Domtar Corporation (UFS) Upgraded by Zacks Investment Research to “Hold”
Domtar Corporation (NYSE:UFS) (TSE:UFS) was upgraded by Zacks Investment Research from a “sell” rating to a “hold” rating in a research note issued on Wednesday.
According to Zacks, “Domtar is seeking growth through profitable investment opportunities with a commitment to pollution-free environment and sustainable practices. The strategic acquisition of Home Delivery Incontinent will expand the Personal Care segment of the company with complementary products. Domtar is also streamlining the cost structure, improving revenue quality and maintaining a healthy cash flow with a disciplined approach to cash utilization. However, on the flip side, 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. Over the past three months, Domtar’s shares have underperformed compared to the Zacks-categorized Paper & Paper Products industry average. Also, fluctuations in the prices and the demand for the company’s pulp and paper products pose as threats.”
A number of other analysts also recently issued reports on the stock. CIBC raised shares of Domtar Corporation from a “sector underperform” rating to a “sector perform” rating in a report on Monday, June 5th. ValuEngine downgraded shares of Domtar Corporation from a “buy” rating to a “hold” rating in a report on Friday, June 2nd. Scotiabank boosted their price objective on shares of Domtar Corporation from $38.50 to $40.50 and gave the company a “sector perform” rating in a report on Friday, April 28th. Citigroup Inc. reissued a “neutral” rating and issued a $39.00 price objective (down previously from $41.00) on shares of Domtar Corporation in a report on Friday, April 14th. Finally, DA Davidson reissued an “underperform” rating and issued a $32.00 price objective (down previously from $35.00) on shares of Domtar Corporation in a report on Wednesday, March 29th. One equities research analyst has rated the stock with a sell rating, eight have given a hold rating and four have issued a buy rating to the stock. The stock currently has a consensus rating of “Hold” and a consensus target price of $42.17.
Domtar Corporation (NYSE:UFS) traded down 1.4906% during midday trading on Wednesday, hitting $36.8031. 122,191 shares of the company traded hands. The company has a market capitalization of $2.31 billion, a price-to-earnings ratio of 16.0013 and a beta of 1.45. The stock’s 50-day moving average price is $37.64 and its 200 day moving average price is $38.87. Domtar Corporation has a 12-month low of $32.74 and a 12-month high of $44.58.
Domtar Corporation (NYSE:UFS) (TSE:UFS) last announced its earnings results on Thursday, April 27th. The basic materials company reported $0.32 EPS for the quarter, topping the consensus estimate of $0.24 by $0.08. The business had revenue of $1.30 billion during the quarter, compared to the consensus estimate of $1.25 billion. Domtar Corporation had a net margin of 2.82% and a return on equity of 6.50%. Domtar Corporation’s revenue was up 1.3% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.35 EPS. On average, equities analysts forecast that Domtar Corporation will post $2.79 EPS for the current year.
The business also recently disclosed a quarterly dividend, which will be paid on Monday, July 17th. Investors of record on Monday, July 3rd will be given a dividend of $0.415 per share. This represents a $1.66 dividend on an annualized basis and a yield of 4.44%. The ex-dividend date is Thursday, June 29th. Domtar Corporation’s dividend payout ratio is 72.17%.
In related news, SVP Zygmunt Jablonski sold 3,134 shares of the company’s stock in a transaction that occurred on Monday, May 1st. The shares were sold at an average price of $39.53, for a total transaction of $123,887.02. Following the completion of the transaction, the senior vice president now directly owns 19,604 shares in the company, valued at approximately $774,946.12. The transaction was disclosed in a filing with the SEC, which is available through the SEC website. Also, insider Michael Dennis Garcia sold 15,628 shares of the company’s stock in a transaction that occurred on Tuesday, May 2nd. The stock was sold at an average price of $38.80, for a total transaction of $606,366.40. Following the transaction, the insider now owns 3,290 shares of the company’s stock, valued at $127,652. The disclosure for this sale can be found here. Over the last quarter, insiders have sold 26,269 shares of company stock valued at $1,027,531. 1.04% of the stock is owned by corporate insiders.
Institutional investors have recently added to or reduced their stakes in the company. BlackRock Inc. boosted its position in Domtar Corporation by 8,753.9% in the first quarter. BlackRock Inc. now owns 10,377,062 shares of the basic materials company’s stock worth $378,971,000 after buying an additional 10,259,859 shares in the last quarter. Fairpointe Capital LLC boosted its position in Domtar Corporation by 29.7% in the first quarter. Fairpointe Capital LLC now owns 3,664,354 shares of the basic materials company’s stock worth $133,822,000 after buying an additional 839,266 shares in the last quarter. Norges Bank bought a new position in Domtar Corporation during the fourth quarter worth about $23,553,000. Federated Investors Inc. PA boosted its position in Domtar Corporation by 359.1% in the fourth quarter. Federated Investors Inc. PA now owns 559,060 shares of the basic materials company’s stock worth $21,820,000 after buying an additional 437,278 shares in the last quarter. Finally, Renaissance Technologies LLC boosted its position in Domtar Corporation by 1,243.6% in the first quarter. Renaissance Technologies LLC now owns 280,042 shares of the basic materials company’s stock worth $10,227,000 after buying an additional 259,200 shares in the last quarter. Institutional investors and hedge funds own 86.34% of the company’s stock.
About Domtar Corporation
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 segments include Pulp and Paper and Personal Care. The Pulp and Paper segment consists of the design, manufacturing, marketing and distribution of communication, specialty and packaging papers, as well as softwood, fluff and hardwood market pulp.
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