Resolute Forest Products (RFP) Company Overview & Stock Price Forecast
This article provides a brief analysis and stock rating for Resolute Forest Products (RFP) including an updated stock price target. Additional data on the company’s earnings yield, price/earnings ratio, return on invested capital and YTD performance are discussed as well.
Resolute Forest Products Fundamentals
Stock Price Target: $19.05
In the section below, we discuss the earnings yield, P/E, return on invested capital and YTD performance for Resolute Forest Products in comparison to the Paper/Forest Product industry and the S&P 500.
Resolute Forest Products is a Small Cap company with a Market Cap of $360M.
| Resolute Forest | Paper/Forest Ind. | S&P 500 | T-Bill (10Y) |
|---|---|---|---|
| 30.76% | 11.97% | 2.94% | 1.61% |
The current earnings yield for Resolute Forest is 30.76%, in comparison to 2.94% for the S&P 500 and 1.61% for the 10-year treasury bond. The median earnings yield for the Paper/Forest Ind. industry is 11.97%.
| Resolute Forest | Paper/Forest Ind. | S&P 500 |
|---|---|---|
| 2.92 | 3.96 | 34.01 |
Resolute Forest is currently trading at a P/E of 2.92. The P/E for the Paper/Forest Ind. industry is 3.96 and the P/E for the S&P 500 is 34.01.
| Resolute Forest | Paper/Forest Ind. | S&P 500 |
|---|---|---|
| 0.37 | 0.74 | 3.09 |
Resolute Forest is currently trading at a P/S of 0.37. The P/S for the Paper/Forest Ind. industry is 0.74 and the P/S for the S&P 500 is 3.09.
| Resolute Forest | Paper/Forest Ind. | S&P 500 |
|---|---|---|
| 0.91 | 1.61 | 4.58 |
Resolute Forest is currently trading at a P/B of 0.91. The P/B for the Paper/Forest Ind. industry is 1.61 and the P/B for the S&P 500 is 4.58.
Return on Invested Capital (ROIC)
| Resolute Forest | Paper/Forest Ind. | S&P 500 |
|---|---|---|
| 19.65% | 21.65% | 8.6% |
Resolute Forest ROIC is currently 19.65% in comparison to 21.65% for the Paper/Forest Ind. industry and 8.6% for the S&P 500.
| Resolute Forest | Paper/Forest Ind. | S&P 500 |
|---|---|---|
| 130.80% | – | 17.14% |
The YTD performance for Resolute Forest is 113.81% in comparison to the YTD S&P 500 performance of 17.14%.
Recent Financial Results
- Operating income of $406M Q2 2021, compared to $177M in Q1 2021
- Improvement from higher selling prices ($500M) in the wood products, pulp and paper segments offset by the stronger Canadian dollar
- EBITDA for Q2 2021 $408M higher than the Q2 2020
- $401M cash from operating activities in Q2 2021
- Company repaid $180M of debt in the quarter
- This was the total amount outstanding under the company’s revolving and term credit facilities, leaving only the $300M of unsecured 4.875% senior notes due 2026
- Repurchased 343K at an average price of $11.21 and also declared a special cash dividend of $1 per share of common stock ($79M in aggregate)
Stock Price Target: $19.05
Company Overview
Resolute Forest Products operates in the forest products industry in the US and internationally. The company operates through four segments: Market Pulp, Tissue, Wood Products, and Paper.
The Market Pulp segment focuses on providing virgin and recycled bleached kraft pulp, which is used to make a range of consumer products, including tissue, packaging and diapers.
The Tissue segment provides various tissue products, such as recycled and virgin paper products for retail markets.
The Wood Products segment produces construction-grade and spruce-pine-fir lumber products and wood chips for pulp and paper mills and the construction industry.
The Paper segment provides newsprint to newspaper publishers and commercial printers, for a variety of uses like inserts and flyers. This segment also provides various uncoated mechanical papers used by commercial printers, direct mailers, publishers and retailers. The company also produces electricity at six cogeneration facilities and seven hydroelectric dams.
Resolute Forest Products was founded in 1820 and is headquartered in Montreal, Canada. The current CEO is Remi Lalonde.
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This material is provided for informational purposes only and is not financial advice. The information contained herein should not solely be used for the formation of an investment decision, whether you are a long term or short term investor.