UPDATE: Goldman Sachs Starts International Paper (IP) at Neutral
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(Updated - September 22, 2016 9:13 AM EDT)
Goldman Sachs initiated coverage on International Paper (NYSE: IP) with a Neutral rating and a price target of $49. Analyst Brian Maguire is cautious given pricing and pension concerns.
'While we like management’s long-term focus on optimizing the asset portfolio, improving ROIC, and returning cash to shareholders, our Neutral rating reflects our neutral to slightly negative view of containerboard (63% of total EBITDA), boxboard/SBS (9%), and pulp (8%). Furthermore, IP’ s $4.2bn unfunded pension liability has the potential to consume significant amounts of cash in the near-term that makes its relative valuation less attractive than it otherwise would appear to be," said the analyst.
Shares of International Paper closed at $48.49 yesterday.
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