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Norbord Rises After Upgrade on U.S. Housing Recovery

Feb. 1 (Bloomberg) -- Norbord Inc., the third-largest North American maker of wood sheathing used to build homes, rose the most in three months after BMO Capital Markets upgraded the shares.

Norbord rose 5.3 percent to C$30.79 at the close in Toronto, the most since Nov. 1.

Stephen Atkinson, a Montreal-based BMO analyst, raised his rating to buy from hold and increased his 12-month price target to C$37 from C$35, according to a note today to clients.

Norbord is benefiting from a recovery in U.S. housing construction and higher prices for oriented-strand board, a lumber look-alike that’s made by gluing wood flakes together.

Norbord’s “installed operations ran at near full capacity of 95 percent” last year, Atkinson said in the note

Fourth-quarter net income was $38 million, or 76 cents a share, Toronto-based Norbord said yesterday in a statement. That beat the 73-cent average of eight analysts’ estimates compiled by Bloomberg.

“Our results reflect a U.S. housing recovery that is now well entrenched,” the company said in the statement.

Louisiana-Pacific Corp. is the largest North American maker of OSB by production capacity, followed by Georgia-Pacific LLC, according to a presentation on Norbord’s website.

To contact the reporter on this story: Christopher Donville in Vancouver at cjdonville@bloomberg.net

To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net

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