UPDATE: BMO Capital Markets Upgrades Weyerhaeuser Following Longview Acquisition

In a report published Friday, BMO Capital Markets analyst Stephen Atkinson upgraded Weyerhaeuser WY from Market Perform to Outperform, and reiterated the $33.00 price target.

In the report, BMO Capital Markets noted, “In conjunction with its $2.65 billion acquisition of the Longview fibre timberlands, WY is issuing 29 million shares (underwriters have an option to purchase an additional 4.35 million shares) and 12 million 6.375% Mandatory Convertible Preference Shares Series A at $50/share (option to purchase and additional 1.8mm shares). Each Preference share will convert automatically on July 1, 2016 to between 1.5015 (represent $33.30/share) and 1.8018 (represent $27.75/share) WY common shares. The offering is expected to close on June 24, 2013. Shares outstanding could increase by 52.9 million on a fully diluted basis. Our forecast had assumed a 50-million-share increase. The interest rate is also slightly higher. We have reduced our forecasts accordingly.”

Weyerhaeuser closed on Thursday at $27.03.