I think Clearwater Paper's common equity is conservatively worth somewhere between $25 and $35 per share, based on earnings power and free cash flow. In addition, the company is likely to receive refundable tax credits this year equal to $14 per share pre-tax. They have already been approved for and received the first $16.7 million, or $1.45 per share, for a five week period from late January through February.

Q4 2008 Earnings Call

February 10, 2009 11:00 AM ET

My wife, Jessica Lo, and I recently had the occasion to be introduced to Tony Blair. It was our first time meeting him, and I must say he is incredibly charismatic. He commands attention and confidence in him in a way few, even the most polished politician we know, can garner. He is quite opposite to Larry Summers or Chen Shui-Bian as I have written before for Seeking Alpha.

We had a nice discussion with Mr. Blair on Chinese youth and how their optimism and confidence will help propel changes in China in both the business and political arenas in a good way. As China's economy begins to waver from the financial crisis, much of its future lies with Chinese youth who will become the major drivers for growth and how they react to a downturn. If they continue spending, then domestic consumption will be able to take up 50% of the economy vs. the 1/3 now as we predict will happen in the next 5 years. Or, if their salary and bonus increases are not realized during the Chinese New Year period, then retail sales will be hit hard in February and March and fall the way exports have as they cut back on spending.

Retailers are saying they will be upping their marketing dollars for the holiday season, especially the mid-to-lower range retailers. The increased marketing spend in Q4 is somewhat surprising - and may mean some unexpected upside for ad agencies and ad-dependent media outlets in Q4.

For my explanation on pair trading, please see here.

Paper & Paper Products Industry

The paper products industry covers the manufacture of paper and paperboard from wood pulp. The industry also includes the production of finished paper and cardboard products, such as paper bags, paper boxes, stationery, tissues, and envelopes. Packaging products represent a significant portion of the industry. The US share of this global market is shrinking as competition from Europe and Asia heats up. There is a huge motion politically and economically to go “paperless”, and although this can never happen, the move towards this will continue to hurt the paper product companies. Production costs are subsiding as fiber and energy costs come down, which could provide some short-term relief for many of these companies. The slowing economy hurts demand across all segments of the industry, and FedEx is a great indicator of this, as global shipping figures have come down substantially. The brighter outlook is that online shopping is seeing growth which does help the paper industry due to more shipping in paper boxes required.

