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Based in Memphis, International Paper Company (IP) is a leading global producer of renewable fiber-based products. With a market cap of $16.9 billion, the company specializes in manufacturing corrugated packaging and pulp used in personal care items such as diapers and tissue, supporting health and wellness.
Companies valued at $10 billion or more are generally considered “large-cap” stocks, and International Paper fits this criterion perfectly. The company stands out with its strong hold on the North American corrugated packaging market, benefiting from economies of scale, a wide customer base, and an efficient distribution network.
Additionally, IP's emphasis on innovation, driven by its Long-Term Incentive Compensation Plan and its commitment to sustainability initiatives, position the company well to meet the increasing demand for environmentally conscious packaging solutions.
Despite the notable strengths, the packaging leader is currently down 4.4% from its 52-week high of $50.68, achieved on Sep. 19. Its shares are up 5.1% over the past three months, underperforming the broader IShares Global Timber & Forestry ETF’s (WOOD) 6.2% gains over the same time frame.
However, in the long term, IP is up 34% on a YTD basis, outpacing WOOD's 2.9% rise in 2024. Also, shares of IP have gained 42.2% over the past 52 weeks, compared to WOOD's 13.7% gains over the same time frame.
To validate its bullish trend, IP has been trading above its 50-day moving average since mid-August and over its 200-day moving average since early May.
IP stock saw a marginal rise on July 24 after the company reported its Q2 earnings. Although it exceeded analysts' expectations for EPS, it fell short of revenue projections, impacted by lower annual prices in its Industrial Packaging and Global Cellulose Fibers segments.
To emphasize the stock’s outperformance, IP’s rival, Packaging Corporation of America (PKG), is up 31.7% on a YTD basis. However, over the past year, PKG has soared 43.9%, surpassing IP.
Analysts are cautiously hopeful about the stock's prospects. The stock has a consensus rating of “Moderate Buy” from the nine analysts covering in coverage, and the mean price target of $49.40 suggests a potential upside of 2% from the prevailing price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
