on Universal Forest Products

from Neutral to Buy, and slightly raised the price target from $43.00 to $44.00. In the report, Chercover noted, “Universal Forest Products started off 2013 on a strong note, posting earnings of $0.26 as compared to $0.21 in Q1-12 and up sharply from a loss of $0.10 last quarter. Revenues were in line with our estimate of $554 million, which represented a 21% increase year-over-year. The primary variance to our $0.01 estimate came from the cost front, with lighter SG&A (+$0.16). Also, despite lumber prices escalating 43% over the prior year (which crimps margins), COGS was well below expectations, providing the other significant variance to earnings (+$0.09). While our top line forecast was very accurate, the composition wasn't perfect, with Retail and Residential Construction coming in light of our estimates and Industrial, Commercial & Concrete, and Manufactured Housing beating our projections.” Universal Forest Products closed on Wednesday at $34.09.