Q3 2008 Earnings Call Transcript

October 28, 2008, 11:00 am ET

• Bigger profits for BP. BP (BP) reported Q3 results this morning, including a better-than-expected 83% rise in quarterly net profit thanks to higher oil prices. Net profit for Q3 totalled $8.05B, as compared to $4.41B a year earlier, and beat estimates of $6.78B. Revenue rose to $104.8B from $72.8B. The company's underlying rise in production, adjusting for fluctuations in oil price, was 5% on the year. Shares +7.0% pre-market.
• Financial crisis saps SAP. This morning, SAP AG (SAP) released Q3 earnings far short of analyst expectations (see below). The world's largest maker of business-management software also withdrew its 2008 sales forecast and lowered its profit-margin target in light of the global economic downturn. The adjusted operating margin will be around 28% vs. earlier forecasts of 28.5%-29%. SAP will also cut R&D spending, freeze hiring and curb travel expenses. Shares -7.7% in German trading.
• 5,000 layoffs at Whirlpool. Whirlpool (WHR), the world's largest appliance maker, will eliminate 5,000 jobs by the end of 2009 to cut costs amid reduced demand and a global credit crisis. "We are in the midst of a rapidly changing and very challenging economic environment. We have seen a sharp drop in demand in North America and Europe during the third quarter, and we do not expect demand conditions to improve in the near term," CEO Jeff Fettig said. "The global credit crisis has had a profound negative impact on what was already a weakening and very fragile global economy. Declining home values, rising unemployment and very low consumer confidence levels will likely prolong a negative demand environment at least through the middle of 2009." Along with factory closings, the moves will produce $275M/year in savings.
• Banks balk on Huntsman sale. Chemical producer Huntsman (HUN) has been informed by Hexion that its proposed $5.6B, $28/share buyout will not close today because the banks that were to fund the deal - Deutsche Bank (DB) and Credit Suisse (CS) - no longer plan to do so. Hexion is trying to "resolve the banks' concerns and is still seeking to close the merger," Huntsman said. Hexion previously tried to break off the deal, but was ordered by a Delaware court to proceed.
• Government may broker GM/Chrysler deal. There is a push within the government to release some of the $25B in auto-industry-earmarked Treasury funds, sources say, a move that could send ongoing merger talks between GM (GM) and Chrysler into high gear. A possible $5B loan, toward the $10B the pair would need to deal with layoffs and plant closures, would come from a $25B pool of low-interest loans being administered by the Energy Department. The money was originally intended to speed the availability of fuel-saving technologies. On Monday Moody's downgraded the pair, saying "GM's liquidity profile will continue to erode in 2009" even with the government program.
• GE borrows Fed funds. General Electric (GE) tapped the Federal Reserve's new commercial-paper facility, borrowing under $5B yesterday when the facility debuted. With $88B in short-term loans, GE is the largest borrower in the $1.5T commercial-paper market. Though the company has managed to meet its funding needs, market turmoil has forced up GE's borrowing costs, providing GE with a vested interest in making sure the Fed's new facility is effective. GE and its financial services arm are eligible to borrow up to $96B from the new Fed program.
• Volkswagen takes pole position. Volkswagen (VLKAY.PK) surpassed ExxonMobil (XOM) to become the world's biggest company by market cap after Porsche announced plans to raise its stake in the German carmaker to 75% from 42.6%, triggering a short squeeze. Shares rose as much as 93% yesterday, and were up another 55% in Frankfurt this morning, bringing its market value to €296B ($370) vs. Exxon's $343B. As of Oct. 23, almost 13% of Volkswagen's shares were on loan, mostly to short sellers who were forced to swallow massive losses and exit their positions. "Volkswagen has been one of the greatest shorts of hedge funds, and it's been an absolute, absolute disaster," GLG Partner's Emmanuel Roman said. Elsewhere around the globe, carmakers are struggling with plunging sales and a lack of cash.
• Markets rally, Treasurys drop. U.S. Treasurys fell in overnight trading (see below) as global markets rallied, and as it becomes clear the government needs to borrow enormous amounts of money to help pay for its costly financial rescue framework. "Increasing supply will help push up yields," Credit Suisse fixed income strategist Rasmus Rousing said. "We're also seeing a slight reversal of stock-market declines of the last few days (see below) and that's helping to take some buying interest out of Treasurys." Today's record $34B note auction could be a tough sell.
• Rescue plan hits a snag. The $700B financial rescue plan is being delayed due to difficulties in hiring asset managers to oversee the program. On Oct. 3 the Treasury said it would quickly hire asset managers so that the program could be up and running within a few weeks. Sources say hurdles include issues over the fees the government will pay asset managers and a lack of manpower at Treasury. They also say Allianz's (AZ) Pimco will likely be named as an asset manager. Fees could be about 0.15% to 0.20% of assets under management, compared to a more typical 0.35%. The longer the delay, the greater the risk investors will lose confidence in the plan's efficacy.
• Barclays in talks with Russia banks for capital boost. Barclays (BCS) is seeking investments from two state-backed Russian banks - OAO VTB and OAO Sberbank - in an effort to boost its capital. Barclays plans to raise £6.5B ($10.34B) from private sources to meet government capital requirements, rather than accepting government largesse which comes with limitations such as a limit of dividends.
• Google strikes back against Viacom. Google (GOOG) fired back against Viacom (VIA) in its $1B lawsuit by demanding the internal records of copyright police service BayTSP Inc. Google alleges the documents will refute Viacom's assertion it's uncapable of monitoring improper use of its content; will demonstrate Viacom routinely uploaded its own content to Google's YouTube; and that BayTSP "remained silent" about copyright infringement for a months-long period in late 2006, then deluged it with more than 100,000 requests to take down infringing material in a single day as a prelude to Viacom's lawsuit. Viacom is suing Google for more than $1B; Google argues it isn't legally liable for copyrighted material uploaded to YouTube.
• September new home sales rose slightly to 464K/year vs. 450K consensus. Sales are up 2.7% from August's revised data, but are down 33.1% Y/Y.

