International Paper (NYSE:IP) Shares Gap Down After Earnings Miss

Key Points

• International Paper shares gapped down after reporting Q1 EPS of $0.15 versus the $0.19 consensus, opening at $31.59 after a prior close of $33.58 and last trading near $30.24 on heavy volume.
• Analysts have trimmed targets and ratings—UBS, JPMorgan and BNP Paribas cut price objectives and Zacks moved to a "strong sell"—yet the consensus remains a "Hold" with an average price target of $45.48, well above the current share price.
• Despite the earnings miss, insiders including CEO Andrew K. Silvernail and a director purchased shares recently, with insiders buying 76,092 shares (~$3.0M) in the last 90 days, though insiders still own only 0.21% of the company.

International Paper Company (NYSE:IP - Get Free Report) shares gapped down prior to trading on Thursday following a weaker than expected earnings announcement. The stock had previously closed at $33.58, but opened at $31.59. International Paper shares last traded at $30.2380, with a volume of 2,196,942 shares changing hands.

The basic materials company reported $0.15 EPS for the quarter, missing the consensus estimate of $0.19 by ($0.04). International Paper had a negative net margin of 14.12% and a negative return on equity of 0.35%. During the same quarter in the prior year, the firm posted $0.17 EPS. The business's revenue was up 13.4% on a year-over-year basis.

Analyst Upgrades and Downgrades

A number of research firms have recently commented on IP. UBS Group reduced their price objective on shares of International Paper from $44.00 to $40.00 and set a "neutral" rating for the company in a research note on Friday, April 10th. Zacks Research cut shares of International Paper from a "hold" rating to a "strong sell" rating in a report on Thursday, April 23rd. BNP Paribas Exane lowered their price objective on International Paper from $44.00 to $42.00 and set an "outperform" rating on the stock in a research report on Wednesday, March 25th. JPMorgan Chase & Co. lowered their target price on shares of International Paper from $48.00 to $46.00 and set a "neutral" rating on the stock in a report on Thursday, April 2nd. Finally, Jefferies Financial Group increased their price target on shares of International Paper from $47.00 to $48.00 and gave the stock a "buy" rating in a research report on Thursday, January 22nd. Eight equities research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and two have issued a Sell rating to the company's stock. According to data from MarketBeat.com, the company presently has an average rating of "Hold" and a consensus price target of $45.48.

Insider Buying and Selling at International Paper

In other International Paper news, CEO Andrew K. Silvernail purchased 50,000 shares of the company's stock in a transaction dated Friday, January 30th. The stock was purchased at an average price of $39.98 per share, with a total value of $1,999,000.00. Following the completion of the purchase, the chief executive officer owned 50,000 shares of the company's stock, valued at approximately $1,999,000. The trade was a ∞ increase in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this link. Also, Director Anders Gustafsson purchased 13,217 shares of the company's stock in a transaction dated Thursday, March 12th. The shares were acquired at an average cost of $37.83 per share, with a total value of $499,999.11. Following the purchase, the director directly owned 26,092 shares of the company's stock, valued at approximately $987,060.36. The trade was a 102.66% increase in their position. The disclosure for this purchase is available in the SEC filing. Insiders have bought 76,092 shares of company stock valued at $2,999,064 in the last ninety days. Insiders own 0.21% of the company's stock.

Hedge Funds Weigh In On International Paper

A number of hedge funds have recently bought and sold shares of the company. Ascentis Independent Advisors bought a new position in International Paper during the first quarter worth $28,000. Stephens Inc. AR raised its stake in International Paper by 1.3% during the first quarter. Stephens Inc. AR now owns 23,032 shares of the basic materials company's stock worth $853,000 after buying an additional 298 shares during the last quarter. Parrish Capital LLC raised its stake in International Paper by 7.5% during the first quarter. Parrish Capital LLC now owns 35,032 shares of the basic materials company's stock worth $1,251,000 after buying an additional 2,447 shares during the last quarter. Cherokee Insurance Co raised its stake in International Paper by 2.3% during the first quarter. Cherokee Insurance Co now owns 223,400 shares of the basic materials company's stock worth $7,975,000 after buying an additional 5,000 shares during the last quarter. Finally, QRG Capital Management Inc. raised its stake in International Paper by 4.7% during the first quarter. QRG Capital Management Inc. now owns 93,621 shares of the basic materials company's stock worth $3,342,000 after buying an additional 4,207 shares during the last quarter. Institutional investors own 81.95% of the company's stock.

International Paper Price Performance

The business's 50 day moving average is $37.58 and its two-hundred day moving average is $40.19. The firm has a market cap of $16.32 billion, a P/E ratio of -4.57 and a beta of 1.14. The company has a quick ratio of 1.02, a current ratio of 1.28 and a debt-to-equity ratio of 0.60.

About International Paper

International Paper is a global producer of renewable fiber-based products, focused primarily on pulp, paper, and packaging. The company manufactures containerboard and corrugated packaging used for shipping and retail display, as well as a range of specialty papers and pulp products that serve industrial, consumer goods, and e-commerce customers. Its product portfolio is oriented toward large-scale packaging solutions, tissue and paper grades, and raw pulp for a variety of manufacturing uses.

Founded in 1898, International Paper is headquartered in Memphis, Tennessee, and is one of the largest and longest-established companies in the forest products sector.

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