Domtar Corp. (UFS) Downgraded to Hold at Zacks Investment Research
According to Zacks, “Domtar has a decent earnings surprise history, having beaten estimates on all occasions in the trailing four quarters. The company is seeking growth through profitable investment opportunities with a commitment to pollution-free environment and sustainable practices. The strategic acquisition of Butterfly Health is expected to further augment its global footprint in healthcare markets. Domtar is also streamlining the cost structure, improving revenue quality and maintaining a healthy cash flow with a disciplined approach to cash utilization. However, the revamped market dynamics following Brexit are expected to affect firms like Domtar, which has significant presence in the U.K., with higher tariff and non-tariff barriers to trade affecting its profitability. Global demand for pulp is also likely to be volatile due to U.S. dollar strength and consumer inventory swings, especially in China.”
UFS has been the topic of several other research reports. Bank of America Corp. raised shares of Domtar Corp. from an underperform rating to a neutral rating in a research report on Monday, October 3rd. Macquarie reduced their price target on shares of Domtar Corp. from $45.00 to $41.00 and set an outperform rating on the stock in a research report on Thursday, September 15th. TheStreet raised shares of Domtar Corp. from a hold rating to a buy rating in a research report on Wednesday, July 27th. Moffett Nathanson raised shares of Domtar Corp. from an underperform rating to a neutral rating in a report on Monday, October 3rd. Finally, Goldman Sachs Group Inc. started coverage on shares of Domtar Corp. in a report on Thursday, September 22nd. They issued a neutral rating and a $40.00 target price on the stock. Two research analysts have rated the stock with a sell rating, seven have given a hold rating and two have assigned a buy rating to the company’s stock. The stock presently has an average rating of Hold and an average target price of $39.71.
Domtar Corp. (NYSE:UFS) opened at 37.63 on Thursday. Domtar Corp. has a 52-week low of $29.88 and a 52-week high of $42.95. The firm’s 50-day moving average price is $37.05 and its 200 day moving average price is $37.69. The firm has a market cap of $2.36 billion, a PE ratio of 26.30 and a beta of 1.64.
Domtar Corp. (NYSE:UFS) last issued its quarterly earnings results on Wednesday, July 27th. The company reported $0.61 EPS for the quarter, topping the consensus estimate of $0.13 by $0.48. Domtar Corp. had a net margin of 1.74% and a return on equity of 6.84%. The business had revenue of $1.27 billion for the quarter, compared to analysts’ expectations of $1.26 billion. During the same quarter last year, the company posted $0.61 earnings per share. The company’s quarterly revenue was down 1.6% compared to the same quarter last year. On average, equities analysts anticipate that Domtar Corp. will post $2.93 earnings per share for the current year.
The firm also recently declared a quarterly dividend, which will be paid on Monday, October 17th. Stockholders of record on Monday, October 3rd will be issued a dividend of $0.415 per share. The ex-dividend date is Thursday, September 29th. This represents a $1.66 dividend on an annualized basis and a dividend yield of 4.41%. Domtar Corp.’s dividend payout ratio (DPR) is presently 116.08%.
Several large investors have recently added to or reduced their stakes in the stock. State Street Corp boosted its stake in Domtar Corp. by 0.7% in the first quarter. State Street Corp now owns 1,753,431 shares of the company’s stock worth $71,015,000 after buying an additional 12,731 shares during the period. LS Investment Advisors LLC raised its position in Domtar Corp. by 72.9% in the second quarter. LS Investment Advisors LLC now owns 3,785 shares of the company’s stock worth $133,000 after buying an additional 1,596 shares in the last quarter. CIBC World Markets Inc. raised its position in Domtar Corp. by 173.3% in the second quarter. CIBC World Markets Inc. now owns 92,139 shares of the company’s stock worth $3,226,000 after buying an additional 58,423 shares in the last quarter. Calvert Investment Management Inc. raised its position in Domtar Corp. by 35.1% in the second quarter. Calvert Investment Management Inc. now owns 8,662 shares of the company’s stock worth $303,000 after buying an additional 2,252 shares in the last quarter. Finally, BlackRock Fund Advisors raised its position in Domtar Corp. by 10.9% in the first quarter. BlackRock Fund Advisors now owns 5,636,324 shares of the company’s stock worth $228,271,000 after buying an additional 553,895 shares in the last quarter. 84.59% of the stock is currently owned by institutional investors.
Domtar Corp. Company Profile
Domtar Corporation designs, manufactures, markets and distributes a range of fiber-based products, including communication papers, specialty and packaging papers and absorbent hygiene products. The Company operates through two business segments: Pulp and Paper, and Personal Care. Its Pulp and Paper segment is engaged in the designing, manufacturing, marketing and distribution of communication, specialty and packaging papers, as well as softwood, fluff and hardwood market pulp.
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