Earnings: Tuesday Before Open

• Amedisys (AMED): Q3 EPS of $0.89 beats by $0.07. Revenue of $322M (+77.7%) vs. $312M. [PR]
• Ashland (ASH): FQ4 EPS of -$0.01 misses by $0.31. Revenue of $2.2B (+6.3%) in-line. [PR]
• Boyd Gaming (BYD): Q3 EPS of $0.16 misses by $0.03. Revenue of $426M (-13.0%) vs. $440M. [PR]
• BP (BP): Q3 net profit of $8.05B vs. $6.78B. Revenue of $104.8B vs. $72.8B last year.
• Check Point Software Technologies (CHKP): Q3 EPS of $0.44 beats by $0.01. Revenue of $200M (+8.5%) in-line. [PR]
• EarthLink (ELNK): Q3 EPS of $0.49 beats by $0.09. Revenue of $231M (-22.6%) vs. $230M. [PR]
• Entergy (ETR): Q3 EPS of $2.50 misses by $0.02. Revenue of $3.96B (+20.5%) vs. $3.86B. [PR]
• Health Management Associates (HMA): Q3 EPS of $0.07 misses by $0.01. Revenue of $1.1B (+3.4%) in-line. [PR]
• Interpublic Group of Companies (IPG): Q3 EPS of $0.08 beats by $0.02. Revenue of $1.74B (+11.5%) vs. $1.65B. [PR]
• Masco (MAS): Q3 EPS of $0.10 misses by $0.09. Revenue of $2.5B (-15.9%) in-line. [PR]
• SAP AG (SAP): Q3 EPS of $0.41 misses by $0.16. Revenue of $2.8B (+15.8%) vs. $4.0B. [PR]
• Smith International (SII): Q3 EPS of $1.01 beats by $0.04. Revenue of $2.85B (+26.9%) vs. $2.71B. [PR]
• Whirlpool (WHR): Q3 EPS of $2.15 beats by $0.46. Revenue of $4.90B (+1.3%) vs. $5.0B. [PR]

Earnings: Monday After Close

• Atheros Communications (ATHR): Q3 EPS of $0.37 beats by $0.02. Revenue of $138M in-line. Shares +3.8%. (PR)
• Buffalo Wild Wings (BWLD): Q3 EPS of $0.25 misses by $0.06. Revenue of $106M vs. $104M. Shares -13.9%. (PR)
• Choice Hotels International (CHH): Q3 EPS of $0.57 beats by $0.01. Revenue of $179M vs. $191M. Shares -2.9%. (PR)
• Parexel International (PRXL): FQ1 EPS of $0.23 beats by $0.01. Revenue of $320M vs. $274M. Sees FQ2 EPS of $0.18-0.20 vs. $0.27. Shares -13.1%. (PR)
• Rent-A-Center (RCII): Q3 EPS of $0.44 misses by $0.48. Revenue of $709M vs. $700M. Sees Q4 revenue of $698-713M vs. $721M. Shares -9.6%. (PR)
• Texas Roadhouse (TXRH): Q3 EPS of $0.12 misses by $0.01. Revenue of $218M in-line. Shares -4.6%. (PR)
• Universal Health Services (UHS): Q3 EPS of $0.73 misses by $0.04. Revenue of $1.24B in-line. (PR)
• Wausau Paper (WPP): Q3 EPS of $0.08 beats by $0.02. Revenue of $312M in-line. (PR)
• WMS Industries (WMS): FQ1 EPS of $0.27 beats by $0.02. Revenue of $151M vs. $148M. (PR)

Today's Markets

• Asia markets posted a strong comeback, led by Hong Kong +14.35% to 12,596. Nikkei +6.41% to 7622. Shanghai +2.81% to 1772. BSE Sensex closed.
• In Europe at midday, gains across the board. London +2.4%. Paris +2.6%. Frankfurt +5.8% led by Volkswagen.
• U.S. futures are back at yesterday's pre-late-day-selloff levels. Dow +4.3% to 8353. S&P +4.5%. Nasdaq +4%.
• Crude +11.9% to $64.42. Gold +0.2% to $743.
• 30-year bond -0.77%. 10-year not -0.61%. 5-year -0.36%. 2-year -0.08%.

Tuesday's Economic Calendar

• FOMC meeting begins
  7:45 ICSC Retail Store Sales
  8:55 Redbook
  9:00 S&P/Case-Shiller Home Price Index
  10:00 Consumer Confidence
  10:00 Richmond Fed's Manufacturing Index
  10:45 Treasury's Paulson speaks on capital markets
  5:00 PM ABC Consumer Confidence Index
• Notable earnings before Tuesday's open: AMED, ASH, BP, BYD, CHKP, CVG, EL, ELNK, ETR, FMER, HMA, IPG, KSU, MAS, MHP, OXY, RCL, SAP, SCHN, SEPR, SII, TIN, UA, USG, VLO, VSH, WDR, WHR, X
• Notable earnings after Tuesday's close: ACE, ALGN, AMX, APOL, ARRS, BMRN, BXP, CBI, CEPH, CPHD, CTX, DRIV, DWA, EAC, FISV, FLS, FMC, LNC, MCK, MOLX, MTW, NLC, PMTC, RFMD, STM, WLT, WRB, XRAY

Seeking Alpha editor Rachael Granby contributed to this post.

