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Veritiv (VRTV) to Divest Canada Business to Imperial Dade
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Veritiv Corporation entered into a purchase agreement with Imperial Dade to divest its Veritiv Canada, Inc. business. The move will support the company’s strategy to focus on businesses with higher growth and margin as well as geographies. The sale would also accelerate VRTV’s investment in building the Packaging and Facility Solutions capabilities.
Net proceeds from the deal are expected to be utilized in Veritiv’s recently-announced share repurchase program of $200 million and support future capital allocation priorities and growth initiatives.
The deal is likely to close before the end of the second quarter, subject to Canadian regulatory approval. Around 900 employees in Veritiv Canada business will become employees of Imperial Dade upon the deal’s closure.
Veritiv is witnessing robust volume growth within the wholesale, retail, logistics and manufacturing customer sectors. In 2021, the company strengthened its position as the leading provider of packaging, distribution services, products and solutions in North America. It will continue to make investments in market-beating packaging growth and shift its segment portfolio toward these businesses. The company will also make investments in technology to enhance commercial capabilities, operating efficiency and customer experience.
Veritiv reported earnings per share (EPS) of $3.67 in the fourth quarter of 2021. The bottom-line figure beat the Zacks Consensus Estimate of $2.66 and increased 93% year over year aided by continued Packaging sales growth and operational efficiencies.
Veritiv expects net income in the range of $210-$250 million in 2022. EPS are expected in the band of $13.50-$16.25 for the year. Veritiv anticipates adjusted EBITDA in the range of $395-$435 million.
The company anticipates supplier-driven price increases to continue during the first half of the year. It predicts adjusted EBITDA margins for the segments to be in line with the prior-year levels or to deliver a slight year-over-year improvement aided by continued cost and price discipline as well as initiatives to mitigate the impacts of inflation.
Price Performance
Shares of Veritiv have surged 218.8% in the past year against the industry’s decline of 1.2%.
Some other top-ranked stocks in the basic materials space are The Mosaic Company (MOS - Free Report) , AdvanSix Inc. (ASIX - Free Report) and Allegheny Technologies Incorporated (ATI - Free Report) , each sporting a Zacks Rank #1, at present.
Mosaic has a projected earnings growth rate of 106.4% for the current year. The Zacks Consensus Estimate for MOS' current-year earnings has been revised upward by 22.2% in the past 60 days.
Mosaic beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters and missed once, the average surprise being 3.7%. MOS has rallied around 87.3% in a year.
AdvanSix has a projected earnings growth rate of 30.6% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 25% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters, while missing once, the average surprise being 23.6%. ASIX has surged 57.3% in a year.
Allegheny has an expected earnings growth rate of 661.5% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised upward by 45.6% in the past 60 days.
Allegheny beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average surprise being 127.2%. ATI has rallied around 21.3% over a year.
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Veritiv (VRTV) to Divest Canada Business to Imperial Dade
Veritiv Corporation entered into a purchase agreement with Imperial Dade to divest its Veritiv Canada, Inc. business. The move will support the company’s strategy to focus on businesses with higher growth and margin as well as geographies. The sale would also accelerate VRTV’s investment in building the Packaging and Facility Solutions capabilities.
Net proceeds from the deal are expected to be utilized in Veritiv’s recently-announced share repurchase program of $200 million and support future capital allocation priorities and growth initiatives.
The deal is likely to close before the end of the second quarter, subject to Canadian regulatory approval. Around 900 employees in Veritiv Canada business will become employees of Imperial Dade upon the deal’s closure.
Veritiv is witnessing robust volume growth within the wholesale, retail, logistics and manufacturing customer sectors. In 2021, the company strengthened its position as the leading provider of packaging, distribution services, products and solutions in North America. It will continue to make investments in market-beating packaging growth and shift its segment portfolio toward these businesses. The company will also make investments in technology to enhance commercial capabilities, operating efficiency and customer experience.
Veritiv reported earnings per share (EPS) of $3.67 in the fourth quarter of 2021. The bottom-line figure beat the Zacks Consensus Estimate of $2.66 and increased 93% year over year aided by continued Packaging sales growth and operational efficiencies.
Veritiv expects net income in the range of $210-$250 million in 2022. EPS are expected in the band of $13.50-$16.25 for the year. Veritiv anticipates adjusted EBITDA in the range of $395-$435 million.
The company anticipates supplier-driven price increases to continue during the first half of the year. It predicts adjusted EBITDA margins for the segments to be in line with the prior-year levels or to deliver a slight year-over-year improvement aided by continued cost and price discipline as well as initiatives to mitigate the impacts of inflation.
Price Performance
Shares of Veritiv have surged 218.8% in the past year against the industry’s decline of 1.2%.
Image Source: Zacks Investment Research
Zacks Rank & Other Stocks to Consider
Veritiv currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Some other top-ranked stocks in the basic materials space are The Mosaic Company (MOS - Free Report) , AdvanSix Inc. (ASIX - Free Report) and Allegheny Technologies Incorporated (ATI - Free Report) , each sporting a Zacks Rank #1, at present.
Mosaic has a projected earnings growth rate of 106.4% for the current year. The Zacks Consensus Estimate for MOS' current-year earnings has been revised upward by 22.2% in the past 60 days.
Mosaic beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters and missed once, the average surprise being 3.7%. MOS has rallied around 87.3% in a year.
AdvanSix has a projected earnings growth rate of 30.6% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 25% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters, while missing once, the average surprise being 23.6%. ASIX has surged 57.3% in a year.
Allegheny has an expected earnings growth rate of 661.5% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised upward by 45.6% in the past 60 days.
Allegheny beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average surprise being 127.2%. ATI has rallied around 21.3% over a year.