International Paper Company [NYSE: IP] loss -0.83% or -0.46 points to close at $55.28 with a heavy trading volume of 2973555 shares. The company report on October 13, 2021 that International Paper Announces $2 Billion Share Repurchase Program; Decreases Cash Dividend 9.8% to $1.85 per Share Annually.
International Paper announced its board of directors has authorized a share repurchase program to acquire up to $2 billion of the company’s common stock. The new authorization is in addition to $1.3 billion remaining as of the end of the third quarter from a previous repurchase authorization. During the third quarter the company repurchased approximately $212 million in common stock at an average price of $59.13 per share. The company intends to continue repurchasing such shares in open market transactions. The company’s board of directors also decreased the quarterly common stock dividend by $0.05 per share or 9.8%, which brings the per share dividend to $1.85 annually.
“Returning cash to shareowners through dividends and share repurchases is a meaningful part of our capital allocation framework,” said Mark Sutton, Chairman and Chief Executive Officer. “‘s announcement reflects our confidence in International Paper’s long-term outlook and strong free cash flow generation. We are committed to a competitive and sustainable dividend of 40 to 50% of free cash flow. The dividend adjustment we are making is consistent with our dividend policy and is well below the 15 to 20% adjustment we anticipated when we announced the spin-off of our printing papers business late last year. Additionally, share repurchases will continue to complement dividends with a consistent and thoughtful cadence that’s underpinned by a commitment to maximize value creation.”.
It opened the trading session at $55.43, the shares rose to $56.569 and dropped to $54.06, the range by which the price of stock traded the whole day. The daily chart for IP points out that the company has recorded -2.45% loss over the past six months. However, it is still -30.13% lower than its most recent low trading price.
If we look at the average trading volume of 2.15M shares, IP reached to a volume of 2973555 in the most recent trading day, which is why market watchdogs consider the stock to be active.
Here is what top equities market gurus are saying about International Paper Company [IP]:
Based on careful and fact-backed analyses by Wall Street experts, the current consensus on the target price for IP shares is $67.07 per share. Analysis on target price and performance of stocks is usually carefully studied by market experts, and the current Wall Street consensus on IP stock is a recommendation set at 2.30. This rating represents a strong Buy recommendation, on the scale from 1 to 5, where 5 would mean strong sell, 4 represents Sell, 3 is Hold, and 2 indicates Buy.
Truist have made an estimate for International Paper Company shares, keeping their opinion on the stock as Hold, with their previous recommendation back on October 13, 2021. While these analysts kept the previous recommendation, Stephens raised their target price from $58 to $80. The new note on the price target was released on June 28, 2021, representing the official price target for International Paper Company stock. Previously, the target price had yet another raise to $75, while Argus analysts kept a Buy rating on IP stock.
The Average True Range (ATR) for International Paper Company is set at 1.31, with the Price to Sales ratio for IP stock in the period of the last 12 months amounting to 1.01. The Price to Book ratio for the last quarter was 2.59, with the Price to Cash per share for the same quarter was set at 14.25. Price to Free Cash Flow for IP in the course of the last twelve months was 14.12 with Quick ratio for the last quarter at 1.20.
Trading performance analysis for IP stock
International Paper Company [IP] gain into the green zone at the end of the last week, gaining into a positive trend and gaining by 2.31. With this latest performance, IP shares dropped by -4.28% in over the last four-week period, additionally sinking by -2.45% over the last 6 months – not to mention a rise of 25.61% in the past year of trading.
Overbought and oversold stocks can be easily traced with the Relative Strength Index (RSI), where an RSI result of over 70 would be overbought, and any rate below 30 would indicate oversold conditions. An RSI rate of 50 would represent a neutral market momentum. The current RSI for IP stock in for the last two-week period is set at 43.89, with the RSI for the last a single of trading hit 46.34, and the three-weeks RSI is set at 43.23 for International Paper Company [IP]. The present Moving Average for the last 50 days of trading for this stock 57.65, while it was recorded at 55.08 for the last single week of trading, and 56.67 for the last 200 days.
International Paper Company [IP]: A deeper dive into fundamental analysis
Operating Margin for any stock indicates how profitable investing would be, and International Paper Company [IP] shares currently have an operating margin of +8.56 and a Gross Margin at +24.31. International Paper Company’s Net Margin is presently recorded at +2.34.
Return on Total Capital for IP is now 7.85, given the latest momentum, and Return on Invested Capital for the company is 2.68. Return on Equity for this stock inclined to 6.19, with Return on Assets sitting at 1.48. When it comes to the capital structure of this company, International Paper Company [IP] has a Total Debt to Total Equity ratio set at 189.30. Additionally, IP Total Debt to Total Capital is recorded at 65.43, with Total Debt to Total Assets ending up at 46.88. Long-Term Debt to Equity for the company is recorded at 133.32, with the Long-Term Debt to Total Capital now at 46.08.
Reflecting on the efficiency of the workforce at the company, International Paper Company [IP] managed to generate an average of $9,777 per employee. Receivables Turnover for the company is 5.80 with a Total Asset Turnover recorded at a value of 0.63.International Paper Company’s liquidity data is similarly interesting compelling, with a Quick Ratio of 1.20 and a Current Ratio set at 1.40.
International Paper Company [IP]: An earnings per share (EPS) analysis
The progress of the company may be observed through the prism of EPS growth rate, while Wall Street analysts are focusing on predicting the 5-year EPS growth rate for IP. When it comes to the mentioned value, analysts are expecting to see the 5-year EPS growth rate for International Paper Company go to 25.83%.
An analysis of insider ownership at International Paper Company [IP]
There are presently around $17,937 million, or 84.50% of IP stock, in the hands of institutional investors. The top three institutional holders of IP stocks are: PRICE T ROWE ASSOCIATES INC /MD/ with ownership of 47,100,520, which is approximately 2.052% of the company’s market cap and around 0.10% of the total institutional ownership; VANGUARD GROUP INC, holding 45,502,847 shares of the stock with an approximate value of $2.52 billion in IP stocks shares; and BLACKROCK INC., currently with $1.85 billion in IP stock with ownership of nearly -2.333% of the company’s market capitalization.
Positions in International Paper Company stocks held by institutional investors increased at the end of October and at the time of the October reporting period, where 427 institutional holders increased their position in International Paper Company [NYSE:IP] by around 24,670,689 shares. Additionally, 408 investors decreased positions by around 18,391,653 shares, while 175 investors held positions by with 281,410,847 shares. The mentioned changes placed institutional holdings at 324,473,189 shares, according to the latest SEC report filing. IP stock had 120 new institutional investments in for a total of 4,243,139 shares, while 75 institutional investors sold positions of 2,097,353 shares during the same period.