Q2 2008 Earnings Call

July 29, 2008 11:00 am ET

Q2 2008 Earnings Call

July 29, 2008 11:00 am ET

• Mars sends Wrigley into Orbit. Privately-held Mars and Warren Buffet's Berkshire Hathaway (BRK.A) are taking Wrigley (WWY) private for about $23B. The $80/share price is a 28% premium. Key to the deal is increased global distribution of their combined product lines, they said. Mars will make Wrigley a largely independent subsidiary, leaving its management to run things, but there is still likely plenty of room to exploit cost synergies and increase clout with key suppliers. Buffett said he decided to enter the deal because he loves the companies' foods. He called Berkshire a "very junior partner," although it is putting up $6.5B. The FTC is likely to rubber-stamp the deal.
• Deutsche Bank swings to loss. Deutsche Bank (DB) reported its first quarterly loss in five years; it lost €131M on revenue of €4.6B (-52%). Trading losses were €1.58B vs. a €3.97B gain a year ago. Writedowns of €2.7B included €1.77B on leveraged loans and €885M on real-estate debt (commercial and residential). DB forecast a €2.5B writedown less than a month ago. "In the month of March, pressure on the banking sector was more intense than at any time since the current credit downturn began. Inevitably, this left its mark on Deutsche Bank's results," CEO Josef Ackermann said. Shares are down 1.1% in pre-market trading.
• Visa shares slump despite solid beat. Shares of Visa (V) fell 6.1% in extended trading despite a 28% jump in profit in the company's first quarter as a public company. Adjusted FQ2 EPS of $0.52 beat consensus of $0.45. Revenue of $1.45B (+22%) was in line. Visa sees yearly revenue growth at a milder 11-15% and EPS growth of 20% or more. "Expectations for Visa, because of the overdone run-up in the stock price, were likely beyond what Visa could have reached," Caylon's Craig Maurer said. On its conference call, Visa said it sees no discernible trend of a softer U.S. economy meaningfully affecting payment volumes, and that its Q2 was ahead of its internal budget projections.
• Shell, BP report gusher profits. BP (BP) and Royal Dutch Shell (RDS.A) soared in London trading Tuesday after the duo reported record profits, hardly surprising considering the sky-high price of oil. Q1 income at Shell jumped 25% to $9.08B sending its shares up 6%. Profits at BP soared 63% to $7.62B; its shares rose 5.8%. ConocoPhillips (COP) reported a 17% jump in profits on Apr. 24. ExxonMobil (XOM) reports May 1, and Chevron (CVX) a day later. Expect more of the same.
• Kerkorian kicks Ford's tires. Kirk Kerkorian's Tracinda Corp. disclosed a 4.7% stake in Ford Motor (F), and wants to boost its stake to 5.6% through a $8.50/share tender offer -- a 13% premium to Friday's close. Kerkorian said he's pleased with Ford's progress to cut costs and refocus. "We have a lot of confidence in him," an adviser said. Kerkorian is famous for trying to muscle a management change at GM (GM); he says he has no such plans with his foray into Ford. Shares gained 9.5%.
• Fed looks to take charge. Regulators are planning a crackdown on credit-card issuers amid criticism of hidden fees and unfair interest rate hikes. The banking industry, as one might expect, is girding its loins for a fight. Proposals include curbing fees on overdrawn bank accounts; making it harder for firms to hike interest rates due to a drop in customers' credit ratings; and changing the way companies apply payments to outstanding balances.
• Blockbuster wants stake in new TV channel. Sources say Blockbuster (BBI) is negotiating with Viacom (VIA) to take a stake in its new pay-TV channel, a JV between VIA, MGM (MGM) and Lions Gate Entertainment (LGF). Blockbuster was once owned by Viacom. A BBI spokeswoman had this to say: "We are busy transforming Blockbuster into a multiplatform provider of convenient access to media entertainment. To that end, we're exploring our options so it's not surprising there are rumors out there."
• Extra, extra, read all about it (online). Circulation fell at most large U.S. newspapers according to data from the Audit Bureau of Circulations. Over the past three semi-annual reporting periods, circulation decline has gone from 2.1% to 2.6% to a current 3.6%. Sunday circulation is down 4.6%. At the Times (NYT), circulation was down 3.9%, and a whopping 9.3% on the Sunday edition. Gannett's (GCI) USA Today posted a 0.3% increase, and WSJ (NWS) inched up 0.4%.
• Big bear blunder. Former Fed head of monetary affairs Vincent Reinhart says the Fed's bailout of Bear Stearns was "the worst policy mistake in a generation." He said it "eliminated forever the possibility the Fed could serve as an honest broker."

