Unconventional Capital Wisdom
Value, long-term horizon, worldly wisdom, growth at reasonable price

Forget BlackBerry: Watsa's Resolute Forest Products Investment Gets More Bang For Your Buck

Executive Summary

• Bankruptcy and years of losses has totaled over $2 billion in deferred tax assets and management's focus on profitability will unlock deferred tax asset over the next 20 years

• Huge pension deficit is disappearing as interest rate/discount rate rises

• Liquidation value with another 100 bps increase in pension discount rate would mean liquidation valued downside of only 6%

• Management agrees the company is undervalued and bought back $67 million worth of shares in 2012 and has another $33 million available to buyback.

• Industry is in cyclical downturn and paper is in secular decline, but rising housing starts, better pricing inputs and cost saves will add significantly to RFP's EBITDA

• Trading significantly below...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details