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Clearwater Paper (NYSE:CLW) +19.8% to a 20-month high in Wednesday’s trading after Q2 earnings swung to a profit and revenues jumped 30% Y/Y to a stronger than expected $526M.
Q2 net income came in at a $14.7M profit, or $0.86/share, compared with last year’s loss of $51.6M, or a $3.10/share loss, citing continued strength in paperboard and improvements in tissue.
The company said it cut net debt by $68M in the quarter and by nearly $100M so far this year.
The Q2 results prompted RBC Capital to upgrade shares to Outperform from Sector Perform with a $45 price target, raised from $40, “driven by realization of prior price increases.”
“We see a path to stronger share price performance, particularly on the back of an upcoming refresh of the company’s capital allocation plans, with continued strong results from the Pulp & Paperboard business and price realizations helping to improve economics in the Consumer Products business,” RBC’s Paul Quinn wrote.
Clearwater Paper (CLW) shares have gained 13% YTD and 45% during the past year.