Earnings

• Archer Daniels (ADM): FQ3 EPS of $0.80 beats consensus of $0.70. Revenue of $18.7B vs. consensus of $13.45B!
• Avon (AVP): Q1 EPS of $0.47 beats consensus of $0.44. Revenue of $2.5B vs. consensus of $2.43B.
• Boyd Gaming (BYD): Q1 EPS of $0.34 beats consensus of $0.32. Revenue of $471M vs. consensus of $484M.
• CBS Corp. (CBS): Q1 EPS of $0.43 beats consensus of $0.33. Revenue of $3.7B vs. consensus $3.55B.
• Corning (GLW): Q1 EPS of $0.44 beats consensus of $0.42. Revenue of $1.62B in line. Sees Q2 EPS of $0.47-$0.50, better than consensus of $0.43.
• Daimler AG (DAI): Q1 EPS of €1.29, EBIT of €1.98B and net profit of €1.33B.
• Domino's Pizza (DPZ): Q1 EPS of $0.21 misses consensus of $0.24. Revenue of $339M vs. consensus of $351M.
• Enbridge Energy Partners (EEP): Q1 EPS of $0.99 beats consensus of $0.75. Revenue of $2.435B vs. consensus of $2.07B.
• Fresh Del Monte (FDP): Q1 EPS of $1.07 beat consensus of $1.02. Q1 revenue of $895M vs. consensus of $903M.
• Lear (LEA): EPS of $1.00 more than doubles consensus of $0.48. Revenue of $3.9B vs. consensus of $3.59B. Sees 2008 revenue of $15.5B vs. consensus of $14.8B.
• Masco (MAS): Q1 EPS of $0.01 badly misses consensus of $0.21. Revenue of $2.45B vs. consensus of $2.52B. Lowers 2008 EPS view to $0.50-0.64 from $0.85-1.15, vs consensus of $1.03. Shares are down 7.7% in pre-market trading.
• McGraw Hill (MHP): Q1 EPS $0.25 beats consensus of $0.23. Revenue of $1.22B in line. Sees 2008 EPS of $2.65-2.75, missing consensus of $2.85.
• Medco Health (MHS): Q1 EPS of $0.55 beats consensus of $0.53. Revenue of $12.96M vs. consensus $12.25B. Sees 2008 EPS of $2.27-$2.31 vs. consensus of $2.30.
• Office Depot (ODP): Q1 EPS of $0.25 beats consensus of $0.24. Revenue of $3.96B vs. consensus of $4.08B.
• Penske Automotive (PAG): Q1 EPS of $0.36 beats consensus of $0.33. Revenue of $3.2B in line. Sees 2008 EPS of $1.63-1.71, better than consensus of $1.65.
• STMicroelectronics (STM): Q1 EPS of $0.13 misses consensus of $0.18. Revenue of $2.5B in line.
• Taiwan Semi (TSM): Q1 EPS of $0.17 vs. consensus of $0.16. Revenue of $2.77B in line.
• TheStreet.com (TSCM): Q1 EPS of $0.07 misses consensus of $0.10. Revenue of $18.9M vs. consensus $19.95M. Subscription revenue was down 2% to $8M, while ad revenue increased 18% to $5.1M.
• US Steel (X): Q1 EPS of $1.98 beats consensus of $1.82. Revenue of $5.2B vs. consensus of $5.09B.
• Valero Energy (VLO): Q1 EPS of $0.48 beats consensus of $0.29. Revenue of $27.94B vs. consensus of $18.23B!
• Wausau Paper (WPP): Q1 EPS of -$0.06 misses consensus of -$0.02. Revenue of $299M vs. consensus of $285M. Sees Q2 EPS flat, worse than consensus of $0.03.

Today's Markets

• In Asia, the Hang Seng gained 0.97%, Shanghai was up 1.40%, and the BSE Sensex gained 2.13%. Tokyo was closed.
• In Europe Tuesday, markets were mainly lower at midday. FTSE +0.3%. CAC -0.37%. DAX -0.73%.
• U.S. futures are down about 0.3% at 7:00 AM.

Wausau Paper Corp. (WPP)

Q4 2007 Earnings Call

February 5, 2008 11:00 am ET

Wausau Paper Corp. (WPP)

Q4 2007 Earnings Call

Bullish calls:

Top 100 Financial Advisers by Suzanne McGee