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Clearwater Paper (CLW) to Permanently Close Neenah Plant
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Clearwater Paper Corporation (CLW - Free Report) declared ramp down of three tissue machines and 10 converting lines of its Neenah, WI-based paper plant. This will eliminate a paper production capacity of around 54,000 tons. Clearwater Paper plans to close the Neenah facility for an indefinite period and exit the away-from-home business by the end of July.
Management is taking this action as the Neenah plant’s location and its assets cannot compete cost-effectively in the company’s served markets. Notably, the plant closure will impact approximately 290 employees. Meanwhile, the company is focused on supporting its employees through this tough time by assisting them in receiving training and other benefits that will help them find new employment.
In 2010, Clearwater Paper bought the Neenah mill, which produced private brand tissue products for commercial and retail customers.
Last month, the company reported first-quarter 2021 adjusted earnings of 69 cents per share, missing the Zacks Consensus Estimate of 91 cents. It reported adjusted earnings per share of 57 cents in the prior-year quarter. Revenues of $426 million declined 11% year over year and missed the consensus mark of $439 million.
The company has been witnessing strong demand for tissue amid the pandemic. The market for tissue in the United States is traditionally two-thirds at home and one-third away from home. With customers staying at home amid the pandemic, it has led to the heightened demand for tissue. Moreover, the company’s paperboard business continues to perform well with favorable market dynamics. The folding carton customers, with exposure to food and healthcare packaging, continue to witness strong demand amid the pandemic. However, material cost inflation and maintenance outages are likely to impact the company’s bottom line.
Price Performance
Clearwater Paper’s shares have lost 8.8% in the past year against the industry’s rally of 82.7%.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
ArcelorMittal has a projected earnings growth rate of 984.7% for the current year. The company’s shares have soared nearly 179% in the past year.
Cabot has an expected earnings growth rate of 125.9% for fiscal 2021. The company’s shares have rallied 79.4% over the past year.
Dow has an estimated earnings growth rate of 261.6% for the current year. The company’s shares have gained roughly 78% in a year’s time.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Image: Bigstock
Clearwater Paper (CLW) to Permanently Close Neenah Plant
Clearwater Paper Corporation (CLW - Free Report) declared ramp down of three tissue machines and 10 converting lines of its Neenah, WI-based paper plant. This will eliminate a paper production capacity of around 54,000 tons. Clearwater Paper plans to close the Neenah facility for an indefinite period and exit the away-from-home business by the end of July.
Management is taking this action as the Neenah plant’s location and its assets cannot compete cost-effectively in the company’s served markets. Notably, the plant closure will impact approximately 290 employees. Meanwhile, the company is focused on supporting its employees through this tough time by assisting them in receiving training and other benefits that will help them find new employment.
In 2010, Clearwater Paper bought the Neenah mill, which produced private brand tissue products for commercial and retail customers.
Last month, the company reported first-quarter 2021 adjusted earnings of 69 cents per share, missing the Zacks Consensus Estimate of 91 cents. It reported adjusted earnings per share of 57 cents in the prior-year quarter. Revenues of $426 million declined 11% year over year and missed the consensus mark of $439 million.
The company has been witnessing strong demand for tissue amid the pandemic. The market for tissue in the United States is traditionally two-thirds at home and one-third away from home. With customers staying at home amid the pandemic, it has led to the heightened demand for tissue. Moreover, the company’s paperboard business continues to perform well with favorable market dynamics. The folding carton customers, with exposure to food and healthcare packaging, continue to witness strong demand amid the pandemic. However, material cost inflation and maintenance outages are likely to impact the company’s bottom line.
Price Performance
Clearwater Paper’s shares have lost 8.8% in the past year against the industry’s rally of 82.7%.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
A few better-ranked stocks in the basic materials space are ArcelorMittal (MT - Free Report) , Cabot Corporation (CBT - Free Report) and Dow Inc. (DOW - Free Report) . All the companies currently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ArcelorMittal has a projected earnings growth rate of 984.7% for the current year. The company’s shares have soared nearly 179% in the past year.
Cabot has an expected earnings growth rate of 125.9% for fiscal 2021. The company’s shares have rallied 79.4% over the past year.
Dow has an estimated earnings growth rate of 261.6% for the current year. The company’s shares have gained roughly 78% in a year’s time.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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