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Domtar (UFS) Shows Promise with Focus on Holistic Growth
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On Dec 27, Zacks Investment Research updated the research report on leading paper and paper products manufacturer Domtar Corporation . This Zacks Rank #2 (Buy) stock has a solid earnings history with a trailing four quarter average earnings surprise of 76.2%. The company aims to continue this momentum in the future as well with a slew of measures for balanced organic and inorganic growth.
Domtar is seeking profitable investment opportunities with a commitment to pollution-free environment and sustainable practices. In early October, Domtar completed the acquisition of privately-held Home Delivery Incontinent Supplies Co. The strategic acquisition will expand the Personal Care segment with complementary products.
In June, Domtar acquired the assets of Butterfly Health Inc. for an undisclosed amount to augment its Personal Care segment. Headquartered in Los Gatos, CA, Butterfly Health is a small consumer packaged goods company that is focused on health and wellness. The company offers body liners for accidental bowel leakage which is common in many heath conditions. The company provides discreet personal hygiene products for both women and men.
Such opportune acquisitions will enable Domtar to expand its geographical footprint, while strengthening top-line growth. However, the stock has underperformed the Zacks categorized Paper & Paper Products industry in the last month with an average return of 3% compared with 6.4% for the latter.
In order to revive its growth trajectory, the company is streamlining the cost structure, improving revenue quality and maintaining a healthy cash flow with a disciplined approach to cash utilization. In addition, Domtar is optimizing its operations related to fluff pulp production at its Plymouth mill in North Carolina. Fluff pulp is bleached softwood cellulose fiber and is primarily used across the globe for absorbent applications in baby diapers, feminine hygiene and adult incontinence products.
The restructuring process includes the permanent closure of the small pulp dryer facility and phasing out of the related assets. Simultaneously, Domtar intends to reduce the excess workforce by about 100 positions to right-size the employee count for optimum utilization of resources. The company has set an annualized production target of approximately 380,000 metric tons of fluff pulp for the Plymouth mill, including the manufacture of Lighthouse Fluff, the benchmark grade for high-quality fluff pulp. Domtar expects the entire restructuring process to be completed by mid-2017.
AK Steel has beaten estimates in each of the trailing four quarters for an average earnings surprise of 170.8%.
Gerdau is trading at a forward P/E (F1) of 63.6x.
Israel Chemicals has beaten estimates twice in the trailing four quarters for an average positive earnings surprise of 15.3%.
Zacks' Top 10 Stocks for 2017
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Domtar (UFS) Shows Promise with Focus on Holistic Growth
On Dec 27, Zacks Investment Research updated the research report on leading paper and paper products manufacturer Domtar Corporation . This Zacks Rank #2 (Buy) stock has a solid earnings history with a trailing four quarter average earnings surprise of 76.2%. The company aims to continue this momentum in the future as well with a slew of measures for balanced organic and inorganic growth.
Domtar is seeking profitable investment opportunities with a commitment to pollution-free environment and sustainable practices. In early October, Domtar completed the acquisition of privately-held Home Delivery Incontinent Supplies Co. The strategic acquisition will expand the Personal Care segment with complementary products.
In June, Domtar acquired the assets of Butterfly Health Inc. for an undisclosed amount to augment its Personal Care segment. Headquartered in Los Gatos, CA, Butterfly Health is a small consumer packaged goods company that is focused on health and wellness. The company offers body liners for accidental bowel leakage which is common in many heath conditions. The company provides discreet personal hygiene products for both women and men.
Such opportune acquisitions will enable Domtar to expand its geographical footprint, while strengthening top-line growth. However, the stock has underperformed the Zacks categorized Paper & Paper Products industry in the last month with an average return of 3% compared with 6.4% for the latter.
In order to revive its growth trajectory, the company is streamlining the cost structure, improving revenue quality and maintaining a healthy cash flow with a disciplined approach to cash utilization. In addition, Domtar is optimizing its operations related to fluff pulp production at its Plymouth mill in North Carolina. Fluff pulp is bleached softwood cellulose fiber and is primarily used across the globe for absorbent applications in baby diapers, feminine hygiene and adult incontinence products.
The restructuring process includes the permanent closure of the small pulp dryer facility and phasing out of the related assets. Simultaneously, Domtar intends to reduce the excess workforce by about 100 positions to right-size the employee count for optimum utilization of resources. The company has set an annualized production target of approximately 380,000 metric tons of fluff pulp for the Plymouth mill, including the manufacture of Lighthouse Fluff, the benchmark grade for high-quality fluff pulp. Domtar expects the entire restructuring process to be completed by mid-2017.
Some other favorably ranked stocks in the industry include AK Steel Holding Corporation , Gerdau S.A. (GGB - Free Report) and Israel Chemicals Ltd. (ICL - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
AK Steel has beaten estimates in each of the trailing four quarters for an average earnings surprise of 170.8%.
Gerdau is trading at a forward P/E (F1) of 63.6x.
Israel Chemicals has beaten estimates twice in the trailing four quarters for an average positive earnings surprise of 15.3%.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>